Final Answer:
Research and Development (R&D) expenditures may lead to patents, copyrights, new processes, and new products. These costs are not intangible assets and are usually recorded as an expense when incurred.
Step-by-step explanation:
Research and Development (R&D) expenditures encompass the costs associated with activities aimed at creating new knowledge, products, or processes. These expenses are incurred in the pursuit of innovation and can lead to the development of tangible assets like patents, copyrights, new processes, and new products.
Unlike tangible assets, which are recorded on the balance sheet, these costs are considered expenses and are charged against the income statement in the period in which they are incurred. This treatment aligns with accounting principles, recognizing the uncertain nature of R&D outcomes and the difficulty in assigning a reliable value to the potential future benefits.
Patents and copyrights, which protect intellectual property, often arise from the innovative work carried out during the R&D process. New processes and products, born out of research initiatives, contribute to a company's competitive advantage and market differentiation.