Kelly Ltd is currently working on four research and development projects. Summarised data relating to each project's expenditure and recoverable amount is provided below. Actual ($000) Budgeted ($000) Project 2018 2019 2020 2021 2022 . R & D expenditure 75 75 100 100 0 Expected revenue inflows 50 50 50 0 0 B R & D expenditure 200 200 350 0 0 Expected revenue inflows 0 0 500 1 250 500 R & D expenditure 1 500 500 250 0 0 Expected revenue inflows 0 0 1 750 1 750 750 D R & D expenditure 0 1 500 0 0 0 Expected revenue inflows 0 0 500 250 250 All revenue and expenditure predictions are deemed to be 'probable'. A discount rate of 6 per cent is used. In relation to the specific projects, the following information is also available: Project A This project involves the compilation of all known information about the abrasive natures of different types of seaweed. The revenue inflows of $50 000 per year are being provided by a major shipping company. Project B This project relates to the ultimate development of a surfboard that will allow surfers to do more radical manoeuvres. Fifty per cent of the expenditure in 2018 was considered to represent research, while the balance of the related expenditures represents development. Project C This project involves the development of a wetsuit with a rechargeable heat-pack. Initially, surfers rejected the concept because they believed it would create pain because of small electric shocks, and sales prospects looked poor. However, in 2019, surfers changed their minds and large-scale demand for the product was created. Only $250 000 of the expenditure in 2018 was deemed to represent research and the balance of all other expenditure was deemed to be development. Project D This project involves the development of a new wristwatch that predicts the height of waves. $250 000 has been spent on research and the balance on development. It is expected that only $1 000 000 will be recoverable. REQUIRED Determine how much research and development expenditure should be deferred as at the end of 2019