Question 1 PQR Construction Ltd. commenced a contract on April 1, 2013. The total contract was for27,12,500. It was decided to estimate the total profit and to take to the credit of Costing P&L A/c the proportion of estimated profit on cash basis which work completed bear to the toba contract. Actual expenditure in 2013-14 and estimated expenditure in 2014-15 are given below 2014-15 Estimated (5) 8,14,000 3,80,00039540 37,500 39000 2013-14 Actual () 4,56,000 3,05,000 24,000 2,25,000 1,00,000 Material issued Labour : Paid : Outstanding at end Plant purchased Expenses : Paid : Outstanding at the end : Prepaid at the end Plant returned 10 stores (a historical stores) 1,75,000 25,000 22,500 75,000 22 2500 1,50,000 (on Dec. 31 2014) 75,000 Full Material at site Work-in progress certified Work-in-progress uncertified Cash received 30,000 12,75,000 40,000 10,00,000 Full The plant is subject to annual depreciation @20% of WDV cost. The contract is likely to be completed on December 31, 2014. Required: (i) Prepare the Contract A/c for the year 2013-14. (ii) Estimate the profit on the contract for the year 2013-14 on prudent basis which has to be credited to Costing P & L Alc