Calculating interest capitalized during construction. Target Stores constructed new stores during Year 14. The average balance in the Construction-in-Process account excluding Year 14's capitalized interest costs was $3,400,000 during the year. Target Stores engaged in borrowing directly related to these stores in the amount of $2,000,000, which carries an interest rate of 6 percent. Target Stores has other borrowing outstanding totaling S8.()()().()()() at an average interest rate of 7 percent. Compute the amount of interest capitalized in the Construction-inProcess account during Year 14.