3. A building was constructed last year for Agro Co. for use as a production facility. Construction began on January 1 and was completed on December 31. The payments to the contractor were as follows.

Date	Payment
1/1	$400,000
4/30	600,000
8/1	420,000
10/1	600,000

To finance construction of the building, a $750,000, 10% construction loan was taken out on January 1. The loan was repaid on December 31. The firm had two sources of general debt: $400,000 note payable, 10% annual interest, and $500,000 par value bonds, 7% annual interest.

Determine the amount of interest to be capitalized.

(show work including formulas)