KRJ International's balance sheet shows outstanding convertible debt (with annual coupon payments) with a book value of $1,000,000 and a current market value of $1,255,000. The bonds have 5 years to maturity and a coupon rate of 3%. The yield to maturity on comparable debt is 8%. How much (in $) of the value of the convertible debt should be considered as part of equity when the company calculates its WACC?