On February 1, 2024, Health First Hospital contracted Medical Equipment Solutions to install new medical equipment for $900,000. Health First Hospital made payments for the installation as follows: March 1, $200,000, May 1, $400,000, July 1, $300,000. The installation was completed, and the equipment was operational on July 31, 2024. Health First Hospital had the following outstanding debt as of December 31, 2024:

i) 10% four-year note to finance the installation, dated February 1, 2024, with interest payable annually on December 31. Principal amount: $600,000. ii) 6% seven-year note payable, dated February 1, 2021, with interest payable annually on December 31. Principal amount: $300,000.

Required: i) Determine the amount of interest to be capitalized in 2024 in relation to the medical equipment installation. (6 marks) ii) Prepare journal entries for Health First Hospital during 2024.