On January 1, 2015 smith research signed a contract to have Jameson builders construct a laboratory building at a cost of $20,000,000. It was estimated that it would take four years to complete the project. Also on January 1, 2016 to finance the construction cost, Jefferson borrowed $20,000,000 payable in five annual installments of $4,000,000 plus interest at the rate of 7% during 2016, Jefferson made following construction-related expenditures: 3/1 $600,000 7/1 $700,000 1 $900,000 hat amount should Jefferson report as capitalized interest at December 20162