On January 3. 2024, Michelson \& Sons acquired a tract of tand just outside the city limits. The land and existing building were purchased for $2.4 million. Micheison paid $400,000 and signed a noninterest-bearing note requiring the company to pay the remaining $2,000,000 on December 31,2025 . An interest rate of 7% properly reflects the time value of money for this type of loan agreement. Transfer taxes, title insurance, and other costs totaling $24,000 were paid at closing. At the end of February, the old building was demolished at a cost of $120.000, and an additional $100,000 was paid to clear and grade the land, Construction of a new building began on March 1 and was completed on October 30. Construction expenditures were as follows: Michelson did not borrow specifically for the construction project. but did have the following debt outstanding throughout 2024 : $6.000,000,8% iong-term note payabie $2,000,000,5% long-term note payable In December, the company purchased equipment and office furniture and fixtures for a lump-sum price of $800,000. The fair values of the equipment and the furniture and fixtures were $540,000 and $360,000, respectively. In December, Michelson paid $340,000 for the construction of parking lots and landscaping. Note: Use appropriate factor(s) from the tables provided. Round other intermediate calculations to the nearest whole dollar. Enter your answers in whole dollars. EV of \$1. PV of \$1. FVA of \$1. PVA of \$1, EVAD of \$1 and PVAD of \$1) Required: 1. Determine the initial values of the various assets that Micheison acquired or constructed during 2024. 2. How much interest expense will Michelson report in its 2024 income statement