Last year Kogan.com Ltd (KGN), an Australian online electronics retailer, issued 28.4 million sharesinits Initial Public Offering (IPO). The offer price was $1.80 per share. The underwriters charged an underwriting fee of 4% of the offer price. Legal costs, and costs of producing the prospectus were $940,000. On the first day of trade, Kogan.com shares closed at a price of $1.50 per share.

a) Calculate the proceeds to Kogan.com after deducting just the underwriting fee.

b) Calculate the total issuance cost of the IPO.