Winnipeg Water & Gas Co. recently issued a series of bonds; the gross proceeds were $25 million.

Question:

Winnipeg Water & Gas Co. recently issued a series of bonds; the gross proceeds were $25 million. The underwriting fees were 1.8 percent, and additional issuance costs were $100,000. How much did the company actually receive from the sale? As a percentage of the gross proceeds, what were the total costs of the bond issue?