If the flotation cost goes up, the cost of retained earnings will
A) go up.
B) go down.
C) stay the same.
D) slowly increase.

Name: If the flotation cost goes up, the cost of retained earnings will A) go up. B) go down. C) stay the same. D) slowly increase.
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Question

Quizplus · Accepted Answer

Flotation costs are associated with issuing new securities and do not affect the cost of retained earnings, which are profits reinvested in the company rather than distributed to shareholders.

If the Flotation Cost Goes Up, the Cost of Retained