Solved

Which of the Following Is the Correct Expression for the Amount

Question 51

Multiple Choice

Which of the following is the correct expression for the amount of common stock or debt that a company needs to issue after taking into account the flotation costs?

A) Amount of issue = (Net proceeds - Other flotation costs in dollars) / (1 - Percentage flotation costs)
B) Amount of issue = (Net proceeds + Other flotation costs in dollars) / (1 - Percentage flotation costs)
C) Amount of issue = (Net proceeds + Other flotation costs in dollars) / (1 + Percentage flotation costs)
D) Amount of issue = (Net proceeds - Other flotation costs in dollars) / (1 + Percentage flotation costs)
E) Amount of issue = (Net proceeds + Other flotation costs in dollars) × (1 - Percentage flotation costs)

Correct Answer: