Practicing Success
Process of raising resources involves some cost, like expenses on issue of shares, debentures, raising of loans etc. It is known as _____________. |
Fixed Cost Variable Cost Total Cost Floatation Cost |
Floatation Cost |
The correct answer is option (4) : Floatation Cost The cost associated with the process of raising resources, such as expenses on issuing shares, debentures, raising loans, etc., is known as "4. Floatation Cost." Floatation costs are the costs incurred when a company raises capital or financial resources, and they include fees, commissions, legal expenses, and other expenses associated with the capital-raising process. These costs are deducted from the total amount raised to determine the net proceeds available for the company to use. |