Question

Webee Ltd. has entered the growth stage of its business. It is raising external finances to sustain its operations. In which type of funding will it have to incur flotation costs? (FINANCE)

A. Issue of common stocks
B. Reinvesting retained earnings
C. Borrowing money from a commercial bank
D. Borrowing money from insurance companies

Answer 1

Flotation costs are the amounts that are significantly required for the issuing of various securities in a company such as legal fees and registration fees. In addition, the type of funding that would mostly likely incur flotation costs in Webee Ltd. would be by issuing common stocks.

Answer 2

Answer:

The answer is "issue of common stocks"

Explanation: