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Financial management????

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(Querist)
15 July 2013 given that,
face value of share = rs.100
issue price of share = rs.120
and flotation cost is 5%.

Q.on which amount flotation cost is applied 100(FV) or 120(IP)??????

pls help
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Ashish Kukreja

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Ashish Kukreja (Expert)
16 July 2013 Flotation cost is to be applied on Issue Price..Flotation cost per share will be 5% of Rs.120 = Rs.6 per share
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