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Initial cost of the project including the flotation costs


Problem:

The Lingo Co. has a dept-equity ratio of .60. The firm is analyzing a new project which requires an initial outlay of $450,000 for new equipment. The flotation cost for new equity is 10% and for debt 5%.

Required:

Question: What is the initial cost of the project including the flotation costs?

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Accounting Basics: Initial cost of the project including the flotation costs
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