alleryWhich is a merit of retained earnings?
AShareholders get more now
BProfits become certain
CMortgages are avoided
DNo explicit cost is paid
Answer & Solution
Correct answer: D. No explicit cost is paid
1. No interest, dividend or floatation cost arises.
2. The funds are permanent and flexible.
3. So there is no explicit cost.
_Source: syllabus Business Studies, Chapter 8, Sources of Business Finance._
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