issue costForums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › issue costThis topic has 1 reply, 2 voices, and was last updated 6 years ago by John Moffat.Viewing 2 posts - 1 through 2 (of 2 total)AuthorPosts August 22, 2018 at 1:57 pm #468866 thomas1212MemberTopics: 45Replies: 16☆☆when we need to raise 2m and issue cost is 3%i know that we must calculate the issue cost as (3 / 0.97 )however i do not understand why the issue cost isn’t (3 / 100) ??why we use the base as 97 not 100 ???i simply the know the method but i do not know the rationale behind it August 23, 2018 at 5:53 am #469003 John MoffatKeymasterTopics: 57Replies: 54497☆☆☆☆☆If they raid $100 and then have to pay issue costs of 3%, then they pay $3 which leaves $97 to invest.Therefore for every $97 they want to invest, they need to raise $100, so 100/97 x the total investment.AuthorPostsViewing 2 posts - 1 through 2 (of 2 total)You must be logged in to reply to this topic.Log In Username: Password: Keep me signed in Log In