Cost of retained earnings

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			            	shraddha, India
			            
Cost of retained earnings

	          		My question is how to calculate cost of capital in case a company has its funds only through equity shares & its reserves?

Then how to calculate cost of retained earnings (reserves). As it is a major constituent of company's long term funds.
				      
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						            	bhavik, India
												
				                Reply to Question Regarding Retained Earnings

													The retained earnings can be calculated as follows:

K'E(i.e. Cost of retained earnings) = KE * (1 - F)

Where KE = Cost of Equity, F = Flotation cost

In case flotation cost is not given you may take KE = K'E

Suggestions welcomed...
				                
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