1.A company derives taxable trading income of $100 and a cash dividend of $35, fully franked. Assuming that the relevant tax has been paid as required, how much can the company pay as franked distributions (without attracting Franking Deficit Tax)?

$105 fully franked

$120 fully franked

$250 franked to 50%

Some other amount

2.For tax purposes, private and public companies must be distinguished for which of the following reasons?

1 - A rebate of tax, outside the dividend franking system, applies to private company dividends received by public companies

2 - Public companies do not have to comply with the continuity tests to claim losses from prior years

3 - Certain loans and payments to persons associated with private companies may be deemed dividends

2 & 3

2 only

3 only

1 & 2