26 For tax purposes, private and public companies must be distinguished for which of the following reasons? Oa. Private companies are taxed at a higher rate. Ob. Certain loans and payments to persons associated with private companies may be deemed as dividends. O Dividends paid by private companies can only be franked to 50%. Od. A rebate of tax applies to private company dividends. QUESTION 27 A prepayment for trading stock is not an allowable deduction because: Oa. It is incurred under s. 8-1, but qualified by s. 70-15 (in that it must be 'on hand). Ob. It is not incurred for the purpose of s. 8-1. 00 Prepayments are not an allowable deduction under s. 8-1. Od. It is incurred under s. 8-1, but is of a capital nature