(All based on the Australian taxation law)

1. Ian holds 100 shares in Big Bank Pty Ltd. The company paid a fully franked dividend of $4 per share on 1 June. What amount must Ian include in his assessable income for the year?

(A) $400

(B) $700

(C) $571

(D) $171

2.Which of the following statements is false?

(A) Dividends are an expense of the company.

(B) Not all shareholders are automatically entitled to franking credits attached to a franked distribution of profit.

(C) A dividend includes any amount credited by a company to its shareholders as shareholders.

(D) Dividends are defined in s 6(1) of ITAA 1936

3. Jill loves painting and is very good at it. She sometimes sells her paintings to friends and family members. She has met with an accountant who has determined that Jills activities are not sufficient to constitute a business for income tax purposes.

Jill can choose to register for GST.

(A)True

(B) False