Question 5 (12 marks in total) a. The University of Newcastle Ladies Tennis Club contacts you to determine whether the clubs income of $1,788 is assessable for tax purposes. Advise the club with specific reference to the ap- propriate sections of the Income Tax Assessment Act 1997. (2 marks) b. On 1 July 2019 Mr & Mrs Bens sold their 100% share ownership in Bens Mechanics Pty Ltd to Mr & Mrs Apex. At that time the company had a carried forward trading loss of $10,000 for in- come tax purposes. Mr & Mrs Apex changed the trading name of the company to Apex Mechanics but continued to operate the mechanics business from the same premises. Advise whether the $10,000 loss will be available to offset against the com- pany's assessable income in the 2020 tax year. (3 marks) c. Explain the implications of the principle of mutuality to the pay- ment of salaries to partners by a partnership. (3 marks) d. Calculate the amount of movement in a company's franking ac- count as a result of the following transactions: i. Payment of final 2018/19 tax instalment of $70,000 (2 marks) ii. Payment of fully franked interim dividend of $50,000. (2 marks) Question 5 (12 marks in total) a. The University of Newcastle Ladies Tennis Club contacts you to determine whether the clubs income of $1,788 is assessable for tax purposes. Advise the club with specific reference to the ap- propriate sections of the Income Tax Assessment Act 1997. (2 marks) b. On 1 July 2019 Mr & Mrs Bens sold their 100% share ownership in Bens Mechanics Pty Ltd to Mr & Mrs Apex. At that time the company had a carried forward trading loss of $10,000 for in- come tax purposes. Mr & Mrs Apex changed the trading name of the company to Apex Mechanics but continued to operate the mechanics business from the same premises. Advise whether the $10,000 loss will be available to offset against the com- pany's assessable income in the 2020 tax year. (3 marks) c. Explain the implications of the principle of mutuality to the pay- ment of salaries to partners by a partnership. (3 marks) d. Calculate the amount of movement in a company's franking ac- count as a result of the following transactions: i. Payment of final 2018/19 tax instalment of $70,000 (2 marks) ii. Payment of fully franked interim dividend of $50,000. (2 marks)