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The company tax rate is 30 cents in the dollar and a

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ReferencesMultiple ChoiceDifficulty: HardLearning Objective: 6.03 Understand theimportance of taxation in the investmentdecision process.
The company tax rate is 30 cents in the dollar and a company earns an after-tax profit of $400 000.If 80 per cent of the profit is paid as a fully franked dividend, what is the taxable income of aninvestor whose only source of income is a 10 per cent holding in the shares of this company?$13 714$40 000$45 714$32 000The company's total dividend payout will be $400 000 × 0.8 = $320 000 so the investor's share is$32 000. The imputation credit attached to the dividend will be $(32 000 × 0.3)/0.7 = $13 714. Theinvestor's taxable income is equal to the dividend plus the imputation credit—a total of $45 714.
10.Award:0 out of 10.00 pointsWhich of the following statements about fundamental analysis and technical analysis is correct?
ReferencesMultiple ChoiceDifficulty: MediumLearning Objective: 6.01 Consider therole of an investor in the share market,appreciate the wide range of investmentchoices that are available andunderstand risks associated withinvestments in shares of listedcorporations.
11.Award:0 out of 10.00 pointsIn October 2004, Arthur purchased 10 000 shares in XYZ Limited at $4.50 each. In March 2007, hesells half of the shares at $8.10 per share and on 30 June 2007 the closing price of XYZ shares was$9.20. Arthur's marginal tax rate on income is 48.5 per cent. How much capital gains tax will he payon his investment in XYZ?$8700$2865$4365$9000The gain on the 5000 shares sold is 5000 × $(8.10 – 4.50) = $18 000. Since the shares were heldfor more than a year the gain is discounted by 50 per cent to $9000 so the capital gains tax is$9000 × 0.485 = $4365. Only the realised gains are taxed, so the shares still held can be ignored.
12.Award:0 out of 10.00 pointsReferencesMultiple ChoiceDifficulty: HardLearning Objective: 6.03 Understand theimportance of taxation in the investmentdecision process.

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