Under the imputation tax system,what will be the grossed up value of a $1 cash dividend that was paid fully franked.The company tax rate is 30%.

Question

Quizplus · Accepted Answer

The grossed-up value of a $1 cash dividend in a system with a 30% company tax rate is calculated by dividing the cash dividend by (1 - tax rate), which is $1 / (1 - 0.30) = $1.43. This accounts for the tax already paid by the company on the earnings from which the dividend is paid.

Under the Imputation Tax System,what Will Be the Grossed Up