CFAI Question help included, into, account, investment

ramzes

Reading 19 CFAI Question 1 (page 159) asks for b4 tax contribution from a 19% passive investment entity. In the answer, 19% of the dividend is all that is taken into consideration. My questions are: Is 19% of Net income not supposed to be taken into account and the dividend netted off that amount? Is dividend b4 tax or after tax, if after tax why then is it included since the quetion says EBT? Please help.

Matori

How come in this question you did not include the rise of 2 million of the stock’s market value in the EBT? I thought for available for sale securities under IFRS the appreciation of the market value of the security is included in the net income.