Elvis Owns All of the Stock of Shadow Corporation

question 74

Multiple Choice

Elvis owns all of the stock of Shadow Corporation.The accumulated earnings and profits of Shadow Corporation at the end of the year are a deficit of $12,000.The current earnings and profits are $25,000.Elvis' basis for his stock is $290,000.He receives a distribution of $340,000 on the last day of the tax year.How much dividend income and/or capital gain should Elvis report?

• A)$0.
• B)Dividend income of $13,000 and capital gain of $37,000.
• C)Dividend income of $25,000 and capital gain of $25,000.
• D)Dividend income of $0 and capital gain of $50,000.
• E)None of the above.

---

Definitions:

Reaction

A process where substances, known as reactants, are converted into different substances, referred to as products, through chemical change.

Reaction

An action where materials combine and create new compounds that possess distinct characteristics.

Notations

Symbols and signs used in various fields such as mathematics, music, and literature to represent specific concepts, quantities, and operations.

Two-way Tables

A type of table used to display frequencies for two categorical variables, showing the relationship between them.