As of January 1, Warbler Corporation Has a Deficit in Accumulated

question 58

Multiple Choice

As of January 1, Warbler Corporation has a deficit in accumulated E & P of $150,000. For the year, current E & P (accrued ratably) is $260,000 (prior to any distributions) . On July 1, Warbler Corporation distributes $295,000 to its sole shareholder. The amount of the distribution that is a dividend is:

• A) $10,000.
• B) $110,000.
• C) $260,000.
• D) $295,000.
• E) None of the above.