fact pattern for questions 21 and 22 efg inc is a calendar year corporation efg 384613

Fact Pattern for Questions 21 and 22. EFG Inc. is a calendar year corporation. EFG had current earnings and profits of $100,000 and no accumulated earnings and profits when it distributed a total of $160,000 to its two equal shareholders, Jane and Joe. On the date of the cash distribution, Janes basis in her EFG Inc. stock was $10,000 and Joes basis in his EFG Inc. stock was $35,000. How much is includible by Jane in her gross income for the current taxable year with respect to the distribution to her? Answer A. $50,000 dividend income and 0 capital gain. B. $80,000 dividend income and 0 capital gain. C. 0 dividend income and $70,000 capital gain. D. $50,000 dividend income and $20,000 capital gain. Fact Pattern for Questions 21 and 22. EFG Inc. is a calendar year corporation. EFG had current earnings and profits of $100,000 and no accumulated earnings and profits when it distributed a total of $160,000 to its two equal shareholders, Jane and Joe. On the date of the cash distribution, Janes basis in her EFG Inc. stock was $10,000 and Joes basis in his EFG Inc. stock was $35,000. What is Joes adjusted basis in his EFG Inc. stock after the distribution? Answer A. $0. B. $5,000. C. $15,000. D. $35,000.