Monty Company distributed $70,000 to Susan in redemption of all her stock. Susan’s basis in the stock is $20,000 and her pro rata share of earnings and profits is $30,000. Assuming all the requirements for a redemption are met, how should Susan treat the distribution for federal income tax purposes?

a. $0

b. $20,000 dividend income

c. $30,000 dividend income and $20,000 capital gain

d. $50,000 capital gain

e. None of the above