15.

Please show the reasoning behind the answer. Thanks.

16.

Please show the reasoning behind the answer. Thanks.

Hazel, Emily, and Frank, unrelated individuals, own all of the stock in Wren Corporation as follows: Hazel, 250 shares; Emily, 250 shares; and Frank, 600 shares. Wren redeems 300 of Frank's shares (basis of $40,000) for $160,000. At the time of the distribution, the company had $500,000 of E&P. With respect to the distribution in redemption of the stock: Frank has dividend income of $200,000. Frank has a capital gain of $200.000. Frank has dividend income of $160.000. Frank has a capital gain of $160.000. O .None of the other choices are correct