16 of 75. Paula is a shareholder in an S corporation. She purchased 200 shares of the corporation at the beginning of the year for $25,000. Her Schedule K-1 (Form 1120-S) for the same year reported ordinary business income of $1,300 in Part III, box 1 and $1,500 of net long-term capital gain in Part III, box 8a. What is Paula's year-end adjusted basis in the corporation? $25,000 $26,300 $26,500 $27,800