35. LO.6, 8 Cougar, Inc., is a calendar year S corporation. Cougars Form 1120S shows nonseparately stated ordinary income of $80,000 for the year. Johnny owns 40% of the Cougar stock throughout the year. The following information is obtained from the corporate records.

Tax-exempt interest income	$ 3,000
Salary paid to Johnny	(52,000)
Charitable contributions	(6,000)
Dividends received from a non-U.S. corporation	5,000
Short-term capital loss	(6,000)
Depreciation recapture income	11,000
Refund of prior state income taxes	5,000
Cost of goods sold	(72,000)
Long-term capital loss	(7,000)
Administrative expenses	(18,000)
Long-term capital gain	14,000
Selling expenses	(11,000)
Johnnys beginning stock basis	$ 32,000
Johnnys additional stock purchases	9,000
Beginning AAA	31,000
Johnnys loan to corporation	20,000

a. Compute Cougars book income or loss.

b. Compute Johnnys ending stock basis.

c. Calculate Cougars ending AAA balance.