38. Which of the following tax consequences is not determined by reference to a shareholders adjusted basis in the shareholders stock in an S corporation?

a. the extent to which a distribution made by the corporation to the shareholder is taxable

b. the amount of losses that the shareholder may deduct in a given year

c. the shareholders realized gain or loss upon the sale or exchange of the stock

d. the amount of distributions to which the shareholder is entitled in a given year

39. Net passive investment income may cause an S corporation to lose S status

a. if it exceeds 30% of the corporations adjusted gross income for 3 consecutive tax years.

b. unless the corporation was not previously a C corporation.

c. if it is a successor to a C corporation having assets in excess of $10 million fair market value.

d. if the passive investment income was generated by real estate investments.

PLEASE ANSWER BOTH! & EXPLAIN