5. Newco was organized in 2012 and immediately filed an " ( S ) " election. In the first year of operation (2013) it lost ( $ 50,000 ). In the next eight years (2014-2021) it had net income totaling ( $ 120,000 ). In 2022 it made distributions to its 3 equal shareholders of ( $ 30,000 ) each. At the end of 2021 , the balance in its AEP account is: a. 0 b. ( ($ 20,000) ) c. ( $ 90,000 ) d. ( $ 30,000 ) e. None of the above

5. Newco was organized in 2012 and immediately filed an " S " election. In the first year of operation (2013) it lost \$50,000. In the next eight years (2014-2021) it had net income totaling $120,000. In 2022 it made distributions to its 3 equal shareholders of $30,000 each. At the end of 2021 , the balance in its AEP account is: a. 0 b. ($20,000) c. $90,000 d. $30,000 e. None of the above