7. The New Elect Corporation was a C corporation until it elected \\( S \\) status on January 1,2023 . On January 1, 2023, New Elect had accumulated E\\&P (AEP) of \\( \\$ 20,000 \\) and, New Elect's AAA balance was \\( \\$ 40,000 \\). In 2023, New Elect had ordinary income of \\( \\$ 40,000 \\) and made distributions to its shareholder of \\( \\$ 110,000 \\). What is the tax result of the 2023 items if the sole shareholder's beginning basis is \\( \\$ 40,000 \\)