All questions 5,6,7 and 8

Maria and Christopher each own 50% of Cockatoo Corporation, a calendar year taxpayer. Distributions from Cockatoo are: $750,000 to Maria on April 1 and $250,000 to Christopher on May 1. Cockatoo's current E & P is $300,000 and its accumulated E & P is $600,000, How much of the accumulated E & P is allocated to Christopher's distribution? a. $0 b. $75,000 c. $150,000 d. $300,000 e. None of the above Blue Corporation has a deficit in accumulated E & P of $300,000 and has current E & P of $225,000. On July 1, Blue distributes $250,000 to its sole shareholder, Sam, who has a basis in his stock of $52, 500. As a result of the distribution, Sam has: a. Dividend income of $225,000 and reduces his stock basis to $27, 500. b. Dividend income of $52, 500 and reduces his stock basis to zero. c. Dividend income of $225,000 and no adjustment to stock basis. d. No dividend income, reduces his stock basis to zero, and has a capital gain of $250,000. e. None of the above. Tangelo Corporation has an August 31 year-end. Tangelo had $50,000 in accumulated E & P at the beginning of its 2017 fiscal year (September 1, 2016) and during the year, it incurred a $75,000 operating loss. It also distributed $65,000 to its sole shareholder, Cass, on November 30, 2016. If Cass is a calendar year taxpayer, how should she treat the distribution when she files her 2016 income tax return (assuming the return is filed by April 15, 2017)? a. $65,000 of dividend income. b. $60,000 of dividend income and $5,000 recovery of capital. c. $50,000 of dividend income and $15,000 recovery of capital. d. The distribution has no effect on Cass in the current year. e. None of the above