Basis of S Corporation Stock. Cathy is a 40% shareholder of City Corporation. City is a calendar year S corporation. Cathy acquired her stock on January 1 of the current year for $80,000. In the current year, City reports the following results of operations, cash distributions, and salary payments: a. What is Cathy's stock basis at the end of the current year? b. What amounts should Cathy include in her individual tax return for the current year? Will the salary Cathy pays to herself affect her qualified business income deduction