Cardinal Company reports current E&P of $100,000 in 20X3 and accumulated E&P at the beginning of the year of $200,000. Cardinal distributed $400,000 to its sole shareholder on January 1, 20X3. The shareholder's tax basis in her stock in Cardinal is $200,000. How is the distribution treated by the shareholder in 20X3? Group of answer choices $300,000 dividend and $100,000 tax-free return of basis. None of the Above $200,000 dividend and $200,000 tax-free return of basis. $100,000 dividend, $200,000 tax-free return of basis, and $100,000 capital gain. $400,000 dividend