Cash Distributions; Determination of Taxable Amount (LO. 1, 3) Larry, the sole shareholder of Brown Corporation, sold his Brown stock to Ed on July 30 for $275,000. Larry's basis in the stock was $175,000 at the beginning of the year. Brown had accumulated E & P of $115,000 on January 1 and has current E & P of $120,000. During the year, Brown made the following distributions: $210,000 cash to Larry on July 1 and $70,000 cash to Ed on December 30

. a. How much of the current E & P is allocated to Larrys distribution ? $ 90000

b. How much of the current E & P is allocated to Eds distribution? $ 30000

c. How much of the $210,000 distribution is taxed as dividend income to Larry? $ 205000

d. How much of the $70,000 distribution is taxed as dividend income to Ed? $ 30000

e. Larry recognizes a capital gain of ????? on the sale of the stock.