Corporation X with an E&P of $100 owns

assets with aggregate bases of $50 and FMV

of $100. A, sole individual shareholder, has

stock in Corporation X whose basis is $25.

Assuming state and federal corporate tax rate

of 40%, and individual capital gains rate of

20%, what are tax consequences to A and X

upon distribution of those assets in complete

liquidation of X? What happens to the E&P?