D purchased all of the stock in SB, Inc., in 1980 for $76,000. On December 31 of the current year, SB, Inc., made a cash distribution of $135,000 to D. Assuming SB, Inc., has current E&P of $15,000 and accumulated E&P of $40,000, the distribution will be treated as

a. taxable dividend of $135,000.

b. taxable dividend of $55,000 and nontaxable return of investment of $80,000.

c. taxable dividend of $55,000, the nontaxable return of investment of $76,000, and a capital gain of $4,000.

d. taxable dividend of $55,000 and capital gain of $80,000.