Everett forms an s corporation Sam inc on Jan 1 20x1. The taxable income is 25000. Everetts stock basis on Jan 1 20x1 is 1000. Sam inc distributed 30000 to Everett in 20x1. Everett has which of the following to report in 20x1

A. $4,000 capital loss

B. $25,000 ordinary income and $4,000 capital gain

C. $25,000 ordinary income from S corporation and no capital gain

D. $30,000 ordinary income from S corporation