Evergreen Corporation, a calendar year taxpayer, has been an S corporation for several years. Rodney and Gary each own 50% of Evergreen's stock. On July 1 of the current year (assume a non-leap year), Evergreen issues additional common stock to Mercury Corporation for cash. Rodney, Gary, and Mercury each end up owning one-third of Evergreen's stock. Evergreen reports ordinary income of $149,650 and a short-term capital loss of $36,500 in the current year. Eighty percent of the ordinary income and all the capital loss accrue after Mercury purchases its stock. Evergreen makes no distributions to its shareholders in the current year.RequirementWhat income and losses do Evergreen, Mercury, Rodney, and Gary report as a result of the current year's activities? The sale of the additional stock terminates the S corporation election at the close of business on June 30. The income for the first half of the year is allocated equally to Rodney and Gary. The income earned after June 30 is taxed to Evergreen as a C corporation. What income and losses do Rodney, Gary, Mercury Corporation, and Evergreen Corporation report as a result of the current year's activities? 1/1 - 6/30 7/1 - 12/31 Shareholder Ordinary income Capital loss Ordinary income Capital loss Paul Mark Tiny Tim Corporation Frontier Corporation Total