Greg and Myrtle are each 50-percent owners in Red Oak Corp., a regular C corporation. Red Oak has a current year operating loss of $30,000. It pays a $50,000 salary to Greg and $5,000 dividend to Myrtle. The following are tax consequences of these transactions:

		A. Red Oak has a $5,000 dividends received deduction and Myrtle has $5,000 of dividend income.
		B. Red Oak has no taxable income for the current year, and Myrtle has $5,000 of dividend income.
		C. Red Oak has no taxable income for the current year, and Myrtle has a $5,000 dividend received deduction.
		D. Neither Red Oak nor Myrtle has any taxable income in the current year.