In 20X1, Cantell, Inc., has $6,000 of the accumulated adjustments account and $10,000 of previously taxed income. Carols basis in 100% of the corporate stock in $20,000. During the year, Carol receives a cash distribution of $45,000. What is the taxable nature of the distribution?

A. Dividend income: $45,000

B. Ordinary income: $45,000

C. Tax-free return of capital: $20,000; Capital gain: $25,000

D. Tax-free return of capital: $20,000; Dividend income: $25,000