in its first year of operation as an A corp the corporation had ordinary business income of $8000. Iit also has tax exempt income of $1000. the corporation had $2000 of c corp earnings and profits accumulated prior to the s corp election. The shareholder basis in the shares at the beginning of that first year was $3000. At the end of that year the corporation distributes $8500 to its sole shareholder. How is the distribution treated for tax purposes? Include in your answer the basis of the shares in the s corp at the beginning of the year following the years of the distribution.