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Jay is the sole shareholder of James, Inc., an S corporation. In 20X1, the S corporation has taxable income of $40,000. Jays stock basis at

Jay is the sole shareholder of James, Inc., an S corporation. In 20X1, the S corporation has taxable income of $40,000. Jays stock basis at January 1, 20X1, is $10,000. What is Jays stock basis at December 31, 20X1?

A. $10,000

B. $40,000

C. $50,000

D. $75,000

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