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Lucy has been the sole shareholder of a calendar year S corporation since 1980. At the end of 2011, Lucy's stock basis is $23,500, and
Lucy has been the sole shareholder of a calendar year S corporation since 1980. At the end of 2011, Lucy's stock basis is $23,500, and she receives a distribution of $25,000. Corporate level accounts are computed as follows.
| AAA | 7,000 |
| PTI | 11,000 |
| Accumulated E&P | 600 |
How much capital gain, if any, will Lucy have?
| $600 | ||
| $7,000 | ||
| $6,400 | ||
| $900 | ||
| None of the above |
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