Mike purchased 200 shares of XYZ stock for $1,500 in 2014. XYZ had no earnings or profits in 2015 or 2016. Mike received a $1,000 return of capital in 2015 and a $1,000 return of capital in 2016. What should be reported on his 2016 tax return?

a. $500 capital gain.

b. $500 dividend income.

c. $1,000 capital gain.

d. $1,000 dividend income