Multiple cash distributions- Positive E&P . Z corporations books reveal the following information at year-end before cash distributions are considered:

Capital stck...............$100,000

Current E&P ............22,000

Accumulated E&P .....32,000

M is a 10% shareholder whose basis for 1,000 shares is $8 per share, or $8,000 total. Compute the tax consequences to Zand M if corporate cash distributions during the year were:

a. $30,000 on December 31.

b. $12,000 for each of the first two quarters and $18,000 for each of the last two quarters.