On a nonliquidating distribution of depreciated property, subject to the debt, the corporation's earnings and profits would be:

a. Decreased by the basis of the property and increased by the amount of the debt

b. Increased by the basis of the distributed property and decreased by the amount

of the debt

c.Decreased by the unrecognized loss increased by the amount of the debt

d. Increased by the fair market value of the property