On January 2, 2017, Tim loans his S corporation $10,000. By the end of 2017, Tims stock basis is zero, and the basis in his note has been reduced to $7,000 as a result of losses incurred during the year. During 2018, the companys operating income is $10,000. The company makes no 2018 distributions to Tim. Tim has a(n):

a. Stock basis of $2,000.

b. Stock basis of $10,000.

c. Loan basis of $10,000.

d. Loan basis of $9,000.

e. Loan basis of $8,000.