On May 10 of the current year, Addison Corporation distributes to its shareholder Debra $14,000 in cash and land (a capital asset) having a $90,000 FMV. The land has a $14,000 adjusted basis (for both taxable income and E&P purposes) and is subject to a $95,000 mortgage, which Debra assumes. Addison has an E&P balance exceeding the amount distributed and is subject to a 21% corporate tax rate.

a. What are the amount and character of the income Debra recognizes as a result of the distribution?

b. What is Debra's basis in the land?

c. What are the amount and character of Addison's gain or loss as a result of the distribution?