PROBLEM Ann owns all of the common stock (the only class outstanding) of Pelican Corporation. Prior to the transactions below and as a result of a $ 351 transfer, Ann has a $10,000 basis in her Pelican stock. What results to Ann and Pelican in each of the following alternative situations? (a) In year one Pelican has $5,000 of current and no accumulated earnings and profits and it distributes $17,500 to Ann? (b) Pelican has a $15,000 accumulated deficit in its earnings and profits at the beginning of year two. In year two Pelican has $10,000 of current earnings and profits and it distributes $10,000 to Ann. (c) Pelican has $10,000 of accumulated earnings and profits at the beginning of year two and $4,000 of current earnings and profits in year two. On July 1 of year two, Ann sells half of her Pelican stock to Baker Corporation for $15,000. On April 1 of year two, Pelican distributes $10,000 to Ann, and on October 1 of year 2, Pelican distributes $5,000 to Ann and $5,000 to Baker. (d) Same as (c), above, except that Pelican has a $10,000 deficit in earnings and profits in year 2 as a result of its business operations. PROBLEM Ann owns all of the common stock (the only class outstanding) of Pelican Corporation. Prior to the transactions below and as a result of a $ 351 transfer, Ann has a $10,000 basis in her Pelican stock. What results to Ann and Pelican in each of the following alternative situations? (a) In year one Pelican has $5,000 of current and no accumulated earnings and profits and it distributes $17,500 to Ann? (b) Pelican has a $15,000 accumulated deficit in its earnings and profits at the beginning of year two. In year two Pelican has $10,000 of current earnings and profits and it distributes $10,000 to Ann. (c) Pelican has $10,000 of accumulated earnings and profits at the beginning of year two and $4,000 of current earnings and profits in year two. On July 1 of year two, Ann sells half of her Pelican stock to Baker Corporation for $15,000. On April 1 of year two, Pelican distributes $10,000 to Ann, and on October 1 of year 2, Pelican distributes $5,000 to Ann and $5,000 to Baker. (d) Same as (c), above, except that Pelican has a $10,000 deficit in earnings and profits in year 2 as a result of its business operations