This year, Sooner Company reports current E&P of negative $460,000. Its accumulated E&P at the beginning of the year was $256,000. Sooner distributed $512,000 to its sole shareholder, Boomer Wells, on June 30 of this year. Boomers tax basis in his Sooner stock is $93,500.

This year, Sooner Company reports current E&P of negative $460,000. Its accumulated E&P at the beginning of the year was $256,000. Sooner distributed $512,000 to its sole shareholder, Boomer Wells, on June 30 of this year. Boomers tax basis in his Sooner stock is $93,500.

a. How much of the $512,000 distribution is treated as a dividend to Boomer?

b. What is Boomers tax basis in his Sooner stock after the distribution?

c. What is Sooners balance in accumulated E&P on the first day of next year?