Winkler Corporation has 1,000 shares of common stock outstanding owned as follows: Shisong, 500 shares and Iris (an unrelated party), 500 shares. Shisong and Iris each paid $100 per share for the Winkler stock 10 years ago. Winkler distributes land held as an investment (fair market value of $80,000, adjusted basis of $30,000) to Iris in redemption of 250 of her shares.

a. What are the tax results to Iris on the redemption of her Winkler stock?

b. What gain or loss results to Winkler Corporation on the redemption?

c. Assume that Winklers' s E & P is $170,000 after any required adjustment for the gain or loss on the land distribution but before any required adjustment for the stock redemption. What is the reduction in Winkler Corporation's E & Pas a result of the redemption?