Bev and Cabel Each Own One-Half of the Stock of Finch

Multiple Choice

Bev and Cabel each own one-half of the stock of Finch, Inc., an S corporation with no accumulated E & P.Bev's basis in the Finch stock is $225,000.Finch's taxable income for the current year is $100,000, and it distributes $180,000 to each shareholder.Bev's stock basis at the end of the year is:

A) $0.
B) $45,000.
C) $95,000.
D) $100,000.