Both Tracy and Cabel Own One-Half of the Stock of Finch

Multiple Choice

Both Tracy and Cabel own one-half of the stock of Finch, Inc., an S corporation with no accumulated E & P. Tracy'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. Tracy's stock basis at the end of the year is:

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