Question - In 2013, a corporation distributed property with an adjusted basis of $100,000 and a fair market value of $140,000 to its shareholders. Its earnings and profits for 2013 were $170,000, and accumulated earnings and profits on January 1, 2013, were $370,000.
What is the amount of gain recognized by the corporation on the distribution?
a) $0,
b) $40,000,
c) $70,000,
d) $140,000 or
e) None of the above.