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Assume an S corp. has accumulated E & P of $1,000, AAA of $5,000 and...

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Accounting

Assume an S corp. has accumulated E & P of $1,000, AAA of $5,000 and makes a $7,000 cash distribution to the shareholder. Also assume the shareholder's basis in the S corp. stock is $5,500. How is this distribution taxed to the shareholder?

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