Suppose that at the beginning of 2019 Jamaal's basis in his S corporation stock is...
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Accounting
Suppose that at the beginning of 2019 Jamaal's basis in his S corporation stock is $1,600 and he has a $10,600 debt basis associated with a $10,600 loan he made to the S corporation. In 2019, Jamaal's share of S corporation income is $4,600, and he received a $7,600 distribution from the S corporation. What is Jamaal's stock and debt basis after these transactions?
Multiple Choice
$0 stock basis; $9,200 debt basis.
$0 stock basis; $10,600 debt basis.
$6,200 stock basis; $10,600 debt basis.
$6,200 stock basis; $3,000 debt basis.
None of the choices are correct.
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