4. In April E and F formed Z Corp. E contributed 350,000 cash, and F $70,000 (with an adjusted basis of $40,000). F also received $20,000 cashanwo corporation. E and F each received 50% of the corporation', stock, what of the land to Z CORP.? s the tax A. $40,000 B. $60,000 C. $50,000 D. $70,000 s. With regard to $ corporations and their shareholders, the "at-risk" rules losses A. Depend on the type of income reported by the s corporation B. Are subject to the elections made by the S corporation's shareholders C. Take into consideration the S corporation's ratio of debt to equity D. Apply at the shareholder level rather than at the corporate level. 6. Sandy is the sole shareholder of Swallow, an S corporation. Sand's adjusted basis in Swallow's stock is $60,000 at the beginning of the year. During the year. Swallowe eports the following income items: $30,000 5,000 10,000 Ordinary income Tax-exempt income Capital gains In addition, Swallow makes a nontaxable distribution to Sandy of $20,000 during the year. What is Sandy's adjusted basis in the Swallow stock at the end of the year? A. $60,000 B. $70,000 C. $85,000 D. $80,000