Question: currently has a $ 7 5 4 election in effect and has no hot assets or liabilities. Which of the following statements is true? Multiple

currently has a $754 election in effect and has no hot assets or liabilities. Which of the following statements is true?
Multiple Choice
KDP will increase the basis of its assets by $22,000 and Kathy will recognize a $22,000 loss on the distribution.
KDP will decrease the basis of its assets by $22,000 and Kathy will recognize a $22,000 loss on the distribution.
KDP will increase the basis of its assets by $22,000 and Kathy will recognize a $22,000 gain on the distribution.
KDP will decrease the basis of its assets by $22,000 and Kathy will recognize a $22,000 gain on the distribution.
currently has a $ 7 5 4 election in effect and

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