Question: Problem 5-30 (Algorithmic) (LO. 1, 3) Sparrow Corporation is a calendar year taxpayer. At the beginning of the current year, Sparrow has accumulated E &

Problem 5-30 (Algorithmic) (LO. 1, 3) Sparrow Corporation is a calendar

Problem 5-30 (Algorithmic) (LO. 1, 3) Sparrow Corporation is a calendar year taxpayer. At the beginning of the current year, Sparrow has accumulated E & P of $117,200. The corporation incurs a deficit in current E & P of $164,080 that accrues ratably throughout the year. On June 30, Sparrow distributes $70,320 to its sole shareholder, Libby. If Libby's stock has a basis of $11,720, how is she taxed on the distribution? Taxable dividend income in the amount of s Return of capital in the amount of s Capital gains in the amount of $

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