WLS Corporation has three shareholders: Brown $(20\%),$ Smith $(10\%)$

WLS Corporation has three shareholders: Brown $(20\%),$ Smith $(10\%),$ and Jones

$(70\%).$ None of these individuals are related.

The corporation redeems all of Brown's shares for $$100,000.$ Brown's basis in

his shares is $$40,000.$

SELECT ALL OF THE TRUE STATEMENTS FROM THE LIST BELOW!!

Brown has $$100,000$ of dividend income.

Brown has a capital gain of $$60,000.$

WLS Corporation will transfer out $20\%$ of the E&P on the distribution.

WLS Corporation will transfer out $$100,000$ of E&P on the distribution.

Note: Provide accurate solution ASAP and provide explanation for correct and incorrect options both.