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  3. on january 1,2022 , kinney, inc., an s corporation

On January 1,2022 , Kinney, Inc., an S corporation, reports $5,600 of accumulated E \&...

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Accounting

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On January 1,2022 , Kinney, Inc., an S corporation, reports $5,600 of accumulated E \& P and a balance of $14,000 in AAA. Kinney has two shareholders, Erin and Frank, each of whom owns 500 shares of Kinney's stock. Kinney's nonseparately stated ordinary income for the year is $7,000. Kinney distributes $8,400 to each shareholder on July 1 , and it distributes another $4,200 to each shareholder on December 21 . How are the shareholders taxed on the distributions? Ignore the 20% QBI deduction. Do not round intermediate computations. If required, round your final answers to the nearest dollar. Erin and Frank each report \$ dividend income for the July 1 distribution and $ each for the December 21 distribution. Assuming that the shareholders have sufficient basis in their stock, Erin and Frank each receive a $ distribution from AAA

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