The 100 Shares of Outstanding Stock of Majestic Corporation Are

The 100 shares of outstanding stock of Majestic Corporation are owned by Jim and Bob, 40 and 60 shares respectively.Neither shareholder is related to the other.Each has a basis in his stock of $100 per share.During the year, Jim sold 10 of his shares back to the corporation for $10,000.Assuming the corporation has substantial earnings and profits, Jim's A.G.I.will increase by

A) A capital gain of $ 10,000
B) A dividend of $10,000
C) A capital gain of $9,000
D) A dividend of $9,000
E) None of the above