Flamingo Corporation (E & P of $700,000)has 1,000 Shares of Stock

Flamingo Corporation (E & P of $700,000) has 1,000 shares of stock outstanding.Jaime owns 400 shares,Lupe (Jaime's daughter) owns 400 shares,and the remaining 200 shares are owned by unrelated individuals.In an effort to raise funds for another investment,Jaime convinces Flamingo to redeem all of his shares for $380,000.Jaime acquired the stock seven years ago for $60,000.After the redemption,Jaime continued to serve as Flamingo's controller but Gabriella assumed his role as a member of the corporation's board of directors.As a result of the transaction,Jaime must recognize:

A) $380,000 dividend income.
B) $380,000 long-term capital gain.
C) $320,000 dividend income.
D) $320,000 long-term capital gain.
E) None of the above.