During 2011, Oxen Corporation Incurs the Following Transactions

During 2011, Oxen Corporation incurs the following transactions. Oxen maintains a valid S election and does not distribute any assets (cash or property) to its sole shareholder, Megan. As a result, Megan must recognize:

A) Ordinary income of $103,000 and long-term capital gain of $5,000.
B) Ordinary income of $103,000, long-term capital gain of $10,000, and $4,000 short-term capital loss.
C) Ordinary income of $108,000.
D) None of the above.