A Calendar-Year Corporation Has Positive Current E&P of $500 and Accumulated

A calendar-year corporation has positive current E&P of $500 and accumulated negative E&P of $1,200.The corporation makes a $400 distribution to its sole shareholder.Which of the following statements is true?

A) The distribution will not be a dividend because total earnings and profits is a negative $700.
B) The distribution may be a dividend,depending on whether total earnings and profits at the date of the distribution is positive.
C) The distribution will be a dividend because current earnings and profits is positive and exceeds the distribution.
D) A distribution from a corporation to a shareholder is always a dividend,regardless of the balance in earnings and profits.