Question: George is the owner of SRC Inc., an S corporation that he formed this year with an investment of $50,000. Net business income (ordinary income) for SRC for the first tax year is $20,000. SRC Inc. paid $5,000 in nondeductible meal and entertainment expenses, and George did not take a distribution. What is George's adjusted basis in SRC Inc. stock at the end of the first tax year?
a) $50,000 b) $20,000 c) $75,000 d) $65,000