Identify which of the following statements is false.
a. debt basis is restored before stock basis.
b. randy is a shareholder in an s corporation. his stock basis is $10,000 and his basis in a loan he made to the corporation is $3,000. randy's share of the corporation's ordinary loss for the current year is $11,000. ignoring the atminus−risk and passive activity limitations, randy can deduct the loss in full.
c. a shareholder's ratable share of the s corporation's ordinary loss reduces the adjusted basis of his/her s corporation stock. once the basis of the stock is reduced to zero, any loss minus−passthrough that remains reduces the basis of s corporation debts that are owed to the shareholder.
d. a shareholder's s corporation stock basis will increase when the shareholder acts as guarantor on a corporate indebtedness.