3. Seven years ago, Eleanor transferred property she had used in her sole proprietorship to Blue Corporation for 2,000 shares of Blue Corporation in a transaction that qualified under $ 351 The assets had a tax basis to her of $500,000 and a fair market value of $700,000 on the date of the transfer. In the current year, Blue Corporation (E & Pof $1 million redeems 700 shares from Eleanor for $260,000 in a transaction that qualifies for sale or exchange treatment. With respect to the redemption, Eleanor will have a: a. $140,000 dividend. b. $260,000 dividend. c. $85,000 capital gain. d. $260,000 capital gain. PE