Alan, Bob and Carly create a corporation. After the incorporation, Alan receives 25% of the corporations stock in exchange for services and intangibles. The stock was valued at $150,000. The services were valued at $125,000 and the intangibles were valued at $25,000. Bob and Carly receive the remaining 75% of the corporation valued at $450,000 in exchange for equipment with basis of $200,000 and a fair market value of $400,000. How much gain will Bob and Carly recognize on the 351 exchange?

A. $250,000 since the Alan did not transfer property for stock

B. $0, since this transfer is subject to the non-recognition rule of 351

C. $150,000

D. $200,000