Ayanda plans to sell a depreciable asset to a corporation wholly owned by her husband. The characteristics of the asset are as follows:

FMV $3,000

Capital Cost 2,200

UCC 800

Which one of the following statements is true?

Select one:

A) The gain will be deferred due to the spousal rollover since the corporation is owned by Ayanda's husband.

B) Ayanda should file a section 85 election and elect a $2,200 to defer the tax on the sale.

C) Ayanda should file a section 85 election and elect $800 to defer the tax on the sale.

D) If a section 85 election is not made, the capital cost and UCC of the asset to the corporation will be $3,000.