During the current year, Ecru Corporation is liquidated and distributes its only asset, land, to Kena, the sole shareholder. On the date of distribution, the land has a basis of $40,000 and a fair market value of $ 50,000. Kena has a basis of $120,000 in the Ecru stock. With respect to the distribution of the land, which of the following statements is correct?

a. Kena recognizes a gain of $200,000

b. Kena recognizes a gain of $10,000

c. Kena recognizes a loss of $70,000

d. Kena recognizes $0 gain or loss.