Indigo corporation has a basis of $1 million in the stock of Owl Corporation, a subsidiary in which it owns 100% of all classes of stock. Indigo purchased the stock in Owl 10 years ago. In the current year, Indigo liquidates Owl and acquires assets worth $1.2 million. At the time of its liquidation, Owl Corporation had a basis of $800,000 in the assets and E&P of $500,000. Which of the following statements is correct with respect to the liquidation? a. Owl recognizes a gain of $400,000. b. Indigo has an $800,000 basis in the assets. c. Owl's E&P of $500,000 is eliminated. de trdijo recognizes gain of S200,000. e. None of these