John, Mark, Steve, and Tom organize the JMS&T Corporation by transferring the following Transferor's Fair AdjustedMarketConsideration Transferor John Mark Steve Tom Asset Land Equipment $35,000 $40,000 22 shares of stock Tools Basis $50,000 Value Received 37 shares of stock $70,000 $45,000 $35,000 $40,000$40,000 19 shares of stock 22 shares of stock 100 shares total The land contributed by John is subject to a mortgage in the amount of $30,000. JMS&T Corporation assumes John's following is correct? mortgage on the land. The 100 shares represent all of the outstanding stock of JMS&T Corporation. Which of the A. The exchange qualifies for IRC Sec 351 nontaxable treatment, but John must recognize $30,000 of capital gain B. The exchange qualifies for IRC Sec. 351 nontaxable treatment C. The exchange qualifies for IRC Sec. 351 nontaxable treatment but John must recognize S20000 of capital gain D. The exchange does not qualify for IRC Sec. 351 nontaxable treatment