Kristine owns all of the stock of a C corporation which owns the following assets.

	Adjusted Basis	Fair Market Value
Accounts receivable	$ 0	$ 60,000
Inventory	20,000	30,000
Machinery and equipment*	50,000	90,000
Buildings**	120,000	170,000
Land	80,000	140,000
	$270,000	$490,000

* Potential 1245 recapture of $45,000. ** Straight-line depreciation was used. Her adjusted basis for her stock is $270,000. Calculate Kristine's recognized gain or loss and classify it as capital or ordinary if she sells her stock for $500,000.

a.$230,000 capital gain.

b.$230,000 ordinary income.

c.$110,000 ordinary income and $120,000 capital gain.

d.$115,000 ordinary income and $115,000 capital gain.