QUESTION 5 P forms S to acquire the stock of T. S merges with and into T, with T surviving as a subsidiary of P. The T shareholders have a zero tax basis in their stock of T. In the transaction, the T shareholders receive P voting common stock with a value of $80,000 and cash of $20,000. Which is true regarding the tax treatment of the transaction (select the best answer): O A. Parent recognizes gain on the formation of S. O B. P's tax basis in the T stock immediately after the merger equals the net asset basis of T. O C. The T shareholders recognize gain/income equal to $20,000. O D. (A) and (C) O E. (B) and (C)