Stiller Company, an 80% owned subsidiary of Leo Company, purchased land from Leo on March 1, 2012, for $75,000. The land originally cost Leo $25,000. Stiller reported net income of $125,000 and $140,000 for 2012 and 2013, respectively. In 2014, Stiller sold the land to an outside third party for $100,000. Leo uses the equity method to account for its investment. Compute the gain or loss recognized by Stiller in 2014.

$100,000 gain is recognized by Stiller.

0 gain or loss is recognized by Stiller.

None of the other choices are correct.

$25,000 gain is recognized by Stiller.

$75,000 is recognized by Stiller.