To induce Yellow Corporation to build a new manufacturing facility in Knoxville, Tennessee, the city donates land $($fair market value of $$400,000)$ and cash of $$100,000$ to the corporation. Several months after the donation, Yellow Corporation spends $$450,000($which includes the $$100,000$ received from Knoxville$)$ on the construction of a new plant located on the donated land.

a$.$ Yellow recognizes income of $$100,000$ as to the donation.

b$.$ Yellow recognizes income of $$500,000$ as to the donation.

c$.$ Yellow has a zero basis in the land and a basis of $$350,000$ in the plant.

d$.$ Yellow has a zero basis in the land and a basis of $$450,000$ in the plant.