Wade and Paul form Swan Corporation with the following investments. Wade transfers machinery (basis of $40,000 and fair market value of $100,000) and Paul transfers land (basis of $20,000 and fair market value of $90,000) and services rendered (worth $10,000) in organizing the corporation. Each is issued 25 shares in Swan Corporation. With respect to the transfers:

A. Neither Wade nor Paul has recognized gain or income on the transfers.

B. Paul has a basis of $30,000 in the 25 shares he acquires in Swan Corporation.

C. Wade has no recognized gain; Paul recognizes income/gain of $80,000.

D. Swan Corporation has a basis of $30,000 in the land transferred by Paul.