LO.5 Seagull Corporation owns three machines that it uses in its business. It no longer needs two of these machines and is considering distributing them to its two shareholders as a property dividend. All three machines have a fair market value of $40,000 each. The basis of each machine is as follows: Machine A, $47,000; Machine B, $40,000; and Machine C, $32,000. The corporation has asked you for advice. What do you recommend?