James Corporation Exchanges a Building (Fair Market Value = $800,000,adjusted

Multiple Choice

James corporation exchanges a building (fair market value = $800,000,adjusted basis = $600,000) that has a $100,000 mortgage for another building owned by Pete Corporation (fair market value = $1,100,000,adjusted basis = $600,000) that is encumbered by a $400,000 mortgage.Each party assumed the mortgage on the building received.What are James's and Pete's realized gains on this exchange,respectively?

A) $200,000,$500,000
B) $200,000,$600,000
C) $500,000,$600,000
D) $500,000,$500,000
E) None of the above