Arthur Owns a Tract of Undeveloped Land (Adjusted Basis of $145,000)

Multiple Choice

Arthur owns a tract of undeveloped land (adjusted basis of $145,000) that he sells to his son, Ned, for its fair market value of $105,000.What is Arthur's recognized gain or loss and Ned's basis in the land?

A) $0 and $105,000.
B) $0 and $145,000.
C) ($40,000) and $105,000.
D) ($40,000) and $145,000.