Dena Owns 500 Acres of Farm Land in Southeastern Maryland

Multiple Choice

Dena owns 500 acres of farm land in southeastern Maryland.Her adjusted basis for the land is $480,000 and there is a $400,000 mortgage on the land.She exchanges the land for an office building owned by Chris in Newark,New Jersey.The building has a fair market value of $900,000.Chris assumes Dena's mortgage on the land.What is the amount of Dena's recognized gain or loss on the exchange?

A) $0
B) $400,000
C) $500,000
D) $820,000
E) None of these