Harold Purchases Land and a Building by Paying Cash of $35,000

Multiple Choice

Harold purchases land and a building by paying cash of $35,000, and assuming the seller's $82,000 mortgage. In addition, Harold pays $3,000 of legal fees related to the purchase. For property tax purposes, the land is valued at $17,000 and the building at $34,000. Harold's basis in the building is

A) $17,000
B) $34,000
C) $40,000
D) $80,000
E) $120,000