Paula receives a liquidating distribution from Pell Corporation as part of a redemption of all of its stock. Paula's basis for her Pell stock is $10,000. In exchange for her stock, Paula receives property with an $8,000 basis and a $15,000 fair market value that is subject to a $2,000 mortgage, and also receives cash of $5,000. How much is Paula's recognized gain?
A. $12,000.
B. $10,000.
C. $8,000.
D. $0.