Question: Red Tide County contributed two acres of land worth $500,000 to Misty Inc. in exchange for its commitment to develop a landfill. Which of the following is a true statement concerning this transaction?
A. Misty must issue stock to the county in exchange for the land.
B. The corporation's basis in the land is zero.
C. The corporation must recognize gain on the transaction.
D. The corporation's basis in the is $500,000.