Wills Corporation, Which Has Accumulated a Current E&P Totaling $70,000

Wills Corporation, which has accumulated a current E&P totaling $70,000, distributes land to its sole shareholder, an individual. The land has an FMV of $75,000 and an adjusted basis of $60,000. The shareholder assumes a $15,000 liability associated with the land. The transaction will have the following tax consequences.

A) The corporation will recognize a $15,000 gain; the shareholder will recognize dividend income of $60,000.
B) The corporation will recognize no gain; the shareholder will recognize dividend income of $60,000.
C) The corporation will recognize a $15,000 gain; the shareholder will recognize dividend income of $75,000.
D) The corporation will recognize no gain; the shareholder will recognize dividend income of $75,000.