Four Individuals Form Chickadee Corporation Under § 351 Both Jane and Walt Receive Stock in Chickadee Corporation Equal

Four individuals form Chickadee Corporation under § 351. Two of these individuals, Jane and Walt, made the following contributions: $\begin{array}{lll}&&\text { Fair Market }\\& \text { Adjusted Basis } & \text { Value }\\\text { From Jane-Cash} & \$ 360,000 & \$ 360,000 \\\text { Patent } & -0- & 40,000 \\\text {From Walt-Equipment (depreciation claimed of \( \$ 100,000 \) ) } &240,000 & 370,000\end{array}$ Both Jane and Walt receive stock in Chickadee Corporation equal to the value of their investments.

A) Jane must recognize income of $40,000? Walt has no income.
B) Neither Jane nor Walt recognize income.
C) Walt must recognize income of $130,000? Jane has no income.
D) Walt must recognize income of $100,000? Jane has no income.
E) None of these.