Julian Transferred 100 Percent of His Stock in Lemon Company

Julian transferred 100 percent of his stock in Lemon Company to Apricot Corporation in a Type B stock-for-stock exchange. In exchange, he received stock in Apricot with a fair market value of $385,000. Julian's tax basis in the Lemon stock was $770,000. What amount of loss does Julian recognize in the exchange and what is his basis in the Apricot stock he receives?

A) $385,000 loss recognized and a basis in Apricot stock of $385,000
B) No loss recognized and a basis in Apricot stock of $770,000
C) $385,000 loss recognized and a basis in Apricot stock of $770,000
D) No loss recognized and a basis in Apricot stock of $385,000