To Improve Its Liquidity, the Shareholders of Spoonbill Corporation Make

To improve its liquidity, the shareholders of Spoonbill Corporation make a capital contribution of $200,000 in cash. To facilitate the building of a manufacturing plant, the City of Wichita donates land (worth $800,000) to Spoonbill Corporation. As a result of these transactions, Spoonbill has:

A) No income and a basis in the land of zero.
B) Income of $1 million and a basis in the land of zero.
C) Income of $800,000 and a basis in the land of $800,000.
D) No income and a basis in the land of $800,000.
E) None of the above.