Harry Owed $10,000 to His Employer

Harry owed $10,000 to his employer. The employer forgave the indebtedness due to Harry's hard work. Also, Harry allowed the holder of the mortgage on his vacation home to foreclose on the property. Although Harry is solvent, he wanted to get out from under the indebtedness. Therefore, the vacation home, which had a fair market value of $200,000, an original cost of $180,000, and a mortgage encumbering the property of $200,000, was surrendered. How much gross income resulted from these events?

A) $- 0 -
B) $10,000
C) $20,000
D) $30,000
E) $210,000