Briggs and Stratton form BS Constuction Corporation. Briggs transfers property (basis of $105,000 and fair market value of $90,000) while Stratton transfers land (basis of $8,000 and fair market value of $75,000) and $15,000 of cash. Each receives 50% of BS Construction Corporation's stock (total value of $180,000). As a result of these transfers, which of the following is true?
1) Briggs has a recognized loss of $15,000, and Stratton has a recognized gain of $67,000.
2) Neither Briggs nor Stratton has any recognized gain or loss.
3) Briggs has no recognized loss, but Stratton has a recognized gain of $15,000.
4) BS Construction Corporation will have a basis in the land of $23,000.
