Pursuant to a complete liquidation, Oriole Corporation distributes to its share holders land held for three years as an investment (adjusted basis of $250,000, fair market value of $490,000). The land is subject to a liability of $520,000.

a. What are the tax consequences to Oriole Corporation on the distribution of the land?

b. If the land is, instead, subject to a liability of $400,000, what are the tax consequences to Oriole on the distribution?