On July 1, 20X1, James and Short formed a partnership. James contributed cash. Short, previously a sole proprietor, contributed property other than cash, including realty subject to a mortgage, which the partnership assumed. Short’s capital account on July 1, 20X1, should be recorded at

a. Short’s book value of the property on July 1, 20X1.

b. Short’s book value of the property less the mortgage payable on July 1, 20X1.

c. The property’s fair value less the mortgage payable on July 1, 20X1.

d. The property’s fair value on July 1, 20X1.