Benson Company experienced partial destruction of a warehouse from a tornado. The warehouse had a basis of \(\$ 200,000\) at the time of the casualty. Its fair market value before the accident was \(\$ 1,000,000\) and afterward, \(\$ 600,000\). How has this event changed the basis of the warehouse?

a. No effect

b. Decrease by \(\$ 200,000\)

c. Decrease by \(\$ 400,000\)

d. Decrease by \(\$ 100,000\) plus insurance proceeds received