Van Winkle received incentive stock options $($ISOs$)$ from his employer, RiP, Inc. The options entitled Van to purchase $100$ shares of RiP common stock at an exercise price of $$20$ per share. Whe options vested when the market price of the stock was $$32$ per share. Van exercised his options on the vesting date. He sold the stock two years later for $$48$ per share. Assuming he meets the required holding periods to qualify for the tax treatment afforded incentive stock options, which of the following choices is correct?

Van will recognize $$1,200$ as ordinary income and $$1,600$ as long$-$term capital gain on the sale date.

Van's gain on the sale will be $$1,600$ long$-$term capital gain.

Van's gain on the sale will be $$2,800$ long$-$term capital gain.

Van would have recognized ordinary income of $$1,200$ on the exercise date.