Tony and Janice have been married and living together in Tony's home for 5 years. He lived in the home alone for 20 years prior to their marriage. They sell the home, which has an adjusted basis of $80,000, for $450,000. Tony and Janice plan to use the § 121 exclusion (exclusion of gain on sale of principal residence). In Janice's prior marriage to Dan, Dan sold his principal residence and used the §121 exclusion. Janice and Dan filed joint returns during their years of marriage. Tony and Janice purchase a replacement residence for $200,000 one month after the sale. What is the recognized gain and basis for the new home?

a) $0; $80,000.

b) $0; $200,000.

c) $120,000; $200,000.

d) $370,000; $200,000.