In a Business Combination That Occurred 2 Years Ago, There

In a business combination that occurred 2 years ago, there was a fair value adjustment due to land as the fair value was greater than its recorded book value by $20,000. The company's tax rate is 40%. What is the required adjustment upon consolidation this year?

A) There is no required adjustment upon consolidation.
B) Increase the carrying value of land by $20,000 and increase the deferred tax liability of $8,000.
C) Increase the carrying value of land by $12,000
D) Recognize goodwill for $20,000

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