What is the proper GAAP accounting treatment in converting from an LLC to a C-Corp?

Here's what my question comes down to.  LLCs pass gains and losses along to their members (at least for tax purposes).  When an LLC converts to a C-Corp, does GAAP say you bring the equity over to the C-corp as common stock (par and apic) based on:

1. Gross amounts, as though the company had always been a C-corp, with retained earnings being the (previously passed through) losses from the company's inception; -OR-
2. Net amounts, such that common stock is reflected as the total of all LLC capital accounts on the conversion date; and with a zero retained earnings because the losses have all been passed out of the company to the members.

The company history is basically this (in round numbers):

1. Started 6/15/2010 with calendar year reporting and $100,000 cash investment
2. $60,000 losses in 2010
3. $42,000 losses in 2011 through Nov. 30
4. Converted to LLC on December 1, 2011

This happened in Colorado, where an LLC can directly convert to a C-corp.  So it's the same legal entity, just with a different corporate form.  Option 1 appeals to me intuitively as presenting a clean picture to investors reflective of the current corporate form.  Tax books would of course look different from GAAP, which they will anyway.  There's a dearth of information on how to do this so any input would be great.  (Or even educated guesses!)>