I. “When we turned around […]” expresses an action in progress in the past.
II. “When we turned around […]” is in the simple past.
III. “When we turned around […]” is in the past continuous.
IV. “When we turned around […]” expresses an instant event in the past.

(A)
Sentences I and II are correct.

(B)
Sentences I and III are correct.

(C)
Sentences II and III are correct.

(D)
Sentences II and IV are correct.