Norton Corporation agrees to acquire the net assets of Payco Corporation. Just prior to the acquisition, Payco€™s balance sheet is as follows:

Fair values agree with book values except for the equipment, which has an estimated fair value of $40,000. Also, it has been determined that brand-name copyrights have an estimated value of $15,000. Norton Corporation pays $25,000 in acquisition costs to consummate the transaction.
Record the acquisition on the books of Norton Corporation assuming the cash paid to Payco Corporation is $160,000.

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Payco Corporation Balance Sheet January1, 2011 Assets Liabilities and Equity Accounts receivable Inventory Equipment (net $200,000 Current liabilities 270,000 Morigage payoble 100,000 Stockholders' equity: 80,000 250,000 $330,000 $100,000 Common stock I$10 par Retained earnings. 140,000 240,000 $570,000 Total assets. ..._ .. .. $570,000 Total liabilties and equity