Meredith Company and Kyle Company were combined in a purchase transaction. Meredith was able to acquire Kyle at a bargain price. The sum of the market or appraised values of identifiable assets acquired less the fair value of liabilities assumed exceeded the cost to Meredith. A determination was made that some of the appraised values were overstated and those assets were adjusted accordingly. After reducing the overstated assets downward, there was still a “negative balance.” Proper accounting treatment by Meredith is to report the amount as

(a) An extraordinary item.

(b) Part of current income in the year of combination.

(c) A deferred credit.

(d) Paid in capital.