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.

Suggestion: Use value analysis to guide your calculations and entries.