During 2021, Sandhill Company purchased the net assets of Indigo Corporation for $2222000. On the date of the transaction, Indigo had $606000 of liabilities. The fair value of Indigo's assets when acquired were as follows:

Current assets	$1090800
Noncurrent assets	2545200
	$3636000

How should the $808000 difference between the fair value of the net assets acquired ($3030000) and the cost ($2222000) be accounted for by Sandhill?

The $808000 difference should be recognized as a gain.

The $808000 difference should be credited to retained earnings.

The current assets should be recorded at $1090800 and the noncurrent assets should be recorded at $1737200.

A deferred credit of $808000 should be set up and then amortized to income over a period not to exceed forty years.