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3167822523

# 3167822523 - Problem 18-2 Requirement 1 a February 5 2006(\$...

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Problem 18-2 Requirement 1 a. February 5, 2006 (\$ in millions) * Paid-in capital – excess of par: \$1,680 ÷ 240 b. July 9, 2006 c. November 14, 2008 Retirement Treasury Stock Common stock (6 million sh. x \$1) 6 Treasury stock (6 million sh. x \$10) 60 Paid-in capital – excess of par Cash 60 (6 million shares x \$7 * ) 42 Paid-in capital – share repurchase 1 Retained earnings (plug) 11 Cash 60 Cash (2 million sh. x \$12) 24 Cash (2 million sh. x \$12) 24 Common stock (2 million sh. x \$1) 2 Treasury stock (2 million sh. x \$10) 20 Paid-in capital – excess of par 22 Paid-in capital–sh. repurchase 4

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Problem 18-2 (concluded) Requirement 2 Treasury Retirement Stock Paid-in capital: Common stock, 240 million shares at \$1 par, ............... \$ 238 \$ 240 Paid-in capital – excess of par ....................................... 1,672 * 1,680 Paid-in capital – share repurchase .................................. 0 0 Retained earnings ......................................................... 1,089 ** 1,099 *** Less: treasury stock, 2 million shares (at cost) ........... (20 ) Total shareholders’ equity ............................................. \$2,999 \$2,999 * 1,680 - 42 + 22 + 12 ** 1,100 - 11 *** 1,100 - 1 or, alternatively: Paid-in capital: Common stock, 240 million shares at \$1 par, ............... \$ 238 \$ 240 Additional paid-in capital ............................................... 1,672 * 1,680 Retained earnings ......................................................... 1,089 ** 1,099 *** Less:
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