Reconstructing transactions affecting shareholders' equity. Exhibit 14.11 reproduces a portion of the statement of changes in shareholders equity for Microsoft Corporation for 2007. When Microsoft repurchases its common stock, it cancels the outstanding shares. Prepare journal entries for each of the seven listed transactions in Exhibit 14.11. Record the effect of items affecting accumulated other comprehensive income using the amounts in Exhibit 14.11 (that is, treating those net-of-tax amounts as if they were pretaxamounts).

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Microsoft Corporation Excerpt from Statement of Changes in Shareholders' Equity (amounts in millions) (Problem 35) EXHIBIT 14.11 2007 Common Stock and Additional Paid-In Capital Balance, Beginning of Year $59,005 (1) Common Stock Issued (2) Common Stock Repurchased 6,783 (6,162) (3) Stack-Based Compensation Expense 889 Other . 42 $ 60,557 Balance, End of Year Retained Earnings Balance, Beginning of Year $(20,130) (4) Net Income 14,065 (5) Common Dividends (3,837) (2) Common Stock Repurchased (21,212) .$(31,114) Balance, End of Year .... Accumulated Other Comprehensive Income Balance, Beginning of Year 1,229 (6) Net Change in Unrealized Gains and Losses on Marketable Securities (net of taxes) 326 (7) Net Change in Unrealized Gains and Losses on Derivatives (net of taxas). Net Change in Foreign Currency Translation Adjustment (net of taxes) Balance, End of Year.. 14 85 S 1,654 Comprehensive Income Net Income. Net Change in Accumulated Other Comprehensive Income Comprehensive Income .. $ 14,065 425 $ 14,490