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Caramel Corporation has 5,000 shares stock outstanding. In a qualifying stock redemption, Caramel distributes $145,000 in exhange for 1,000 of its shares. At the time
Caramel Corporation has 5,000 shares stock outstanding. In a qualifying stock redemption, Caramel distributes $145,000 in exhange for 1,000 of its shares. At the time of the redemption , Caramel has paid-in-capital of $800,000 and E&P of $300,000.
The results of this redemption is a $___________ charge to E&P and a $____________ reducation of Caramel's paid-in-capital account.
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