National Supplys shareholders equity included the following accounts at December 31, 2023:

Shareholders' Equity
Common stock, 6 million shares at $1 par	$ 6,000,000
Paid-in capitalexcess of par	30,000,000
Retained earnings	86,500,000

Required:

National Supply reacquired shares of its common stock in two separate transactions and later sold shares. Prepare the entries for each of the transactions under each of two separate assumptions: the shares are (a) retired and (b) accounted for as treasury stock.

February 15, 2024	Reacquired 300,000 shares at $8 per share.
February 17, 2025	Reacquired 300,000 shares at $5.50 per share.
November 9, 2026	Sold 200,000 shares at $7 per share (assume FIFO cost).

Prepare the shareholders equity section of National Supplys balance sheet at December 31, 2026, assuming the shares are (a) retired and (b) accounted for as treasury stock. Net income was $14 million in 2024, $15 million in 2025, and $16 million in 2026. No dividends were paid during the three-year period.

Journal Entries:

1.Record the purchase of 300,000 shares at $8 per share on February 15, 2024 for retirement.

2. Record the purchase of 300,000 shares at $5.50 per share on February 17, 2025 for retirement.

3.Record the sale of 200,000 shares at $7 per share (assume FIFO cost) on November 9, 2026.

Treasury Stock Entries:

1.Record the purchase of 300,000 shares at $8 per share on February 15, 2024 that are accounted for as treasury stock.

2.Record the purchase of 300,000 shares at $5.50 per share on February 17, 2025 that are accounted for as treasury stock.

3.Record the sale of 200,000 shares at $7 per share (assume FIFO cost) on November 9, 2026.

Prepare the shareholders equity section of National Supplys balance sheet at December 31, 2026, assuming the shares are (a) retired and (b) accounted for as treasury stock. Net income was $14 million in 2024, $15 million in 2025, and $16 million in 2026. No dividends were paid during the three-year period.

Note: Enter your answers in whole dollars and not in millions.

Shareholders Equity	Retirement	Treasury stock
Paid-in capital:
Total shareholders equity	$0	$0