Answer:
The total paid-in capital declines by $17 million
Explanation:
The necessary entries to record the repurchase of shares are as follows:
Dr Common stock $1*2,000,000 $2,000,000
Dr Paid-in capital in excess of par
1120*140*2000,0000 $ 16,000,000
Cr Cash $7*2000,000 $14,000,000
Cr Share repurchase(balancing figure) $4,000,000
Invariably, the paid-in capital declines by the difference the total of common stock and paid-in capital in excess of par ($2m+$16m) and the share repurchase,hence the it declines by $17 million
