Figure 1 shows the formula for calculating the number of subnets based on the bits borrowed from 1 bit borrowed all the way to 10 bits borrowed. Borrowing 10 bits gets you 2 to the power of 10 or 1024 subnets. Figure 2 shows the network address 10.0.0.0/18. The last three octets are in binary. The subnet mask is shown below the network address with the ten bits borrowed are now shown as one bits. Figure 3 shows the first five subnets and the last subnet created by borrowing 10 bits. The last three octets are shown in binary. Figure 4 shows the formula for calculating the number of valid hosts, which is 2 to the power of 14 minus 2 or 16,382. Figure 5 shows the network address, first host address, last host address, and broadcast address for the 10.0.0.0/18 subnet.