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what size and timber type do I need for a new support beam? Looking at that yellow/orange picture it looks like it may be a 4x12???
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You would have to ask the local AHJ about spanning, but I would think 4 x 12 (I assume you mean 2, 2x12's) would be enough, but again...ask the building dept. in your area.
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Also, what should I use for the new studs that would support this new beam? Would it be 2 2x4's?
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2 2x4 king studs should do but again...well

same rules as before.....don't take my word for it.
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Do I extend these new studs all the way to the floor or do they stop at the 2x4 running parallel to the floor?
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Support everything from the ground. Meaning, any bearing wall should have a direct "path" to the foundation. Don't rely on a wall more than a couple feet away to hold up the next bearing wall (or roof, or whatever's up there)
EDIT: BTW, don't forget the extra plywood sandwiched between the 2 2x12's or the width will be off.