Chapter 11, Problem 11.14E

Preparing the Stockholders’ Equity Section of the Balance Sheet and Evaluating Dividend Policy

The following account balances were selected from the records of TAC Corporation at the end of the fiscal year after all adjusting entries were completed:

Common stock ($20 par value; 100,000 shares authorized, 34,000 shares issued, 32,000 shares outstanding)	$680,000
Additional paid-in capital	163,000
Dividends declared and paid during the year	16,000
Retained earnings at the beginning of the year	75,000
Treasury stock at cost (2,000 shares)	(25,000)

Net income for the year was $30,000. The stock price is currently $22.29 per share.

Required:

1. 1. Prepare the stockholders’ equity section of the balance sheet at the end of the fiscal year.
2. 2. Compute and evaluate the dividend yield ratio. Determine the number of shares of stock that received dividends.