The following account balances were selected from the records of TEAC Corporation at December 31, 2011, after

Question:

The following account balances were selected from the records of TEAC Corporation at December 31, 2011, after all adjusting entries were completed:

Common stock (par $20; authorized 100,000 shares, issued

34,000 shares, of which 2,000 shares are held as treasury stock) $680,000

Capital in excess of par 163,000

Dividends declared and paid in 2011 16,000

Retained earnings, January 1, 2011 75,000

Treasury stock at cost (2,000 shares) 25,000

Net income for the year was $30,000. Restriction on retained earnings equal to the cost of treasury stock held is required by law in this state. The stock price is currently $22.29 per share.

Required:

1. Prepare the Stockholders’ Equity section of the balance sheet at December 31, 2011.

2. Compute and evaluate the dividend yield ratio. Determine the number of shares of stock that received dividends.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Corporation
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A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...