Problem

Treasury stock transactions On May 4, 2010, Docker, Inc., purchased 800 shares of its own...

Treasury stock transactions On May 4, 2010, Docker, Inc., purchased 800 shares of its own common stock in the market at a price of $18.25 per share. On September 19, 2010, 600 of these shares were sold in the open market at a price of $19.50 per share. There were 36,200 shares of Docker common stock outstanding prior to the May 4 purchase of treasury stock. A $0.35 per share cash dividend on the common stock was declared and paid on June 15, 2010.

Required:

Use the horizontal model (or write the entry) to show the effect on Docker’s financial statements of

a. the purchase of the treasury stock on May 4.


b. the declaration and payment of the cash dividend on June 15.


c. the sale of the treasury stock on September 19.

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