Reference no: EM131692291

Question - On May 4, 2016, Docker, Inc., purchased 650 shares of its own common stock in the market at a price of $18.50 per share. On September 19, 2016, 300 of these shares were sold in the open market at a price of $20.50 per share. There were 34,000 shares of Docker common stock outstanding prior to the May 4 purchase of treasury stock. A $0.45 per share cash dividend on the common stock was declared and paid on June 15, 2016.

Required:

a. Use the horizontal model on Docker's financial statements for the purchase of the treasury stock on May 4, 2016.

b. Use the horizontal model on Docker's financial statements for the declaration and payment of the cash dividend on June 15, 2016. (

c. Use the horizontal model on Docker's financial statements for the declaration and payment of the sale of the treasury stock on September 19, 2016.

Prepare the journal entries to record each of the above transactions.

a. The purchase of the treasury stock on May 4, 2016.

b. The declaration and payment of the cash dividend on June 15, 2016 (enter as a single entry rather than a compound entry).

c. The sale of the treasury stock on September 19, 2016.