Waco Wireless needed additional capital to expand, so the business incorporated. The charter from the state of Georgia authorizes Waco to issue 80,000 shares of 10%, $100 par value cumulative preferred stock, and 120,000 shares of $3 par value common stock. During the first month, Waco completed the following transactions:

10/2 Issued 20,000 shares of common stock for a building with a market value of $150,000

10/6 Issued 700 shares of preferred stock for $120 per share.

10/9 Issued 15,000 shares of common stock for cash of $60,000.

10/10 Declared a $20,000 cash dividend for stockholders of record on Oct. 20. Use a separate Dividends Payable account for preferred and common stock.

10/25 Paid the cash dividend.

Requirements:

1. Record the transactions in the general journal.

2. Prepare the stockholders' equity section of Waco's balance sheet at October 31, 2016. Assume Waco's net income for the month was $91,000.