Reference no: EM132686896

Problem - D-Mobile Wireless needed additional capital to expand, so the business incorporated. The charter from the state of Georgia authorizes D-Mobile to issue 50,000 shares of 8%, $50 par value cumulative preferred stock and 160,000 shares of $4 par value common stock. During the first month, D-Mobile completed the following transactions:

Oct. 2 Issued 19,000 shares of common stock for a building with a market value of $240,000.

Oct. 6 Issued 600 shares of preferred stock for $140 per share.

Oct. 9 Issued 11,000 shares of common stock for cash for $5 per share.

Oct. 10 Declared a $19,000 cash dividend for stockholders of record on Oct. 20. Use a separate Dividends Payable account for preferred and common stock.

Oct. 25 Paid the cash dividend. Purchased 600 shares of the company's common stock, paying cash of $6 per share.

Requirements -

1. Record the transactions by preparing journal entries in the general journal.

2. Prepare the stockholders' equity section of D-Mobile's balance sheet at October 31, 2018. Assume D-Mobile's net income for the month was $94,000.