PROBLEM NO. 1 Watusi Inc. began operations in January 2021 and reported the following results for each of its 3 years of operations. 2021 P260,000 net loss P40,000 net loss 2022 2023 P700,000 net income At December 31, 2023, Watusi Inc. share capital accounts were as follows. P500,000 Share Capital-Preference, 6% cumulative, par value P100; authorized, issued, and outstanding 5,000 shares 750,000 Share Capital-Ordinary, par value P1.00; authorized 1,000,000 shares; issued and outstanding 750,000 shares Watusi Inc. has never paid a cash or share dividend. There has been no change in the share capital accounts since Watusi began operations. The country law permits dividends only from retained earnings.

PROBLEM NO. 1 Watusi Inc. began operations in January 2021 and reported the following results for each of its 3 years of operations. 2021 P260,000 net loss P40,000 net loss 2022 2023 P700,000 net income At December 31, 2023, Watusi Inc. share capital accounts were as follows. P500,000 Share Capital-Preference, 6% cumulative, par value P100; authorized, issued, and outstanding 5,000 shares 750,000 Share Capital-Ordinary, par value P1.00; authorized 1,000,000 shares; issued and outstanding 750,000 shares Watusi Inc. has never paid a cash or share dividend. There has been no change in the share capital accounts since Watusi began operations. The country law permits dividends only from retained earnings.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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