Question 3 of 3 Current Attempt in Progress It is December 2020 and Wagner Inc recently...

    

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Question 3 of 3 Current Attempt in Progress It is December 2020 and Wagner Inc recently hired a new accountant, Jodie Larson Although Wagner is a private company, it follows IFRS. As part of her preparation of the 2020 financial statements for Wagner Inc. Jodie has proposed the following accounting changes. 1. 2 3. 4 5 4/15 E At December 31, 2019, Wagner had a receivable of $190,000 from Michael Inc. on its statement of financial position that had been outstanding since mid-2018 in December 2020, Michael Inc was declared bankrupt and no recovery is expected. Jodie proposes to write off the receivable in 2020 against retained earnings to correct a 2018 error Jodie proposes to change from double-declining balance to straight line depreciation for the company's manufacturing assets because of a change in the pattern in which the assets provide benefits to the company If straight-line depreciation had been used for all prior periods, retained earnings would have been $289,408 higher at December 31, 2019. The change's effect just on 2020 income is a $37,088 reduction For equipment in the leasing division, Jodie proposes to adopt the sum-of-the-years-digits depreciation method which the company has never used before. Wagner began operating its leasing division in 2020. If straight-line depreciation were to be used, 2020 income would be $83.600 higher Wagner has decided to adopt the revaluation method for reporting and measuring its land, with this policy being effective from January 1, 2020. At December 31, 2019, the land's fair value was $684,000. The land's book value at December 31, 2019, was $570,000 (Hint: Refer to IAS 8 for the treatment of this specific change in policy) Wagner has investments that are recorded at fair value through other comprehensive income (FV-OC At December 31 2019, an error was made in the calculation of the fair values of these investments. The amount of the error was an overstatement of the fair value by $152.000 Wagner's income tax rate is 30% (b) Prepare the required journal entries to record any adjustments. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation 1. 2. 3. Retained Earnings # : Debit Credit Seve for Later Using multiple attempts will impact your score Attempts: unlimited Submit Answer 5. Revaluation Surplus (OCI) No Entry Accounts Payable Fair Value-Ni Investments Deferred Tax Liability Accumulated Other Comprehensive Income Retained Earnings Deferred Tax Asset FV-OCI Investments Land Save for Later Using multiple attempts will impact your score. 30% score reduction after attempt 3 Attempts: unlimited Submit Answer (c) The parts of this question must be completed in order. This part will be available when you complete the part above. Question 3 of 3 Current Attempt in Progress It is December 2020 and Wagner Inc recently hired a new accountant, Jodie Larson Although Wagner is a private company, it follows IFRS. As part of her preparation of the 2020 financial statements for Wagner Inc. Jodie has proposed the following accounting changes. 1. 2 3. 4 5 4/15 E At December 31, 2019, Wagner had a receivable of $190,000 from Michael Inc. on its statement of financial position that had been outstanding since mid-2018 in December 2020, Michael Inc was declared bankrupt and no recovery is expected. Jodie proposes to write off the receivable in 2020 against retained earnings to correct a 2018 error Jodie proposes to change from double-declining balance to straight line depreciation for the company's manufacturing assets because of a change in the pattern in which the assets provide benefits to the company If straight-line depreciation had been used for all prior periods, retained earnings would have been $289,408 higher at December 31, 2019. The change's effect just on 2020 income is a $37,088 reduction For equipment in the leasing division, Jodie proposes to adopt the sum-of-the-years-digits depreciation method which the company has never used before. Wagner began operating its leasing division in 2020. If straight-line depreciation were to be used, 2020 income would be $83.600 higher Wagner has decided to adopt the revaluation method for reporting and measuring its land, with this policy being effective from January 1, 2020. At December 31, 2019, the land's fair value was $684,000. The land's book value at December 31, 2019, was $570,000 (Hint: Refer to IAS 8 for the treatment of this specific change in policy) Wagner has investments that are recorded at fair value through other comprehensive income (FV-OC At December 31 2019, an error was made in the calculation of the fair values of these investments. The amount of the error was an overstatement of the fair value by $152.000 Wagner's income tax rate is 30% (b) Prepare the required journal entries to record any adjustments. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation 1. 2. 3. Retained Earnings # : Debit Credit Seve for Later Using multiple attempts will impact your score Attempts: unlimited Submit Answer 5. Revaluation Surplus (OCI) No Entry Accounts Payable Fair Value-Ni Investments Deferred Tax Liability Accumulated Other Comprehensive Income Retained Earnings Deferred Tax Asset FV-OCI Investments Land Save for Later Using multiple attempts will impact your score. 30% score reduction after attempt 3 Attempts: unlimited Submit Answer (c) The parts of this question must be completed in order. This part will be available when you complete the part above.

Answer rating: 100% (QA)

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