It is December 2017 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 2017 financial statements for Wagner Inc., Jodie has proposed the following accounting changes.
1. At December 31, 2016, Wagner had a receivable of $250,000 from Michael Inc. on its statement of financial position that had been outstanding since mid-2015. In December 2017, Michael Inc. was declared bankrupt and no recovery is expected. Jodie proposes to write off the receivable in 2017 against retained earnings as a correction of a 2015 error.
2. 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 $380,800 higher at December 31, 2016. The change's effect just on 2017 income is a reduction of $48,800.
3. 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 2017. If straight-line depreciation were to be used, 2017 income would be $110,000 higher.
4. Wagner has decided to adopt the revaluation method for reporting and measuring its land, with this policy being effective from January 1, 2017. At December 31, 2016, the land's fair value was $900,000. The land's book value at December 31, 2016 was $750,000.
5. Wagner has investments that are recorded at fair value through other comprehensive income (FV-OCI). At December 31, 2016, 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 $200,000.
Wagner's income tax rate is 30%.
Instructions
(a) For each of the changes described above, identify whether the situation is a change in policy, a change in estimate, or an error correction. Justify your answer.
(b) For each of the changes described above, determine whether a restatement of the January 1, 2017 retained earnings is required. What is the amount of the adjustment, if any? Prepare the required journal entries to record any adjustments.
(c) Prepare the contents of the statement of changes in equity for 2016 and 2017 following the format below. An excerpt from the statement of changes in equity for December 31, 2016 is provided below:

For 2017, net income is $1,350,000 and other comprehensive income is $150,000 (relating to the change in value of the FV-OCI Investment during 2017). There were no shares issued or repurchased during the year. There are no other changes to the equity accounts for 2017.
(d) Identify what disclosures are required in the notes to the financial statements as a result of each of these changes.

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Accumulated Other Share Capital Retained Coprehensive Income Earnings Investments at FV-ocI Opening January 1, 2016 $1,000,000 $2,500,000 Comprehensive income $650,000 $4,150,000 475,000 1,385,000 910,000 Closing balance December 31, 2016 $1,000,000 $3,410,000 $1,125,000 $5,535,000