Journal entries for restructuring liabilities and subsequent expenditures. On December 31, 2007, Delhaize Group reported a balance

Question:

Journal entries for restructuring liabilities and subsequent expenditures. On December 31, 2007, Delhaize Group reported a balance in Restructuring Provisions of €50.9 million, of which €12.5 was expected to be paid in 2008, with the remainder to be settled during 2009-2010. The balance in this account at the start of the year was €84.0 million. During 2007, assume that Delhaize accrued restructuring charges of €14.2 million, and reversed €7.3 million of previous charges.

(a) Prepare all journal entries Delhaize made during 2007 related to its restricting activities.

(b) How will Delhaize report its Restricting Provision on its balance sheet for the year ended December 31, 2007?

(c) What is the effect of Delhaize’s 2007 restricting activities on its income statement? How are these activities displayed on the statement of cash flows? Ignore tax effects.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...