Analyzing and Interpreting Restructuring Costs and Effects General Electric (GE) reports the following note disclosure (excerpted) in its current year 10-K relating to its restructuring program. RESTRUCTURING: Restructuring actions are an essential component of our cost improvement efforts to both existing operations and those recently acquired. Restructuring and other charges relate primarily to workforce reductions, facility exit costs associated with the consolidation of sales, service, and manufacturing facilities, the integration of recent acquisitions, and other asset write-downs. We continue to closely monitor the economic environment and may undertake further restructuring actions to more closely align our cost structure with earnings and cost reduction goals. Restructuring and Other Charges (In billions) Current Year Prior Year Two Years Prior Workforce reductions $3.6 $4.8 $5.2 Plant closures & associated costs and other asset write-downs 7.2 7.6 5.2 Acquisition/disposition net charges 3.2 3.2 2.4 Other 0.4 0.8 1.2 Total $14.4 $16.4 $14.0 Required a. Classify the following costs as either a cash charge or a noncash charge associated with corporate restructuring activities. Costs Cash charge *Employees laid off (also called severance pay) Cash charge Fees paid to lawyers and consultants Noncash charge Fixed-asset write-downs Noncash charge Impairment charges on intangible assets Noncash charge Losses (or gains) on asset disposals b. Using the financial statement effects template, show the effects on financial statements of the current year restructuring charge of $14.4 billion. Assume that in the current year, the Workforce reductions were accrued and all other charges were paid in cash. Note: Use negative signs with answers when appropriate. Note: If an answer field is not needed, leave it blank (not all answer fields will be used). BALANCE SHEET INCOME STATEMENT Transaction ($ billions) Cash Asset Noncash Assets Liabilities Contributed Capital Earned Capital Revenue Expenses Net Income Record restructuring charge: $ * $ Ov $ * $ Ov $ * $ Ov $ * $ #x N/A #x N/A #x N/A