Summarize How the Following Information About Crank Corp $\$ 845$

question 32

Essay

Summarize how the following information about Crank Corp.'s restructuring would affect the balance sheet and income statement summary chart below. Crank Corp.'s restructuring will take approximately 18 months and was announced on March 15, 2010:
(1) OnMarch 15, 2010 Crank Corp. announce dits restructuring and recognized a re structuring charge of $\$ 845$ ,000.
(2) The tax effect of the restructuring charge was estimated to be $\$ 230,000$ .
(3) Crank detemined that the cost of disposing and removing facilities and equipment during 2010 $\$ 312,000$ .
(4) The tax effect associated with the disposal and removal of facilities and equipment are $\$ 95,000$ .
(5) Crank Corp. made cash payments to severed employees and le ssors for lease terminations in 2010 equal to $\$ 78,000$ .
(6) The tax effect of the severance payments and lease cancellationswas $\$ 19,000$ .

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Definitions:

War

A state of armed conflict between different countries or different groups within a country.

Merger

The combination of two or more companies into one, either by closing the old entities into one new entity or by one company absorbing the others.

Rule Of Reason

A legal doctrine used in antitrust law to determine if a business practice is anti-competitive, considering if it has legitimate business purposes and its overall impact on competition.

Case

A specific instance or example of something, often used to study or illustrate a particular issue or principle.