Summarize How the Following Information About Crank Corp

question 61

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)On March 15,2010 Crank Corp.announced its restructuring and recognized a restructuring charge of $845,000.
(2)The tax effect of the restructuring charge was estimated to be $230,000.
(3)Crank determined 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 lessors for lease terminations in 2010 equal to $78,000.
(6)The tax effect of the severance payments and lease cancellations was $19,000.

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Definitions:

Nasogastric (NG) Tube

A flexible tube inserted through the nose into the stomach for feeding or drainage purposes.

Residual Volume

The volume of air remaining in the lungs after a forced exhalation, ensuring gas exchange continues even between breaths.

Irrigation

The process of cleaning a wound or body part by flushing with water or a medical solution to remove debris and infections.

Nasogastric Irrigant

A solution used to flush or clear a nasogastric tube, which is a tube inserted through the nose down into the stomach.