The Dow Chemical Corporation announced a restructuring plan in 2016 which incorporated actions related to the recent ownership restructure of Dow Corning Corporation. The following footnote (excerpted) of the Company comes from the December 31, 2016 financial statements:
2016 Restructuring
On June 27, 2016, the Board of Directors of the Company approved a restructuring plan that incorporates actions related to the recent ownership restructure of Dow Corning Corporation ("Dow Corning"). These actions, aligned with Dow's value growth and synergy targets, will result in a global workforce reduction of approximately 2,500 positions, with most of these positions resulting from synergies related to the Dow Corning transaction. These actions are expected to be substantially completed by June 30, 2018.
As a result of these actions, the Company recorded pretax restructuring charges of $449 million in the second quarter of 2016 consisting of severance charges of $268 million, asset write-downs and write-offs of $153 million and costs associated with exit and disposal activities of $28 million. The impact of these charges is shown as "Restructuring charges (credits)"
in the consolidated statements of income and reflected in the Company's segment results in the table that follows. The table also summarizes the activities related to the Company's 2016 restructuring reserve, which is included in "Accrued and other current liabilities"
and "Other noncurrent obligations"
in the consolidated balance sheets.
The following table summarizes the activities related to the Company's restructuring reserve (liability):

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Required:
a. Explain why Dow Chemical planned this restructuring. When did the company record the restructuring expense? When will the restructuring take place? Explain the difference.
b. What are the three types of restructuring costs for Dow Chemical for 2016?
c. Explain why no cash is involved in settling the impairment of long-lived assets portion of the restructuring reserve.
d. Dow Chemical managers estimated all of the charges above. What would be the income-statement consequences next year (in 2017) if only $100 million of additional cash payments were necessary to completely settle the employee severance costs? Assume that Dow Chemical did not intentionally overestimate these severance costs.

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