The following is from the most recent 10-K report of 3M Company for the year ended December 31, 2017. 3M COMPANY AND SUBSIDIARIES Consolidated Statement of Income (Millions, except per share amounts) Net sales. . . Operating expenses Costs of sales.. Selling, general and administrative expenses Research, development and related expenses Gain on sale of businesses. Total operating expenses Operating income.. Other expense (income), net.. Income before income taxes Provision for income taxes.. Net income including noncontrolling interest.. 2017 $31,657 16,001 6,572 1,850 (586) 23,837 7,820 272 7,548 2,679 $ 4,869 In its footnotes, 3M provided the following information about the gain on sale of businesses in the income statement. Gain on Sale of Businesses: In 2017, 3M sold the assets of its safety prescription eyewear business, completed the related sale or trans- fer of control, as applicable, of its identity management business, sold its tolling and automated license/ number plate recognition and electronic monitoring businesses, and sold the assets of its electrical marking/ labeling business. On a combined basis, these divestitures resulted in a gain on the sale of businesses of $586 million. In addition, 3M provided information about restructuring charges for fiscal year 2017: 2017 Restructuring Actions: During the second quarter of 2017, management approved and committed to undertake certain restructur- ing actions primarily focused on portfolio and footprint optimization. These actions affected approximately 1,300 positions worldwide and resulted in a second quarter 2017 pre-tax charge of $99 million. Remaining activities related to restructuring are expected to be completed by the end of 2018. Restructuring charges are summarized by business segment as follows: (Millions) Industrial. . . . Safety and graphics Health care.. Electronics and energy. . Consumer.... Corporate and unallocated. Total expense.. Second Quarter 2017 Employee-Related $39 9 2 7 36 $99 The preceding restructuring charges were recorded in the income statement as follows: (Millions) Cost of sales.. Selling, general and administrative expenses. Research, development and related expenses. Total. Restructuring actions, including cash and non-cash impacts, follow: (Millions) Expense incurred in the second quarter of 2017. Cash payments. Adjustments. Accrued restructuring action balances as of December 31, 2017. Second Quarter 2017 $86 5 8 $99 Employee-Related $99 (8) (3) $88 REQUIRED a. b. C. Describe where on the income statement the above described restructuring charges and gain on sale of businesses are included. Describe how an analyst of the company should treat these items when making financial state- ment projections. What incentives might management have to either overstate or understate the above described restructuring charges? Describe how future financial statements would be affected if the costs were overstated or understated when these charges were recorded in 2017.