12. Employee Termination Benefits and Other Charges

During the three and six months ended December 28, 2012, the Company incurred charges to realign its operations with anticipated market demand. Total charges of $41 million and $67 million, respectively, were classified as operating expenses and included in employee termination benefits and other charges in the condensed consolidated statements of income for the three and six months ended December 28, 2012. The following table summarizes the Company’s employee termination benefits and other charges for the three and six months ended December 28, 2012 (in millions):


	Employee Termination Benefits			Impairment of Assets			Contract and Other Termination Costs			Total
Accrual at June 29, 2012	$	—		$	—		$	16		$	16
Charges		25			—			1			26
Cash payments		(22	)		—			(1	)		(23	)

Accrual at September 28, 2012	$	3		$	—		$	16		$	19

Charges		26			12			3			41
Cash payments		(13	)		—			(11	)		(24	)
Non-cash charges		(3	)		(12	)		—			(15	)

Accrual at December 28, 2012	$	13		$	—		$	8		$	21

The employee termination benefits relate to headcount reductions at various worldwide locations. The impairment of assets relates to machinery and equipment and an intangible asset at various locations worldwide. The liabilities for employee termination benefits and contract and other termination costs are expected to be relieved by the fourth quarter of fiscal 2013.