6. Contracts in Process

The components of contracts in process are presented in the table below.

	September 29, 2017			December 31, 2016
	(in millions)
Unbilled contract receivables, gross	$	1,965		$	2,020
Unliquidated progress payments		(710	)		(827	)
Unbilled contract receivables, net		1,255			1,193
Inventoried contract costs, gross		1,101			1,065
Unliquidated progress payments		(83	)		(203	)
Inventoried contract costs, net		1,018			862
Total contracts in process	$	2,273		$	2,055

Inventoried Contract Costs. In accordance with contract accounting standards, the Company’s U.S. Government contractor businesses account for the portion of their general and administrative (G&A), independent research and development (IRAD) and bids and proposal (B&P) costs that are allowable and reimbursable indirect contract costs under U.S. Government procurement regulations on their U.S. Government contracts (revenue arrangements) as inventoried contract costs. G&A, IRAD and B&P costs are allocated to contracts for which the U.S. Government is the end customer and are charged to costs of sales when sales on the related contracts are recognized. The Company’s U.S. Government contractor businesses record the unallowable portion of their G&A, IRAD and B&P costs to expense as incurred, and do not include them in inventoried contract costs.

The table below presents a summary of G&A, IRAD and B&P costs included in inventoried contract costs and the changes to them, including amounts charged to cost of sales by the Company’s U.S. Government contractor businesses for the periods presented.

	Third Quarter Ended						Year-to-Date Ended
	September 29, 2017			September 23, 2016			September 29, 2017			September 23, 2016
	(in millions)
Amounts included in inventoried contract costs at beginning of the period	$	174		$	163		$	173		$	137
Contract costs incurred:
IRAD and B&P		89			76			246			213
Other G&A⁽¹⁾		219			201			671			611
Total		308			277			917			824
Amounts charged to cost of sales		(303	)		(270	)		(911	)		(791	)
Amounts included in inventoried contract costs at end of the period	$	179		$	170		$	179		$	170

⁽¹⁾

Amounts include severance and restructuring related costs of $31 million and $4 million for the quarterly periods ended September 29, 2017 and September 23, 2016, respectively, and $54 million and $9 million for the year-to-date periods ended September 29, 2017 and September 23, 2016, respectively.

The table below presents a summary of selling, general and administrative expenses and research and development expenses for the Company’s commercial businesses, which are expensed as incurred and included in cost of sales on the unaudited condensed consolidated statements of operations.

	Third Quarter Ended				Year-to-Date Ended
	September 29, 2017		September 23, 2016		September 29, 2017		September 23, 2016
	(in millions)
Selling, general and administrative expenses	$	71	$	53	$	205	$	164
Research and development expenses		15		16		47		40
Total	$	86	$	69	$	252	$	204