4.	INVENTORY

Inventories are stated at the lower of cost or market, using the first-in first-out method. Cost includes materials, labor and manufacturing overhead related to the purchase and production of inventories. We regularly review inventory quantities on hand, future purchase commitments with our supplies, and the estimated utility of our inventory. If the review indicates a reduction in utility below carrying value, we reduce our inventory to a new cost basis through a charge to cost of goods sold. Allowance for slow moving items increased $6,366 due to a type of aerostat material which was custom ordered. Inventory consists of the following at March 31, 2018 and December 31, 2017:

	March 31, 2018			December 31, 2017
Raw Materials	$	83,018		$	114,119
Work in Progress		156,375			482,770
Finished Goods		417,233			398,912
In Transit		0			5,468
Less valuation allowance		(9,572	)		(9,572	)
Total	$	647,054		$	991,697