4. Supplemental Balance Sheet Information

Inventories

Inventories are stated at the lower of cost or market value on a first-in, first-out basis and are comprised of the following (in thousands):

	September 30,		December 31,
	2015		2014
Raw materials	$	545	$	71
Work-in-process	451		44
Finished goods	61		—

Total inventories	$	1,057	$	115

Property and Equipment

Property and equipment consists of the following (in thousands):

	September 30, 2015			December 31, 2014
Office and computer equipment	$	395		$	383
Software	623			480
Laboratory equipment	3,842			3,312
Furniture	187			187
Manufacturing tooling and molds	71			26
Leasehold improvements	3,158			764
T2Dx and components	4,026			563
Construction in progress	1,467			387

	13,769			6,102
Less accumulated depreciation and amortization	(4,321		)	(3,342		)

Property and equipment, net	$	9,448		$	2,760

Construction in progress is primarily comprised of equipment and leasehold improvement construction projects that have not been placed in service. T2Dx and components is comprised of raw materials and work-in-process inventory that are expected to be used or used to produce Company-owned instruments, based on the Company’s business model and forecast, and completed instruments that will be used for internal research and development or reagent rental agreements with customers. Completed T2Dx are placed in service once installation procedures are completed and are depreciated over five years. Depreciation expense for Company-owned T2Dx placed at customer sites pursuant to reagent rental agreements is recorded as a component of cost of product revenue and totaled approximately $28,000 for the three and nine months ended September 30, 2015. Depreciation expense for T2Dx used for internal research and development is recorded as a component of research and development expense.

Accrued Expenses

Accrued expenses consist of the following (in thousands):

	September 30,		December 31,
	2015		2014
Accrued payroll and compensation	$	2,524	$	1,846
Accrued research and development expenses	365		733
Accrued professional services	403		374
Other accrued expenses	999		709

Total accrued expenses	$	4,291	$	3,662