5. INVENTORIES

Inventoried costs contain amounts relating to long-term contracts and programs with long production cycles, a portion of which will not be realized within one year. Long-term contract inventory includes an immaterial amount of claims or other similar items subject to uncertainty concerning their determination or realization. Inventories are valued at the lower of cost or market. The composition of inventories is as follows:



(In thousands)	March 31, 2018			December 31, 2017
Raw materials	$	206,004		$	191,855
Work-in-process	75,204			73,937
Finished goods and component parts	117,241			114,307
Inventoried costs related to U.S. Government and other long-term contracts	53,477			65,150
Gross inventories	451,926			445,249
Less: Inventory reserves	(55,238		)	(54,638		)
Progress payments applied, principally related to long-term contracts	(9,901		)	(11,745		)
Inventories, net	$	386,787		$	378,866

Inventoried costs related to long-term contracts include capitalized contract development costs related to certain aerospace and defense programs of $43.1 million and $35.0 million as of March 31, 2018 and December 31, 2017, respectively. These capitalized costs will be liquidated as control of production units is transferred to the customer. As of March 31, 2018 and December 31, 2017, $8.6 million and $5.4 million, respectively, are scheduled to be liquidated under existing firm orders.