Inventories

Inventories are stated at the lower of cost or market. In the United States, we manufacture certain finished products and parts inventories for drill bits, completion products, bulk materials and other tools that are recorded using the last-in, first-out method and totaled $133 million at December 31, 2016 and $138 million at December 31, 2015. If the average cost method had been used, total inventories would have been $16 million higher than reported at December 31, 2016 and $18 million higher than reported at December 31, 2015. The cost of the remaining inventory was recorded on the average cost method. Inventories consisted of the following:



	December 31
Millions of dollars	2016		2015
Finished products and parts	$	1,388	$	1,992
Raw materials and supplies	778		879
Work in process	109		122
Total	$	2,275	$	2,993

All amounts in the table above are reported net of obsolescence reserves of $263 million at December 31, 2016 and $251 million at December 31, 2015.