Inventories

12 Months Ended

Nov. 30, 2011

Inventories [Abstract]

Inventories

Note 5.    Inventories

Inventories consisted of the following (in thousands):

	November 30,
	2011		2010
Homes under construction	$	417,304	$	363,719
Land under development		587,582		701,636
Land held for future development		726,743		631,367
Total	$	1,731,629	$	1,696,721

Homes under construction is comprised of costs associated with homes in various stages of construction and includes direct construction and related land and land development costs. Land under development primarily consists of land, land development costs, capitalized interest and real estate taxes associated with land undergoing improvement activity. Land held for future development principally reflects land and land development costs related to land where development activity has been suspended but is expected to resume in the future. The Company may suspend development activity due to building permit moratorium or regulatory restrictions, or on large land parcels that it plans to build out over several years and/or parcels that have not yet been entitled. The Company may also defer development activity if it believes such a deferral will result in greater returns and/or maximize the economic performance of a community.

Interest is capitalized to inventories while the related communities are being actively developed and until homes are completed. Capitalized interest is amortized in construction and land costs as the related inventories are delivered to homebuyers. For those communities for which development activity has been suspended, applicable interest is expensed as incurred. The Company’s interest costs are as follows (in thousands):

	Years Ended November 30,
	2011			2010			2009
Capitalized interest at beginning of year	$	249,966		$	291,279		$	361,619
Capitalized interest related to consolidation of previously unconsolidated joint ventures		—			9,914			—
Interest incurred (a)		112,037			122,230			119,602
Interest expensed (a)		(49,204	)		(68,307	)		(51,763	)
Interest amortized to construction and land costs		(79,338	)		(105,150	)		(138,179	)
Capitalized interest at end of year (b)	$	233,461		$	249,966		$	291,279

(a) Amounts for the year ended November 30, 2011 include a $3.6 million gain on the early extinguishment of secured debt. Amounts for the year ended November 30, 2010 include a total of $1.8 million of debt issuance costs written off in connection with the Company’s voluntary reduction of the aggregate commitment under the Credit Facility from $650.0 million to $200.0 million and the voluntary termination of the Credit Facility effective March 31, 2010. Amounts for the year ended November 30, 2009 include losses on the early redemption of debt of $1.0 million.

(b) Inventory impairment charges are recognized against all inventory costs of a community, such as land, land improvements, cost of home construction and capitalized interest. Capitalized interest amounts presented in the table reflect the gross amount of capitalized interest as impairment charges recognized are not generally allocated to specific components of inventory.