B. INVENTORIES:

The amount of inventories valued on the LIFO basis was $29,463,000 and $30,159,000 as of December 31, 2012 and 2011, respectively, and consists of housewares/small appliance finished goods. Under LIFO, inventories are valued at approximately $6,375,000 and $5,518,000 below current cost determined on a first-in, first-out (FIFO) basis at December 31, 2012 and 2011, respectively. During the years ended December 31, 2012, 2011, and 2010, $858,000, $5,474,000, and $601,000, respectively, of a LIFO layer was liquidated. The Company uses the LIFO method of inventory accounting to improve the matching of costs and revenues for the Housewares/Small Appliance segment.

The following table describes that which would have occurred if LIFO inventories had been valued at current cost determined on a FIFO basis:



Increase (Decrease) – (In thousands, except per share data)
Year	Cost of Sales		Net Earnings		Earnings Per Share
2012	$	(857)	$	546	$	0.08
2011	$	(1,313)	$	832	$	0.12
2010	$	(1,850)	$	1,169	$	0.17

This information is provided for comparison with companies using the FIFO basis.

Inventory for Defense, Absorbent Products, and raw materials of the Housewares/Small Appliance segments are valued under the FIFO method and total $53,901,000 and $64,347,000 at December 31, 2012 and 2011, respectively. The December 31, 2012 FIFO total is comprised of $4,388,000 of finished goods, $40,340,000 of work in process, and $9,173,000 of raw material and supplies. At December 31, 2011 the FIFO total was comprised of $2,600,000 of finished goods, $50,462,000 of work in process, and $11,285,000 of raw material and supplies.