NOTE 6. INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out) or net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. We write down the carrying value of inventory for estimated obsolescence by an amount equal to the difference between the cost of inventory and the estimated market value when warranted based on assumptions of future demand, market conditions, remaining shelf life, or product functionality. If actual market conditions or results of estimated functionality are less favorable than those we estimated, additional inventory write-downs may be required, which would have a negative effect on results of operations.

Unpaid inventory reflected within accounts payable in our consolidated balance sheets was $32.7 million at December 31, 2016, $30.1 million at December 31, 2015, and $21.4 million at December 31, 2014.

The components of inventories are as follows (in thousands):



	December 31,		December 31,
		2016		2015

Raw materials	$	27,561	$	31,184
Work-in-process		14,998		18,698
Finished goods		115,475		138,951
Total inventories	$	158,034	$	188,833