Inventories

Inventories are stated at the lower of cost and net realizable value using the first-in first-out costing method. Inventories as of December 31, 2019 and 2018 include the costs of material, labor, and factory overhead. Components of inventories consist of the following:



	December 31,
	2019		2018
Raw materials	$	12,755	$	13,698
Work in process	3,117		2,489
Finished goods	7,593		6,755
	$	23,465	$	22,942

During 2019, the Company recorded an inventory reserve of $2.3 million relating to its TracPhone V-IP products as the Company decided to no longer promote sales of these products and instead to focus its efforts on migrating customers to its HTS network and products.