Note 4: Inventories and Contracts in Progress

3 Months Ended

Mar. 31, 2013

Notes to Condensed Consolidated Financial Statements [Abstract]

Note 4: Inventories and Contracts in Progress

Inventories and Contracts in Progress



(Dollars in millions)	March 31, 2013			December 31, 2012
Raw materials	$	1,868		$	1,861
Work-in-process	4,500			4,151
Finished goods	3,438			3,205
Contracts in progress	7,468			7,354
	17,274			16,571
Less:
Progress payments, secured by lien, on U.S. Government contracts	(279		)	(274		)
Billings on contracts in progress	(6,834		)	(6,760		)
	$	10,161		$	9,537

As of March 31, 2013 and December 31, 2012, inventory includes capitalized contract development costs of $809 million and $823 million, respectively, related to certain aerospace programs. These capitalized costs are liquidated as production units are delivered to the customer. The capitalized contract development costs within inventory principally relate to costs capitalized on Sikorsky’s CH-148 contract with the Canadian Government. The CH-148 is a derivative of the H-92, a military variant of the S-92.

- Definition

The entire disclosure for inventory. This may include, but is not limited to, the basis of stating inventory, the method of determining inventory cost, the major classes of inventory, and the nature of the cost elements included in inventory. If inventory is stated above cost, accrued net losses on firm purchase commitments for inventory and losses resulting from valuing inventory at the lower-of-cost-or-market may also be included. For LIFO inventory, may disclose the amount and basis for determining the excess of replacement or current cost over stated LIFO value and the effects of a LIFO quantities liquidation that impacts net income.

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