INVENTORIES

Inventories are stated at lower of cost and net realizable value (using the first-in, first-out method). Inventories consisted of the following:



	Aug 31, 2018		May 31, 2018
(in thousands)
Raw materials	$	21,556	$	18,678
Work in process	9,829		10,808
Finished goods	18,336		19,430
Inventories	$	49,721	$	48,916

The Company periodically reviews for both obsolescence and loss of value. The Company makes assumptions about the future demand for and market value of the inventory. Based on these assumptions, the Company estimates the amount of obsolete, expiring and slow moving inventory. The total inventory reserve at both August 31, 2018 and May 31, 2018 was $6.1 million. Of the $6.1 million reserve as of August 31, 2018 and May 31, 2018, $1.6 million relates to the inventory reserve for Acculis inventory as a result of the recall announced in the fourth quarter of fiscal year 2017 and $0.7 million relates to a specific reserve related to the termination of an agreement with a Japanese distributor in the second quarter of fiscal year 2018.