Investments in and Advances to Affiliates

12 Months Ended

Dec. 31, 2019

Related Party Transactions [Abstract]

Transactions with Affiliates

INVESTMENTS IN AND ADVANCES TO AFFILIATES

At December 31, 2019 and 2018, we had an investment in a joint venture with Resolute Forest Products, Inc. to operate jointly owned I-Joist facilities in Quebec (Resolute-LP). Each partner owns 50% of the venture. We both sell products and raw materials to Resolute-LP, and purchase products for resale from Resolute-LP. We eliminate profits on these sales and purchases, to the extent the inventory has not been sold through to third parties, based on its 50% interest. For the years ended December 31, 2019, 2018 and 2017, we sold $12 million, $17 million and $16 million of products to Resolute-LP and purchased $70 million, $58 million and $60 million of I-Joists from Resolute-LP.

Included in our Consolidated Balance Sheets at December 31, 2019 and 2018, are $4 million in accounts receivable associated with Resolute-LP. For the years ended December 31, 2019 and 2018, we received $11 million and $3 million, respectively, in dividends from Resolute-LP. We classified the receipt of these cash dividends as cash flows from operations. Our cumulative equity in earnings from Resolute-LP exceeds the cumulative distributions received; therefore, the dividends were deemed to be a return on our investment and not a return of our investment.

We are the exclusive distributor of the I-Joists produced and sold by the joint venture, and it is considered an integral part of our operations. We are classifying the income from the joint venture as a reduction in cost of sales. LP recorded income from affiliates of $11 million in 2019, $2 million in 2018, and $4 million in 2017.