C.	Inventories

Inventories are valued at the lower of cost or net realizable value using the FIFO (first-in, first-out) method. The Company reduces the value of its inventories to net realizable value when the net realizable value is believed to be less than the cost of the item. The inventory reserve for obsolescence as of March 31, 2018 and December 31, 2017 was $1,263,000 and $1,213,000, respectively.

Inventories are comprised of the following (in thousands):

	March 31, 2018		December 31, 2017
Raw materials	$	1,668	$	1,526
Work in process		1,585		1,337
Finished goods		755		1,012
Total Inventories, net	$	4,008	$	3,875