(4) Inventories

Inventories are valued at the lower of cost (using either the first-in, first-out (“FIFO”) or average cost methods) or market. The Company evaluates and adjusts as necessary its excess and obsolescence reserve on a quarterly basis. Excess inventories are quantities of items that exceed anticipated sales or usage for a reasonable period. The Company has guidelines for calculating provisions for excess inventories based on the number of months of inventories on hand compared to anticipated sales or usage. Management uses its judgment to forecast sales or usage and to determine what constitutes a reasonable period. Inventory cost includes material, labor and overhead. Inventories consisted of the following:


		September 30,		December 31,
		2016		2015
Raw materials	$	36,707	$	36,021
Work-in-progress		8,568		7,162
Finished goods		19,925		17,826
Total inventories, net	$	65,200	$	61,009

Inventory valued using the FIFO method was $41,452 and $35,378 at September 30, 2016 and December 31, 2015, respectively. Inventory valued using the average cost method was $23,748 and $25,631 at September 30, 2016 and December 31, 2015, respectively.