Inventories

6 Months Ended

Jul. 31, 2023

Inventory is valued at the lower of cost or net realizable value (determined on a first-in, first-out basis) and includes material, labor, and factory overhead. The Company records valuation adjustments for the excess cost of the inventory over its estimated net realizable value. Valuation adjustments for slow-moving and obsolete inventory are calculated using an estimated percentage applied to inventories based on a physical inspection of the product in connection with a physical inventory, a review of slow-moving products and component stage, inventory category, historical and forecasted consumption of sales, and consideration of active marketing programs. The market for education furniture is traditionally driven by value, not style, and the Company has not typically incurred material obsolescence expenses. If market conditions are less favorable than those anticipated by management, additional valuation adjustments may be required. The Company records the cost of excess capacity as a period expense, not as a component of capitalized inventory valuation.

The following table presents a breakdown of the Company’s inventories as of July 31, 2023, January 31, 2023 and July 31, 2022:


	7/31/2023		1/31/2023		7/31/2022
	(In thousands)

Finished goods	$	24,995	$	25,740	$	26,336
Work in process	29,081		25,303		19,138
Raw materials	17,777		16,363		15,754
Total inventories	$	71,853	$	67,406	$	61,228