CRGN » Topics » 6. Inventory

This excerpt taken from the CRGN 10-K filed Mar 14, 2007.

Inventory

Inventory is recorded at the lower of cost or market. Cost includes material, labor and estimates related to manufacturing overhead costs. Cost is determined using the first-in-first-out method for non-lot controlled items and on the specific identification basis for lot controlled items. Lot controlled items relate to critical components in 454’s instrument and reagent manufacturing process. In order to state inventory at net realizable value, 454 records adjustments to inventory for potentially excess, obsolete or impaired goods based upon historical turnover and assumptions about future demand for its instrument and reagent manufacturing process and market

 

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conditions. Our estimates and assumptions for excess and obsolete inventory are subject to uncertainty. Future product introductions and related inventories may require additional reserves based upon changes in market demand or introduction of competing technologies. Increases in the reserve for excess and obsolete inventory would result in a corresponding increase to cost of revenues.

This excerpt taken from the CRGN 10-Q filed Nov 8, 2006.

6. Inventory

A summary of inventory is as follows:

 

    

September 30,

2006

   December 31,
2005

Raw material

   $ 5,395    $ 2,098

Work in process

     1,358      1,336

Finished goods

     2,165      669
             

Total

   $ 8,918    $ 4,103
             

454’s inventory consists of instrumentation, reagents and disposables. During the nine months ended September 30, 2006, 454 transferred $568 of laboratory equipment from inventory to property and equipment. This equipment is to be used in the Company’s research and development facility and fee for service facility. This equipment has been placed in service and is being depreciated on a straight line basis, consistent with the Company’s property and equipment policy. On February 1, 2005, the date on which 454 successfully completed the installation of its first sequencing instrument at a customer site, 454 began to capitalize, in inventory the costs of manufacturing instruments,

 

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reagents and consumables for commercial sale. Included in inventory on February 1, 2005 was raw material, which was previously capitalized as a fixed asset, valued at net book value on February 1, 2005 of $556.

This excerpt taken from the CRGN 10-Q filed Aug 9, 2006.

6. Inventory

A summary of inventory is as follows:

 

     June 30,
2006
  

December 31,

2005

Raw material

   $ 3,723    $ 2,098

Work in process

     1,252      1,336

Finished goods

     2,270      669
             

Total

   $ 7,245    $ 4,103
             

During the second quarter of 2006, 454 transferred $193 of laboratory equipment from inventory to property and equipment to be used in 454’s research and development facility and fee for service facility. This equipment has been placed in service and is being depreciated on a straight-line basis, consistent with the Company’s property and equipment policy.

This excerpt taken from the CRGN 10-K filed Mar 14, 2006.

Inventory

Inventory is recorded at the lower of cost or market. Cost includes material, labor and estimates related to manufacturing overhead costs. Cost is determined using the first-in-first-out method for non-lot controlled items and on the specific identification basis for lot controlled items. Lot controlled items relate to critical components in 454’s instrument and reagent manufacturing process. In order to state inventory at net realizable value, 454 records adjustments to inventory for potentially excess, obsolete or impaired goods based upon historical turnover and assumptions about future demand for its instrument and reagent manufacturing process and market conditions. To date, these adjustments have been immaterial. Our estimates and assumptions for excess and obsolete inventory are subject to uncertainty. The estimates we use for demand are also used for near-term capacity planning and inventory purchasing. Future product introductions and related inventories may require additional reserves based upon changes in market demand or introduction of competing technologies. Increases in the reserve for excess and obsolete inventory would result in a corresponding increase to cost of revenues.

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