17 – Inventories

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Million €

2013

2012

Raw materials and factory supplies

2,560

2,629

Work-in-process, finished goods and merchandise

6,923

6,865

Advance payments and services-in-process

109

87

Inventories

9,592

9,581

Work-in-process, finished goods and merchandise are combined into one item due to the production conditions in the chemical industry. Services-in-process primarily relate to services not invoiced as of the balance sheet date.

Inventories are valued using the weighted average cost method. Impairments are reversed if the reasons for the impairments no longer apply.

Cost of sales included inventories recognized as an expense amounting to €43,965 million in 2013, and €43,018 million in 2012.

Valuation allowances on inventories amounted to €16 million in 2013 and €18 million in 2012.

Of the total inventory, €1,890 million was valued at net realizable value in 2013 (2012: €2,175 million).