Nucor 2011 Annual Report Download - page 50

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49
The following is a summary of the short-term investments held at December 31, 2011 and 2010:
(in thousands)
December 31, 2011 2010
Certificates of deposit $ 775,000 $ 800,363
Corporate debt 103,506 —
Federal Home Loan Bank obligations 185,500 —
Variable rate demand notes 298,635 353,260
$1,362,641 $1,153,623
Aggregate contractual maturities of Nucor’s short-term investments are $1,064.0 million in 2012 and $298.6 million in 2027
and thereafter.
5. ACCOUNTS RECEIVABLE
An allowance for doubtful accounts is maintained for estimated losses resulting from the inability of our customers to make required
payments. Accounts receivable are stated net of the allowance for doubtful accounts of $54.3 million at December 31, 2011 ($61.2
million at December 31, 2010 and $52.9 million at December 31, 2009).
6. INVENTORIES
Inventories consist of approximately 40% raw materials and supplies and 60% finished and semi-finished products at December
31, 2011 (41% and 59%, respectively, at December 31, 2010). Nucor’s manufacturing process consists of a continuous, vertically
integrated process from which products are sold to customers at various stages throughout the process. Since most steel products
can be classified as either finished or semi-finished products, these two categories of inventory are combined.
If the FIFO method of accounting had been used, inventories would have been $763.2 million higher at December 31, 2011 ($620.4
million higher at December 31, 2010). During 2010 and 2009, inventory quantities at locations that value inventory using LIFO
were reduced, resulting in a liquidation of LIFO inventory layers carried at lower costs that prevailed in prior years. The effect of the
liquidations was to decrease cost of products sold by $30.4 million in 2010 and $81.5 million in 2009 (there was no liquidation of
LIFO inventory layers in 2011). Use of the lower of cost or market method reduced inventories by $6.8 million at December 31, 2011
($2.9 million at December 31, 2010).
Nucor has entered into supply agreements for certain raw materials, utilities and other items in the ordinary course of business. These
agreements extend into 2028 and total approximately $7.80 billion at December 31, 2011.
7. PROPERTY, PLANT AND EQUIPMENT
(in thousands)
December 31, 2011 2010
Land and improvements $ 515,674 $ 431,765
Buildings and improvements 841,179 834,661
Machinery and equipment 7,727,630 7,502,203
Construction in process and equipment deposits 396,614 323,845
9,481,097 9,092,474
Less accumulated depreciation (5,725,493) (5,240,356)
$3,755,604 $3,852,118
The estimated useful lives range from 5 to 10 years for land improvements, 9 to 31.5 years for buildings and improvements, and 2 to
15 years for machinery and equipment.