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85
NOTE 6 – INVENTORIES
The following table provides a breakdown of inventories:
Inventories at December 31
In millions 2012 2011
Finished goods $ 4,880 $ 4,327
Work in process 1,910 1,716
Raw materials 866 765
Supplies 820 769
Total inventories $ 8,476 $ 7,577
The reserves reducing inventories from a FIFO basis to a LIFO basis amounted to $842 million at December 31, 2012 and
$1,105 million at December 31, 2011. Inventories valued on a LIFO basis, principally hydrocarbon and U.S. chemicals and
plastics product inventories, represented 29 percent of the total inventories at December 31, 2012 and 30 percent of total
inventories at December 31, 2011.
A reduction of certain inventories resulted in the liquidation of some of the Company’s LIFO inventory layers, increasing
pretax income $91 million in 2012, $126 million in 2011 and $159 million in 2010.
NOTE 7 – PROPERTY
Property at December 31
In millions
Estimated Useful
Lives (Years) 2012 2011
Land — $ 916 $ 862
Land and waterway improvements 15-25 1,377 1,310
Buildings 5-55 4,886 4,513
Machinery and equipment 3-20 39,828 37,580
Utility and supply lines 5-20 2,350 2,264
Other property 3-50 2,267 2,290
Construction in progress — 2,742 3,397
Total property $ 54,366 $ 52,216
In millions 2012 2011 2010
Depreciation expense $ 2,057 $ 2,177 $ 2,289
Manufacturing maintenance and repair costs $ 2,188 $ 2,247 $ 1,949
Capitalized interest $ 84 $ 90 $ 72
NOTE 8 – NONCONSOLIDATED AFFILIATES AND RELATED COMPANY TRANSACTIONS
The Company’s investments in companies accounted for using the equity method (“nonconsolidated affiliates”) were
$4,121 million at December 31, 2012 and $3,405 million at December 31, 2011. At December 31, 2012, the carrying amount of
the Company’s investments in nonconsolidated affiliates was $69 million more than its share of the investees’ net assets,
exclusive of additional differences for Dow Corning Corporation (“Dow Corning”) and MEGlobal, which are discussed
separately below. At December 31, 2011, the carrying amount of the Company’s investments in nonconsolidated affiliates was
$80 million more than its share of the investees’ net assets, exclusive of additional differences for Dow Corning and MEGlobal.
Dividends received from the Company’s nonconsolidated affiliates were $823 million in 2012, $1,016 million in 2011 and
$668 million in 2010.
At December 31, 2012 and December 31, 2011, the Company’s investment in Dow Corning was $227 million less than the
Company’s proportionate share of Dow Corning’s underlying net assets. This amount is considered a permanent difference
related to the other-than-temporary decline in the Company's investment in Dow Corning, triggered by Dow Corning's May 15,
1995 bankruptcy filing. Dow Corning emerged from bankruptcy in 2004.