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4. INVENTORIES

ÌýÌýÌýÌýÌýÌýÌýÌýInventories are stated at the lower of cost or market, with cost determined using last-in first-out ("LIFO"), first-in first-out, and average costs methods for different components of inventory. Inventories consisted of the following (dollars in millions):

ÌýÌýÌýÌýÌýÌýÌýÌýFor SeptemberÌý30, 2012 and DecemberÌý31, 2011, approximately 10% and 12%, respectively, of inventories were recorded using the LIFO cost method.

ÌýÌýÌýÌýÌýÌýÌýÌýIn the normal course of operations we, at times, exchange raw materials and finished goods with other companies for the purpose of reducing transportation costs. The net nonmonetary open exchange positions are valued at cost. The amounts included in inventory under nonmonetary open exchange agreements receivable by us as of SeptemberÌý30, 2012 and DecemberÌý31, 2011 were $12Ìýmillion and $3Ìýmillion, respectively. Other open exchanges are settled in cash and result in a net deferred profit margin. The amount payable under these open exchange agreements as of SeptemberÌý30, 2012 and DecemberÌý31, 2011 was $2Ìýmillion and nil, respectively.

4. INVENTORIES

ÌýÌýÌýÌýÌýÌýÌýÌýInventories consisted of the following (dollars in millions):

ÌýÌýÌýÌýÌýÌýÌýÌýAs of both DecemberÌý31, 2011 and 2010, approximately 12% of inventories were recorded using the LIFO cost method.

ÌýÌýÌýÌýÌýÌýÌýÌýIn the normal course of operations we, at times, exchange raw materials and finished goods with other companies for the purpose of reducing transportation costs. The net non-monetary open exchange positions are valued at cost. The amounts included in inventory under non-monetary open exchange agreements receivable by us for both DecemberÌý31, 2011 and 2010 were $3Ìýmillion. Other open exchanges are settled in cash and result in a net deferred profit margin. The amounts under these open exchange agreements for both DecemberÌý31, 2011 and 2010 were nil.