generally based on world-wide economic conditions in the offshore oil and gas industry, and is not based on a specific relationship between the two types of contracts. Substantially all of the Company’s sales are made on a purchase order basis. Purchase orders are subject to change and/or termination at the option of the customer. In case of a change or termination, the customer is required to pay the Company for work performed and other costs necessarily incurred as a result of the change or termination. Generally, the Company attempts to raise its prices as its costs increase. However, the actual pricing of the Company’s products and services is impacted by a number of factors, including global oil prices, competitive pricing pressure, the level of utilized capacity in the oil service sector, maintenance of market share, the introduction of new products and general market conditions. The Company accounts for larger and more complex projects that have relatively longer manufacturing time frames on a percentage-of-completion basis. During 2014, there were 17 projects that were accounted for using the percentage-of-completion method, which represented approximately 11%, of the Company’s total revenues and 13% of the Company’s product revenues. During 2013 and 2012, there were 21 projects that were accounted for using the percentage-of-completion method which represented 15% and 20%, respectively of the company’s total revenue and 18% and 24% of the Company’s product revenues, respectively. This percentage may fluctuate in the future. Revenues accounted for in this manner are generally recognized based upon a calculation of the percentage complete, which is used to determine the revenue earned and the appropriate portion of total estimated cost of sales. Accordingly, price and cost estimates are reviewed periodically as the work progresses, and adjustments proportionate to the percent complete are reflected in the period when such estimates are revised. Losses, if any, are recorded in full in the period they become known. Amounts received from customers in excess of revenues recognized are classified as a current liability. See “Item 1A. Risk Factors—We may be required to recognize a charge against current earnings because of percentage-of-completion accounting.” The following table sets forth, for the periods indicated, a breakdown of the Company’s U.S. Gulf of Mexico products and services revenues: Numerous subsea equipment orders were completed and shipped, contributing to the large increase in subsea equipment revenue for the year ended December 31, 2014 and 2013 as compared to the same period for 2012. The change in offshore rig equipment revenues for 2014 compared to the same period of 2013 resulted primarily from an increase of revenues from projects accounted for under the percentage-of-completion method for offshore rig equipment projects. For 2014, 2013 and 2012 the Company’s U.S. Gulf of Mexico service revenues as a percentage of worldwide revenue was 6.0% and 6.1% and 6.9%, respectively. Cost of Sales. The principal elements of cost of sales are labor, raw materials and manufacturing overhead. Cost of sales as a percentage of revenues is influenced by the product mix sold in any particular period, costs from projects accounted for under the percentage-of-completion method and market conditions. The Company’s costs related to its foreign operations do not significantly differ from its domestic costs. 32 Year Ended December 31, 2014 2013 2012 (In millions) Revenues: Products Subsea equipment .............................................. $233.8 $209.7 $118.5 Surface equipment ............................................. 6.5 3.8 Offshore rig equipment ......................................... 45.2 16.6 19.7 Total products ............................................. 285.5 230.1 138.6 Services ......................................................... 56.2 53.6 50.3 Total U.S. Gulf of Mexico revenues ........................... $341.7 $283.7 $188.9