Estimates  — Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in  the United States (GAAP), which requires the use of estimates, judgments and assumptions that af fect the amounts reported in  the consolidated financial statements and accompanying disclosures.  We believe our assumptions and estimates are reasonable  and appropriate. However, due to the inherent uncertainties in making estimates, actual results could dif fer from those  estimates. Fair value measurements  — A three-tier fair value hierarchy is used to prioritize the inputs to valuation techniques used to  measure fair value. The three levels of inputs are as follows: Level 1 inputs (highest priority) include unadjusted quoted prices  in active markets for identical instruments. Level 2 inputs include quoted prices for similar instruments that are observable  either directly or indirectly. Level 3 inputs (lowest priority) include unobservable inputs in which there is little or no market  data, which require management to develop its own assumptions. Classification within the hierarchy is determined based on the  lowest level input that is significant to the fair value measurement. The inputs we use in our valuation techniques include market data or assumptions that we believe market participants  would use in pricing an asset or liability, including assumptions about risk when appropriate. Our valuation techniques include  a combination of observable and unobservable inputs.  When available, we use quoted market prices to determine the fair value  (market approach). In the absence of active markets for the identical assets or liabilities, such measurements involve developing  assumptions based on market observable data and, in the absence of such data, we consider the amount and timing of estimated  future cash flows and assumed discount rates reflecting varying degrees of credit risk that is consistent with what market  participants would use in a hypothetical transaction that occurs at the measurement date (income approach). Fair values may  not represent actual values of the financial instruments that could be realized as of the balance sheet date or that will be realized  in the future. Cash and cash equivalents  — Cash and cash equivalents includes cash on hand, demand deposits and short-term cash  investments that are highly liquid in nature and have maturities of three months or less when purchased. Marketable securities  — Our investments in marketable securities reported in the accompanying balance sheet are classified as  available for sale and carried at fair value. Unrealized gains and losses are recorded in accumulated other comprehensive  income (loss) (AOCI) until realized. Realized gains and losses are recorded using the specific identification method. Inventories  — Inventories are valued at the lower of cost or market. Cost is determined using the average or first-in, first-out  (FIFO) cost method. Property, plant and equipment  — As a result of our adoption of fresh start accounting on February 1, 2008, property , plant and  equipment was stated at fair value with useful lives ranging from  two to thirty years. Useful lives of newly acquired assets are  generally twenty to thirty years for buildings and building improvements,  five to ten years for machinery and equipment,  three  to five years for tooling and of fice equipment and three to ten years for furniture and fixtures. Depreciation is recognized over  the estimated useful lives using primarily the straight-line method for financial reporting purposes and accelerated depreciation  methods for federal income tax purposes. If assets are impaired, their value is reduced via an increase in accumulated  depreciation. Pre-production costs related to long-term supply arrangements  — The costs of tooling used to make products sold under long- term supply arrangements are capitalized as part of property , plant and equipment and amortized over their useful lives if we  own the tooling or if we fund the purchase but our customer owns the tooling and grants us the irrevocable right to use the  tooling over the contract period. If we have a contractual right to bill our customers, costs incurred in connection with the  design and development of tooling are carried as a component of other accounts receivable until invoiced. Design and  development costs related to customer products are deferred if we have an agreement to collect such costs from the customer;  otherwise, they are expensed when incurred.  At December 31, 2014, the machinery and equipment component of property ,  plant and equipment includes $2 of our tooling related to long-term supply arrangements, while trade and other accounts  receivable includes $29 of costs related to tooling that we have a contractual right to collect from our customers. Goodwill  — We test goodwill for impairment annually as of October 31 and more frequently if events occur or circumstances  change that would warrant an interim review . Goodwill impairment testing is performed at the reporting unit level, which is our  operating segment. We estimate the fair value of the reporting unit in the first step using various valuation methodologies,  including projected future cash flows and multiples of current earnings. If the estimated fair value of the reporting unit exceeds  its carrying value, the goodwill is considered not impaired. If the carrying value of the reporting unit exceeds its estimated fair  value, then the second step of the test would be required to determine the implied fair value of the goodwill and any resulting  impairment. Our goodwill is assigned to our Of f-Highway segment. The estimated fair value of our Of f-Highway reporting unit  46