Summary: A new wave splitting is suggested that simplifies the analysis of wave propagation in reciprocal bi-isotropic media. Two different methods to solve the scattering problem are analyzed: the invariant imbedding and the Green function approach. The medium is modeled by constitutive relations in the time domain (time convolution) and the slab is assumed to be inhomogeneous with respect to the depth. It is shown that the cross-polarized contribution to the reflected field at normal incidence is zero for the general reciprocal inhomogeneous slab. Moreover, the rotation and the attenuation of the wave front are calculated explicitly in the general inhomogeneous slab case. Special attention is paid to normal incidence and to the homogeneous semi-infinite medium.