BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Assets held for sale in the ordinary course of business
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Assets held for sale in the secondary course of business
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Assets held for sale in the tertiary course of business
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Assets held in the store for safekeeping
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Detailed explanation-1: -Inventories are defined as: (a) assets held for sale in the ordinary course of business, in the process of production for such sale, or in the form of materials or supplies to be consumed in the production process or in the rendering of services.
Detailed explanation-2: -Inventories are those assets of an entity which are sold in the normal course of business. These are the finished goods which are ready for being sold. Assets which are held for sale but are not traded in the normal course of business cannot be classified as inventories.
Detailed explanation-3: -Inventory is a very important asset for any company. It is defined as the array of goods used in production or finished goods held by a company during its normal course of business.
Detailed explanation-4: -Inventories consist of raw material, work in process, stores, spares, and finished goods which are held by a business, either for sale or for the purpose of using them in the process of producing goods and services.
Detailed explanation-5: -Inventory refers to all the items, goods, merchandise, and materials held by a business for selling in the market to earn a profit.