Inventory is classified as a ________.

fixed asset

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current asset

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fictitious asset

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none of the above

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Solution

The correct option is A current asset
Current assets are those which arise during the course of business. These assets are fluctuating with each of the business transaction. Examples are sundry debtors, inventory, bills receivables, cash at bank, cash on hand etc.

Inventory is as an item of current asset.

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