Is inventory a current asset?

[lara]

Quick accounting check—is inventory a current asset or a long-term one? My logic is that we plan to sell it fast, but what if it sits in the warehouse for over a year? Does the classification change?

 

[Oscar]

Yes, inventory is a current asset. It represents goods a business plans to sell and is expected to be converted into cash within one operating cycle, usually within one year.

 

[Peter]

Yes, inventory is a current asset. It is classified as a current asset because businesses expect to sell or use it within one year or within the normal operating cycle.

 

[alexmetro]

Yep, the usual inventory is a current asset in that it is supposed to be sold in the normal operating cycle. Although there might be some items which may take more than a year, it is still considered current provided they are being sold as a business.