Which item from Alliah's data is an asset?

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Prepare for the WGU ACCT2350 Intro to Business Accounting Exam. Practice with multiple choice questions and detailed solutions to sharpen your accounting skills. Master your exam with confidence!

Multiple Choice

Which item from Alliah's data is an asset?

Explanation:
An asset is a resource owned by the business that is expected to bring future economic benefits. Inventory fits this because it consists of goods the company holds for sale. It will typically be converted into cash or revenue when sold, so it is classified as a current asset on the balance sheet. Loans payable are obligations to repay debt, making them liabilities. Capital stock represents the owners’ claim on the business, i.e., equity. Revenue is income from operations and affects the income statement and equity but is not an asset. Therefore, inventory is the asset.

An asset is a resource owned by the business that is expected to bring future economic benefits. Inventory fits this because it consists of goods the company holds for sale. It will typically be converted into cash or revenue when sold, so it is classified as a current asset on the balance sheet. Loans payable are obligations to repay debt, making them liabilities. Capital stock represents the owners’ claim on the business, i.e., equity. Revenue is income from operations and affects the income statement and equity but is not an asset. Therefore, inventory is the asset.

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