Inventory refers to the goods and materials that a business holds for the purpose of resale or use in production. It is considered an asset on a company's balance sheet and is typically one of the largest components of current assets for retailers and manufacturers. In accounting terms, inventory represents the cost of unsold goods or raw materials that are still in the production process. It is important for businesses to manage their inventory effectively in order to meet customer demands, minimize storage costs, and optimize profitability.
