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Free Inventory tutorial, Inventory refers to all the items, goods, merchandise, and materials held by a business for selling in the market to earn a profit. Example: If a newspaper vendor uses a vehicle to deliver newspapers to the customers, only the newspaper will be considered inventory. The vehicle will be treated as an asset.What is inventory in accounting? Inventory is the array of finished goods or goods used in production held by a company. Inventory is classified as a current asset on a company's balance sheet, and it serves as a buffer between manufacturing and order fulfillment.What is the concept of inventory? Inventory is an accounting term that refers to goods that are in various stages of being made ready for sale, including: Finished goods (that are available to be sold) Work-in-progress (meaning in the process of being made) Raw materials (to be used to produce more finished goods)