Inventory is an asset because it represents the items you purchase with the intention of selling them to generate profit. At any given time, inventory contains tangible goods that have already been acquired but not yet sold. You can think of inventory as the previously purchased items you have in stock, ready to be sold. It’s like a safety net that ensures you have customers’ orders available, so your business doesn’t miss out on potential sales and profits. In essence, inventory is what makes your business go. Without it, you wouldn’t have anything to sell or offer your clients.