Is Inventory a Current Or Non-Current Asset?

Written by True Tamplin, BSc, CEPF®

Updated on January 02, 2023

Inventory is almost always considered a current asset. A current asset is any asset that will provide an economic benefit for or within one year. A non-current asset is an asset that will provide an economic benefit after or for longer than one year. Inventory production is typically closely correlated with demand, so it will almost always be sold within a year or being produced, making it a current asset. In the event that an inventory item is expected to sell after a year, it will be a non-current asset.

Is Inventory a Non-Current or Current Asset FAQs

Is inventory a non-current or current asset?

Inventory is almost always considered a current asset.

What is a current asset?

A current asset is any asset that will provide an economic benefit for or within one year.

What is a non-current asset?

A non-current asset is an asset that will provide an economic benefit after or for longer than one year.

Why is inventory usually a current asset?

Inventory production is typically closely correlated with demand, so it will almost always be sold within a year or being produced, making it a current asset.

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website, view his author profile on Amazon, or check out his speaker profile on the CFA Institute website.