Question

Q 10.2: john dies and leaves property to his sons bob, tom, ron, and joe. bob farms the land he inherits. tom builds a new factory for the company he owns on his land. ron subdivides and develops his property. joe's property abuts the store he owns, and he turns it into a parking lot. which son should classify his land as inventory rather than as a fixed asset?

Answer 1

Ron is the son who should classify his land as inventory instead of as a fixed asset because fixed assets typically lose value over time, or depreciate, and they do not get converted into cash. In this case, Ron's land would be classified as inventory.