What do assets include?

Assets encompass any items of value that a company owns and can utilize to generate revenue. This typically includes both tangible and intangible items. The correct answer highlights that assets include items such as inventory, which represents goods available for sale, and equipment, which can be used in the production of goods or services. These elements are crucial to the operational capacity of a business, making them an integral part of financial reporting.

In contrast, the incorrect choices reflect misunderstandings of what constitutes assets. For instance, only tangible items would exclude valuable intangible assets like patents or trademarks. Contingent liabilities refer to potential obligations that may arise from specific events, which are not classified as assets. Lastly, stating that only current liabilities includes assets misrepresents the nature of assets entirely, as current liabilities are obligations a company needs to pay off within a year, rather than resources it owns.