Which of the following assets is NOT considered to be an ordinary asset?

• A. Office building used by the company
• B. Raw materials used in production
• C. Accounts receivable from customers
• D. Inventory held for sale by a retailer

Answer: (A)

Verified step by step guidance

1. Understand the definition of an ordinary asset: Ordinary assets are typically those that are part of a company's normal business operations, such as inventory, accounts receivable, and raw materials used in production.
2. Analyze each option provided in the question to determine whether it fits the definition of an ordinary asset.
3. Option 1: 'Office building used by the company' - This is a fixed asset or property, plant, and equipment (PPE), not an ordinary asset, as it is not part of the company's regular business operations or inventory.
4. Option 2: 'Raw materials used in production' - These are considered ordinary assets because they are directly used in the production process, which is part of normal business operations.
5. Option 3: 'Accounts receivable from customers' and Option 4: 'Inventory held for sale by a retailer' - Both are ordinary assets because they are directly related to the company's core business activities (selling goods or services).