 Hello in this lecture we're going to define merchandise according to fundamental accounting principles while 22nd edition that the definition of merchandise is also called merchandise inventory or inventory good that a company owns and expects to sell to customers so when we're talking about merchandise that's another shorthand way of saying inventory or merchandise inventory inventory being a type of asset the difference between inventory and other types of assets being that inventory is geared towards purchasing and selling the inventory all assets having that end goal of helping us to generate revenue in the future inventory being distinct in that it will achieve that goal by the purchase and the sale of the inventory or the manufacturing and the selling of that inventory so if we had something like a boat it could be an asset if we're using that boat in order to help us ship things or something like that to help us generate revenue or it could be inventory merchandise if we're using it to purchase and sell and of course if we have a computer same thing if we have it just for the business in terms of use in order to help us generate revenue in the future it's a business asset as opposed to if we're buying and selling computers it now being merchandise inventory merchandise inventory create a forklift that we used for the business asset fixed assets as opposed to if we had a forklift that we're using to purchase and sell or manufacture and sell now we're talking about inventory merchandise inventory merchandise