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What is Loose tools?and why it is not included in inventory?

Ankita, Ritik and Harmeet!!

​Loose Tools are current assets and therefore a part of Current Assets. However, for the purpose of calculating Current Ratio, loose tools are excluded.

The reason for which has already been explained in the link provided below:

https://www.meritnation.com/ask-answer/question/it-is-given-in-the-tsgrewal-part-ii-book-that-loose-tools-ar/accounting-ratios/8807193

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HII BECAUSE IT IS A FIXED ASSET IT IS A NON CURRENT ASSSET NOT CURRENT ASSET SO THTS WHY IT IS NOT INCLUDED IN INVENTORIES
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Loose tools are the parts of machinery or you can say Spare parts of machinery.
It depends on the nature of Loose tools whether it is current assets or fixed assets. If the loose tools are of regular use and replaced or used within one year, then it shall be considered as current assets. Otherwise shall be treated as Fixed Assets.
 
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