This account tracks the current value of your inventory.
Most businesses use just one asset account for tracking inventory value. However, if it makes sense for you to track the value of different types of inventory in different asset accounts, you can create additional accounts of the type Other Current Asset and select them as you create new inventory items.
QuickBooks automatically adds the Inventory Asset account to your Chart of Accounts the first time you create an inventory item. Each time you create an inventory part item or inventory assembly item, QuickBooks preselects Inventory Asset as the asset account for the new item.
QuickBooks pulls information from the Inventory Asset account (and any other asset accounts you may create and assign to inventory items) to generate the Inventory Valuation Summary report and the Inventory Valuation Detail report.