Which term best describes the items held by a company for sale or use in production?

The term that best describes the items held by a company for sale or use in production is "Inventory." Inventory encompasses all goods and materials that a business holds for the purpose of resale or incorporation into products. This includes finished products ready for sale, work-in-progress items, and raw materials that are necessary for production processes.

Understanding inventory is crucial for effective inventory management, which affects both the cost of goods sold and a company's overall profitability. Proper inventory levels ensure that a business can meet customer demand without overstocking, which can lead to increased storage costs and potential losses from unsold goods.

Other terms provided in the choices have distinctive meanings. A supply chain refers to the entire system involved in producing and delivering a product, including sourcing, manufacturing, and distribution, rather than just the items themselves. Capital assets are long-term assets that a company uses in the production of goods and services, which are not typically intended for sale. A product line refers to a group of related products marketed by the same company, which does not specifically denote the individual items held for sale. Therefore, "Inventory" is the most accurate and encompassing term for the context of items held for sale or production use.