Which assets are classified as current assets?

Current assets are typically defined as assets that are expected to be converted into cash or consumed within one year or within the operating cycle of the business, whichever is longer. This includes cash, accounts receivable, inventory, and other short-term investments.

In this case, the classification of current assets is best represented by cash and inventory expected to be converted to cash within one year, as these are fundamental components of a company's liquidity. Cash is the most liquid asset, and inventory that is expected to be sold or converted to cash within a year is also essential for day-to-day operations, thus fitting the definition of current assets perfectly.

Other options contain assets that do not meet the criteria for current assets. Real estate and equipment are considered long-term assets as they are not expected to be converted to cash in the near term. Long-term investments and patents also fall under the category of non-current assets due to their long-term nature. Additionally, accounts payable and long-term debts represent liabilities rather than assets, further distinguishing them from the current asset category.