In accounting, "Shares" are classified under which category?

In accounting, shares represent ownership in a company and are classified under the category of investments. When individuals or entities purchase shares, they are essentially investing in the company with the expectation of earning a return, either through price appreciation or dividends. This classification reflects the nature of shares as long-term investments that can generate income or increase in value over time.

Shares are not classified as assets in the traditional sense like cash or inventory, as they denote ownership stake rather than immediate economic resources. Additionally, they do not fall under liabilities, which represent obligations the company must settle in the future. Finally, revenue pertains to the income generated from the company's primary business activities, not to the ownership stakes represented by shares. Thus, categorizing shares as investments accurately captures their role in financial reporting and investment strategy.