Choice "B" is correct. Inventories are considered non-spendable. Non-spendable fund balances represent resources in a form that cannot be spent (e.g., inventories or prepaid expenditures) or are legally or contractually required to remain whole (e.g., permanent fund principal).Choice "a" is incorrect. Inventories are considered non-spendable, not restricted. Restricted fund balances represent resources whose use has been limited by external sources such as creditors (e.g., debt covenants), contributors, other governments, laws, constitutional provisions or enabling legislation.Choice "c" is incorrect. Inventories are considered non-spendable, not assigned. Assigned fund balances are constrained by the government's intent to be used for specific purposes but are neither restricted nor committed.Choice "d" is incorrect. Inventories are considered non-spendable, not unassigned. Unassigned fund balance is the residual classification for the general fund. This classification represents fund balance that has not been assigned to other funds and that has not been restricted, committed or assigned to specific purposes within the general fund.