What happens when an object sinks?

An object that has a "net density" greater than the liquid it is placed in will normally sink to the bottom of the container. In some cases, usually for small objects, the surface tensionof the liquid will keep it afloat, but that can change (e.g. adding soap to water reduces surface tension).

When sunken, the object is DISPLACING its net volume of liquid. When an object floats, it is only displacing its net weight of liquid.

For example, an open steel canoe floats on a lake because its interior contains air, making its net density lower than water. The canoe will sink down partly into the water, and displace a mass of water equal to the mass of the canoe and its occupants. If it is overloaded, and water enters the canoe, it will sink to the bottom of the lake, its net density now being greater than water. The occupants will swim away, and the canoe is now only displacing its net volume (i.e. of the sides and bottom of the boat, and any small closed spaces that water cannot enter).