Concept:Income received in advance is money received before the goods or services are supplied, so it creates an obligation for the business.Explanation:The business has not yet earned this income, so it still owes the customer the corresponding service or goods.This obligation is normally settled within the next accounting year.Therefore, it is classified as a current liability on the balance sheet.It is not an asset, because no future economic benefit is held by the business from this amount.Answer:Current liability