An asset
An income
A liability
None of the above
Answer is Right!
Answer is Wrong!
Income received in advance is a liability. This is because it is a debt that the company owes to the customer. The company has received money from the customer, but it has not yet provided the goods or services that the customer has paid for. The company will have to provide the goods or services in the future, and until it does, it owes the customer money.
An asset is something that a company owns and that has value. Income is money that a company earns. A liability is a debt that a company owes.
Here is a more detailed explanation of each option:
- An asset is something that a company owns and that has value. Assets can be tangible, such as cash, equipment, or inventory, or they can be intangible, such as patents, trademarks, or goodwill.
- Income is money that a company earns. Income can come from a variety of sources, such as sales of goods or services, interest, dividends, or rent.
- A liability is a debt that a company owes. Liabilities can be current liabilities, such as accounts payable and accrued expenses, or long-term liabilities, such as bonds and mortgages.
- None of the above is not a correct answer.