What is the name for income that is received in advance by the business?

Unearned income

The correct answer is option 1- Unearned income.

Sometimes, a certain income is received but the whole amount of it does not belong to the current period. The portion of the income which belongs to the next accounting period is termed as income received in advance or an Unearned Income. Income received in advance is adjusted by recording the following entry: Concerned income A/c Dr. To Income received in advance A/c.