Question: Which of the following statements best describes the accrual basis of accounting?

Options:

A$)$ Revenue and expenses are recorded when cash is received or paid out.

B$)$ Revenue and expenses are recorded when they are earned or incurred, regardless of when cash is received or paid out.

C$)$ Revenue and expenses are recorded only when cash transactions occur.

D$)$ Revenue and expenses are recorded at the end of the accounting period.