Which of the following best describes the modified accrual approach used to record interest income earned by individual taxpayers from an investment contract?

A. Interest income is recorded when received unless it was reported in a previous period.

B. Interest income, regardless of whether the interest is received or receivable, is reported on each anniversary date of the investment contract unless it was reported in a previous period.

C. Interest income, regardless of whether the interest is received or receivable, is recorded on the last day of the fiscal period of the investment contract unless it was reported in a previous period.

D. Interest income, regardless of whether the interest is received or receivable, is recorded based on the calendar year unless it was reported in a previous period.