Which of the following best describes the primary goal of accrual accounting?

The primary goal of accrual accounting is to measure revenues and expenses when they are incurred, regardless of when cash transactions occur. This approach provides a more accurate representation of a company's financial performance and position during a specific period. By recognizing revenues when they are earned and expenses when they are incurred, accrual accounting aligns financial reporting with the actual economic events of the business. This is essential for users of financial statements, such as investors and creditors, as it allows them to assess the company's ongoing profitability and operational efficiency.

Focusing exclusively on cash transactions, as suggested in the first option, fails to capture the full economic realities of the business, particularly in scenarios where sales and expenses occur before cash changes hands. Simplifying bookkeeping, mentioned in the third option, is not an objective of accrual accounting; rather, it presents a more complex method necessitating careful tracking. Documenting only cash payments, which is implied in the last option, would significantly restrict the understanding of financial health, omitting essential revenue and expense recognition that accrual accounting provides.