Income is recognized when:

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Income is recognized when there is an increase in future economic benefits that results in an increase in assets or a decrease in liabilities and it can be measured reliably. This aligns with accrual accounting, where revenue is recorded when earned, not merely when cash is received. An asset’s value rising on its own isn’t automatically income unless it stems from the entity’s performance and can be reliably measured. Likewise, a liability decreasing without an accompanying asset change doesn’t by itself create income. Cash receipts are not the trigger for recognition; income can be earned before cash is received. So the best description is the one that ties income to a reliable increase in future economic benefits through asset increases or liability decreases.