Hi Ashley,
Option “Define a new report type that includes accounts and the custom object” would be Best.
1.) From Setup, enter Report Types in the Quick Find box, then select Report Types.
2.) Click New Custom Report Type.
3.) Select the Primary Object for your custom report type.
You can choose from all objects—even those you don’t have permission to view. This lets you build report types for a variety of users.
Once you save a report type, you can’t change the primary object.
If the primary object on a report type is a custom or external object, and that object is deleted, the report type and reports created from it are deleted.
If you remove an object from a report type, all references to that object and its associated objects are removed from the reports and dashboards based on that type.
4.) Enter the Report Type Label and the Report Type Name.
The label can be up to 50 characters long. The name is used by the SOAP API.
5.) Enter a description for your custom report type, up to 255 characters long.
6.) Select the category in which you want to store the custom report type.
Thanks.