A city's governmental funds balance sheet reports total assets of $71 million. The government-wide statement of net position for the same date reports total assets of governmental activities of $350 million. What is the most likely reason for the discrepancy between these two numbers?

Question

Quizplus · Accepted Answer

The government-wide statement of net position includes capital assets (such as buildings, infrastructure, and equipment) used in governmental activities, which are not reported on the governmental funds balance sheet. The governmental funds balance sheet primarily focuses on current financial resources and does not include capital assets.

A City's Governmental Funds Balance Sheet Reports Total Assets of $71