A governmental fund Statement of Revenues,Expenditures,and Changes in Fund Balances reported expenditures of $30 million,including capital outlay expenditures of $9 million.Capital assets for that government cost $90 million,including land of $10 million.Depreciable assets are amortized over 20 years,on average.The reconciliation from governmental changes in fund balances to governmental activities changes in would reflect a(an):

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The reconciliation from governmental changes in fund balances to governmental activities changes in would reflect an increase of $5 million. This is because capital outlay expenditures are not considered expenses in governmental activities, but are instead capitalized and depreciated over time. Therefore, the $9 million of capital outlay expenditures would be added back to the $30 million of expenditures reported in the Statement of Revenues, Expenditures, and Changes in Fund Balances to arrive at the $39 million of expenses that would be reported in the Statement of Activities.

A Governmental Fund Statement of Revenues,Expenditures,and Changes in Fund Balances