A government's Statement of Revenues, Expenditures, and Changes in Fund Balances reflected expenditures for debt service in the amount of $12,000,000, including $7,000,000 for interest. It also reflected proceeds of bonds in the amount of $4,000,000. No interest accruals were involved. When moving from the changes in fund balances reported for the governmental funds to the change in Net Position for governmental activities, the net change would be:

Question

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Bond Proceeds of $4,000,000 would be subtracted and $5,000,000 in debt service would be an addition resulting in a net increase of $1,000,000.

A Government's Statement of Revenues, Expenditures, and Changes in Fund