City A issues $10 million of 30-year bonds and uses the proceeds to build a system of bike paths and mini-parks. What is the impact of this event on the Statement of Net Position (aka Statement of Net Assets) for the City's Governmental Activities and on the Balance Sheet for its Governmental Funds? (Don't worry about which Governmental Fund for now. Just think of the Governmental Funds as a group. Just focus on the impact of this event on the financial statements.)
Added by Kari S.
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Statement of Net Position for Governmental Activities: The issuance of $10 million of bonds will increase the City's assets by $10 million (cash received from the bond sale) and increase its liabilities by $10 million (the bond principal). Therefore, the net Show more…
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