Which components are included in the statement of revenues, expenses, and changes in net position for proprietary funds?

The correct answer reflects the key components of a statement of revenues, expenses, and changes in net position specifically for proprietary funds, which are used by governmental entities to account for activities similar to those found in the private sector.

Proprietary funds include two types: enterprise funds and internal service funds. The statement of revenues, expenses, and changes in net position summarizes the financial activities of these funds over a specific period.

Operating revenues represent the income earned from activities related to the principal operations of the fund. Operating expenses are the costs necessary to conduct those operations. Transfers might be included as they represent movements of resources between funds, which are important for evaluating the financial position and operating results of the proprietary fund.

While investment income and capital expenditures, mentioned in another choice, are relevant to the overall financial condition, they do not specifically classify under the core operating components within the proprietary fund’s statement. Similarly, nonoperating revenues and expenses provide additional financial context, but they do not encompass the operating revenues and expenses that are crucial for assessing the fund’s operational performance. Lastly, beginning and ending cash balances are more related to cash flow statements and do not reflect the performance of revenues and expenses.

Thus, the selected answer encapsulates the essential components that