Which of the following must be included in the government-wide statement of activities?

The correct answer reflects the requirement that the government-wide statement of activities must focus on transactions that impact external parties. This statement is designed to present a broader overview of the government's overall financial position and include a summary of the revenues earned and expenses incurred that directly affect citizens, businesses, and other governments outside of its operations.

The inclusion of revenues and expenses affecting external parties is essential because it provides stakeholders with vital information about the government's financial activities and performance in a way that's relevant to the public. This aids in assessing how effectively the government is managing its resources and fulfilling its mission to serve the community.

In contrast, including internal service fund transactions or internal transactions would not provide a comprehensive picture of the government's operations as experienced by external parties. While financial contributions from governmental units are important, they do not directly address the external activities in the same manner as revenues and expenses affecting external parties. Thus, the statement of activities aims to capture the net effect of government activities on the governmental entities that interact with it, ensuring that the focus remains on the external perspective.