When calculating the statement of net position, what financial activity is included for capital assets?

The correct choice pertains to the sales or disposition of capital assets, which is a crucial aspect when calculating the statement of net position. The statement of net position reflects a government's overall financial position at a specific point in time, and capital assets play a significant role in that representation.

When a government sells or disposes of capital assets, this activity directly impacts the financial statements. The proceeds from the sale of capital assets would typically result in a gain or loss, which must be recognized in the government’s accounts. This transaction affects the value of capital assets reported and adjusts the net position accordingly. The disposition of these assets either increases or decreases the total net position based on how much was received versus the book value of the asset.

In contrast, the other options do not align with how capital assets are represented in the statement of net position. Capital acquisitions contribute to the total asset base but do not reflect the overall financial activity in relation to net position on their own. Investment earnings pertain to the income generated from investments, which is reported separately and does not directly impact the capital asset section of the statement. Depreciation expense affects the carrying amount of capital assets but is accounted for over time and is a systematic allocation of cost rather than a transaction that alters