Salt City issued $5 billion of bonds at face value to fund the reconstruction of the major interstate highways in and around their city. The bond underwriters withheld $2 million for underwriting fees and remitted the balance to the City. Assuming the City maintains its books and records in a manner that facilitates the preparation of fund financial statements, how would the underwriting fee be accounted for in the capital projects fund?

Group of answer choices

Reduce Other Financing Sources by $2 million.

Reduce Bonds Payable by $2 million.

Increase Expenditures by $2 million.

It would not be accounted for in the capital projects fund.