Rule: The reporting status of a governmental unit is determined by whether it can stand-alone by it SELF based on the following organizational characteristics:

Governments that meet all three criteria are reported as primary governments while those that fail any of the criteria are considered component units. In addition, governments that are component units whose governing bodies are substantially the same as the primary government or which exclusively serve the primary government of which it is a component or that fail to qualify as a legally separate entity are blended. Failing to meet the blending criteria, the component unit is presented discretely (as a separate column) in the primary government's financial statements. Choice "B" is correct. The library is not financially independent since it is subject to budgetary approval from another body (the city). It is a component unit. The library serves the general citizenry of the city, is otherwise governed by a separately elected board, and is assumed to be legally separate. The library does not meet the criteria for blended presentation and is therefore presented discretely.
Choices "d", "a", and "c" are incorrect per the above explanation and rule.