LauppCampfitters is the German subsidiary of a U.S. firm. Laupp's balance sheet is shown below in euros and dollars at the historical and current exchange rate of $1.00/‚¬.

a. Translate this balance sheet into dollars at an exchange rate of $0.90/‚¬ under the current rate method of FAS #52. Use the current exchange rate for inventory.
b. Identify exposed monetary assets, exposed monetary liabilities, and net exposed monetary assets under FAS #52.
c. Beginning with the above balance sheet, identify the translation gain or loss from a 30 percent depreciation of the euro under FAS #52.

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Value at Translated value at $0.90/ according to $1.00 $40,000 $40,000 $20,000 € value the current rate method of FAS #52 Assets Cash Accounts receivable 40,000 Inventorv Plant & equipment 700,000 700,000 Total assets Liabilities Accounts payable Long-term debt Net worth Total liabilities - 40,000 20,000 800,000 $800,000 100,000 $100,000 600,000 $600,000 100,000 $100,000 800,000 $800,000