On that date, the foreign subsidiary borrowed $5,000,000$ from local banks on a $10-$year note to finance the acquisition of PPE. The subs opening balance sheet in AWG was:Elms Duty$-$Free Goods N$.$V$.$Balance SheetJanuary $1,$ Year $1$Cash$3,000,000$Long$-$term debt$5,000,000$PPE$5,000,000$Stock$3,000,000$TOTAL $8,000,0008,000,000$During the year, the subsidiary generated sales of $10,000,000$ and net income of $1,100,000.$ The subsidiary declared equal amounts of dividends on June $1$ and December $1.$ Inventory was acquired evenly throughout the year, with ending inventory acquired on Nov $1,$ Y$1.$ See next page for financial statements in AWG. Dixon Duty$-$Free Goods N$.$V$.$Income Statement For year ended December $31,$ Year $1$Sales$10,000,000$Cost of Goods Sold$(6,000,000)$Gross profit$4,000,000$Depreciation expense$500,000$Other operating expenses$1,500,000$Income before tax$2,000,000$Income taxes$900,000$Net Income$1,100,000$Dixon Duty$-$Free Goods N$.$V$.$Statement of Retained EarningsFor year ended December $31,$ Year $1$Retained earnings, $1/1/$Y$10$Net Income $1,100,000$Dividends $(400,000)$Retained Earnings, $12/31/$Y$1700,000$Dixon Duty$-$Free Goods N$.$V$.$Balance SheetDecember $31,$ Year $1$Cash $800,000$Accounts payable $800,000$Receivables $1,500,000$Long$-$term debt$5,000,000$Inventory$2,700,000$Common stock$3,000,000$PPE $($net$)4,500,000$Retained earnings$700,000$TOTAL ASSETS$9,500,0009,500,000$Relevant exchange rates for Year $1$ are $($USD per AWG$)$:January $1,$ Y$1$USD $0\mathrm{.}530$June $1,$ Y$10\mathrm{.}535$Average for year $10\mathrm{.}540$November $1,$ Y$10\mathrm{.}554$December $1,$ Y$10\mathrm{.}561$December $31,$ Y$10\mathrm{.}5677-1$a$.$ Translate the subsidiarys financial statements into USD, assuming the Aruban guilder is the functional currency. $7-1$b$.$ Compute the translation adjustment by considering the impact of exchange rate changes on the subsidiarys net assets$\mathrm{.}7-2$a$.$ Remeasure Dixon Duty$-$Free Goods N$.$V$.$s financial statements into USD, assuming that the USD is the functional currency$\mathrm{.}7-2$b$.$ Compute the remeasurement gain or loss by considering the impact of exchange rate changes on the subsidiarys net monetary asset or liability position.