15. Translation temporal 5 pong Please refer to Table 4 in the datafile. If Euro Trade applies the temporal method of translation, what will be the effect of an increase in the EUR/USD exchange rate? (Note: gain = equity increases; loss = equity decreases) = a) impossible to determine Ob) no effect translation loss d) translation gain 4 4 A B B D E F G H H EuroTrade Americas is a US subsidiary of a Dutch company. The subsidiary uses USD as functional currency and its balance sheet has to be translated into EUR every quarter. USD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Assets Cash Accounts receivable Inventory Net plant & equipment Total 3 000 000 2 000 000 1 600 000 2 400 000 9 000 000 Liabilities Accounts payable Short-term bank debt Long-term debt Common stock Total 900 000 1 800 000 2 300 000 4 000 000 9 000 000