CMT Ltd is the Taiwan subsidiary of a U.S. auto parts manufacturer. CMTs balance

sheet in thousands of Taiwan Dollar (TWD) as of June 30 as follows:

Balance Sheet, June 30, thousands of TWD

Assets

Cash TWD 60,000

Accounts receivable 80,000

Inventory 45,000

Net plant & equipment 58,000

TWD243,000

Liabilities & Net Worth

Accounts payable TWD 72,000

Long-term debt 84,000

Common stock 47,000

Retained earnings 40,000

TWD243,000

Exchange rates for translating CMTs balance sheet into U.S. dollars are:

June 30: $0.034/TWD (exchange rate before 20% appreciation)

Dec. 31: $0.0408/TWD (exchange rate after 20% appreciation)

The TWD increased in value from $0.034/TWD to $0.0408/TWD between June 30 and Dec. 31. Assuming no change in balance sheet accounts between these two days, calculate the gain or loss from translation by both the current rate method and the temporal method. (8 points) Please show your work.