it 's from schweser practice exam vol1, Exam3 AM, Q49. Balance sheet of Wayward Inc (in LC) --------------------------------------12/31/07------------12/31/08 ----------correct data Cash + account receivable------5000-----------------5200 Inventory---------------------------3800---------------- 4900 PPE----------------------------------6200-----------------7400 Total assets----------------------15000---------------17500 account payable-----------------2000----------------- 2000 long-term debt------------------ 9000----------------- 9500 -------------- 12000 equity----------------------------- 4000----------------- 6000 ----------------3500 spot rate on 1/1/08: $0.35per LC spot rate on 12/31/08: $0.45 per LC Ave. spot rate during 08: $0.42 per LC 1)With all-current method, how much is the currency translation gain/loss? under all-current method, parent’s exposure= equity BEG equity=4000 END equity=6000 during net monetary equity increase= 6000-4000=2000 since LC app., it 's a translation gain= 4000*(.45-.35)+2000*(.45-.42)=460 and it’s reported on balance sheet. 2) one day later, some errors reported, for year end, equity correct data :3500, long-term debt:12000. how much is the currency translation gain/loss? under all-current method, parent’s exposure= equity BEG equity=4000 END equity=3500 during net monetary equity increase= 3500-4000=-500 since LC app., it 's a translation gain= 3500*(.45-.35)+(-500)*(.42-.35)=315 and it’s reported on balance sheet. what’s your opinion?