Use the Following Information to Answer Bellow Questions
a Belgium $\quad$

Use the following information to answer bellow Questions
A Belgium subsidiary's beginning and ending trial balances appear bellow:
$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\underline{\quad\quad\mathrm{Dr}(\mathrm{Cr) }\quad\quad}$
$\begin{array}{|l|c|c|}\hline&\text { January } 1& \text { December } 31\\\hline \text { Cash, receivables } & € 1,500 & € 1,200 \\\hline \text { Inventories } & 3,000 & 3,500 \\\hline \text { Plant \& equipment, net } & 30,000 & 39,000 \\\hline \text { Liabilities } & (18,500) &(27,200) \\\hline \text { Capital stock } & (4,000) & (4,000) \\\hline \text { Retained earnings, beginning } &(12,000) & (12,000) \\\hline \text { Sales revenue } & - & (15,000) \\\hline \text { Cost of sales } & & 9,500 \\\hline \text { Out-of-pocket selling \& administrative expenses } & - & 4,000 \\\hline \text { Depreciation expense } & \text {-- } & 1,000 \\\hline \text { Total } & €\quad0 & €\quad0 \\\hline\end{array}$
Exchange rates ($/€) are:
$$\begin{array} { l r } \text { Beginning of year } & \$ 1.25 \\\text { Average for year } & 1.22 \\\text { End of year } & 1.20\end{array}$$ The subsidiary was acquired at the beginning of the year. Its sales, inventory purchases, and out-of-pocket selling and administrative expenses occurred evenly during the year. Equipment was purchased for €10,000 when the exchange rate was $1.23. Depreciation for the year includes €200 related to the equipment purchased during the year. The ending inventory was purchased at the end of the year, and the beginning inventory was purchased at the end of the previous year.
-If the subsidiary's functional currency is the euro, what is its exposure to translation gains and losses as of the beginning of the year?

A) € 16,000
B) €(17,000)
C) €(18,500)
D) € 1,500