Translation:This panda is so cute!
I think 可愛 is a generic cuteness. 萌 is borrowed from Japanese "moe" which generally refers to affection for a cute character.
"this panda is too cute!" was rejected but I think should be accepted. I prefer to think of 太 as meaning "too", though I realise these words are flexible and meanings overlap. This Duolingo course seems to have a preference for translating it as very or so.
got an email earlier today [28/11/17] to say this translation is now accepted
well for me in English "too" something sounds negative. Like "it's too cold" or "he's too poor". In Chinese on the other 太 can mean both "too" something or "very/so" - negative and positive. Like: 太贵了！（too expensive！） or 太辣了！（too spicy！） but also 太便宜了！（so cheap！） and 太可爱了！（so cute！）
I am not sure if the meaning in this sentence comes from Japanese or not. But i sure 萌 is an old Chinese word. it means "grow" as "the seed grows into the plant" and has some other similar meanings. I think in this sentence, it is cute and a little bit stupid like a puppy.
萌(Méng), it appears in many old and very famous poems and literatures. for example: 韓愈: "秋瓜未落蒂, 凍芋強抽萌 ( 石鼎聯句) Từ Dũ: Dưa thu chưa rụng cuống, Khoai đông đã nhú mầm mạnh mẽ (Thạch đỉnh liên cú). 三國演義: " 若萌異心, 必獲惡報 " Tam Quốc Diễn nghĩa: Nếu (sau này) sinh lòng khác (thay lòng đổi dạ), ắt bị ác báo. My English is not so good, so i can not translate to the meaning of above, just Vietnamese.
and I know that 萌 also is the family name in China. In Vietnamese, we has a similar word and meaning, "manh", and I think it comes from Chinese
It means more general cuteness. The definition isn't as specific as it is in Japanese.
Shouldn't the tone for 只 be 1st instead of 3rd? In the MDBG dictionary, only the variant with the 1st tone is translated as "classifier for birds and certain animals".