Espanola Corporation, a Canadian corporation, engaged in the following transactions in late 20X7 and early 20X8:
December 2 purchased sheet aluminum from a US subsidiary of a Canadian aluminum company for US$ 160,000, payable in 60 days.
December 2 acquired a forward contract to receive US$ 160,000 in 60 days, as a hedge of the account payable. The forward contract rate was C$ 1.10.
December 20 Sold large cans to a Buffalo canner for US$ 200,000, due in 60 days.
January 31 received US$ 160,000 on the forward contract; paid US$ 160,000 to the aluminum company.
February 18 received US$ 200,000 from the Buffalo canner.
Spot rates for the US dollar were as follows:
December 2............................ $ 1.07
December 20........................... $ 1.12 December 31........................... $ 1.14
January 31............................ $ 1.20
February 18............................ $ 1.17
The January 31, 20X8, forward rate on December 31, 20X7, was $ 1.15.

Required
Prepare journal entries for these transactions, including any adjusting entries needed at the December 31, 20X7, year-end.