1. On June 1, 2017, Adam Inc. agreed to purchase $200,000 in U.S. currency for $222,000 in Canadian currency in 45 days from Bay Bank. The balance sheet date of Adam Inc. is June 30. On June 30, 2017, the fair value of the forward contract was determined to be $7,000 in Canadian dollars. On July 15, 2017, Adam Inc. settled the forward contract by taking delivery of the U.S. dollars. The U.S. dollar was worth $1.14 Canadian dollars on July 15, 2017.

Required: Prepare journal entries needed at June 30, 2017 and July 15, 2017.