Use the 3-step adjusting entry process to prepare the adjusting entry necessary to correctly report the revenue earned or the expense incurred: Step 1: Determine what the current account balance equals (See General Ledger tab) Step 2: Determine what the current account balance should equal. Step 3: Prepare an adjusting entry to get from Step 1 to Step 2.

Jenna Aracel opened a business called Aracel Engineering and recorded the following transactions in its first month of operations.
Jun. 1	Jenna Aracel, the owner, invested $100,000 cash, office equipment with a value of $5,000, and $60,000 of drafting equipment to launch the company.
Jun. 2	The company purchased land worth $49,000 for an office by paying $6,300 cash and signing a long-term note payable for $42,700.
Jun. 2	The company purchased a portable building with $55,000 cash and moved it onto the land acquired on June 2.
Jun. 2	The company paid $3,000 cash for the premium on a 15-month insurance policy.
Jun. 7	The company completed and delivered a set of plans for a client and collected $6,200 cash.
Jun. 12	The company purchased $20,000 of additional drafting equipment by paying $9,500 cash and signing a long-term note payable for $10,500.
Jun. 14	The company completed $14,000 of engineering services for a client. This amount is to be received in 30 days.
Jun. 15	The company purchased $1,150 of additional office equipment on credit.
Jun. 17	The company completed engineering services for $22,000 on credit.
Jun. 18	The company received a bill for rent of equipment that was used on a recently completed job. The $1,333 rent cost must be paid within 30 days.
Jun. 20	The company collected $7,000 cash in partial payment from the client billed on June 14.
Jun. 21	The company paid $1,200 cash for wages to a drafting assistant.
Jun. 23	The company paid $1,150 cash to settle the account payable created on June 15.
Jun. 24	The company paid $925 cash for minor maintenance of its drafting equipment.
Jun. 26	Jenna Aracel withdrew $9,480 cash from the company for personal use.
Jun. 28	The company paid $1,200 cash for wages to a drafting assistant.
Jun. 30	The company paid $2,500 cash for advertisements on the web during June.
Descriptions of items that require adjusting entries on June 30, 2015, follow.
a)	The company has completed, but not yet billed, $6,000 of engineering services for a client.
b)	Straight-line depreciation on the office equipment, assuming a 5-year life and a $150 salvage value, is $100 per month.
c)	Straight-line depreciation on the drafting equipment, assuming a 5-year life and a $2,000 salvage value, is $1,300 per month.
d)	Straight-line depreciation on the building, assuming a 25-year life and a $1,000 salvage value, is $180 per month.
e)	The balance in prepaid insurance represents a 15-month policy that went into effect on June 1.
f)	Accrued interest on the long-term note payable is $75.
g)	The drafting assistant is paid $1,200 for a 5-day work week. 2 days' wages have been incurred but are unpaid as of month-end.