A wholesale company, Birch Corp., is preparing financial statements as of and for the year ended December 31, Year 5. You have been asked to review the unadjusted inventory subledger and determine the necessary adjustments, if any, to properly report the inventory balance as of December 31, Year 5, using the information in the exhibits above. The company's purchase and sales terms are FOB destination.

To arrive at the adjusted inventory balance: Click in the cells in column A and select the appropriate description of the required adjustment. A description may be used once or not at all. In the cell in column B, enter the corresponding amount of the adjustment. Enter additions to the inventory balance as positive whole values, and deductions from the inventory balance as negative whole values. Not all rows might be required to determine the adjusted inventory balance.