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Blue Spruce Athletic Wear Inc.s adjusted trial balance amounts (with the exclusion of the adjusting entry to update Inventory and Cost of Goods Sold accounts)

Blue Spruce Athletic Wear Inc.s adjusted trial balance amounts (with the exclusion of the adjusting entry to update Inventory and Cost of Goods Sold accounts) appear in alphabetical order as follows on December 31, 2021, the end of its fiscal year:

Accounts payable $101,065 Inventory, Jan. 1 $49,815
Accounts receivable 54,366 Land 92,250
Accumulated depreciationbuildings 63,714 Mortgage payable 153,750
Accumulated depreciationequipment 52,767 Prepaid insurance 2,952
Administrative expenses 222,507 Property tax payable 5,904
Buildings 233,700 Purchases discounts 27,675
Cash 20,910 Purchase returns and allowances 7,872
Common shares 64,575 Purchases 493,968
Deferred revenue 10,209 Refund liability 5,084
Dividends declared 9,840 Retained earnings 84,378
Equipment 135,300 Salaries payable 4,305
Freight in 6,888 Sales 783,510
Income tax expense 19,680 Selling expenses 9,840
Interest expense 12,792

Additional information:

1. Blue Spruce Athletic Wear uses a periodic inventory system.
2. A physical inventory count determined that Inventory on December 31, 2021, was $89,298.
3. Of the mortgage payable, $15,375 is due in the next year.
4. Common shares of $30,750 were issued during the year.Blue Spruce Athletic Wear Inc.s adjusted trial balance amounts (with the exclusion of the adjusting entry to update Inventory and Cost of Goods Sold accounts) appear in alphabetical order as follows on December 31, 2021, the end of its fiscal year:
Accounts payable $101,065 Inventory, Jan. 1 $49,815
Accounts receivable 54,366 Land 92,250
Accumulated depreciationbuildings 63,714 Mortgage payable 153,750
Accumulated depreciationequipment 52,767 Prepaid insurance 2,952
Administrative expenses 222,507 Property tax payable 5,904
Buildings 233,700 Purchases discounts 27,675
Cash 20,910 Purchase returns and allowances 7,872
Common shares 64,575 Purchases 493,968
Deferred revenue 10,209 Refund liability 5,084
Dividends declared 9,840 Retained earnings 84,378
Equipment 135,300 Salaries payable 4,305
Freight in 6,888 Sales 783,510
Income tax expense 19,680 Selling expenses 9,840
Interest expense 12,792
Additional information:
1. Blue Spruce Athletic Wear uses a periodic inventory system.
2. A physical inventory count determined that Inventory on December 31, 2021, was $89,298.
3. Of the mortgage payable, $15,375 is due in the next year.
4. Common shares of $30,750 were issued during the year.

Prepare the adjusting entry required to update the inventory and related accounts at December 31. Update the affected accounts. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If a journal entry is not required, select "No entry required" for each account name and enter 0 as the amount.)

Date

Account Titles and Explanation

Debit

Credit

Dec. 31

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