Thunderbird is not listing IMAP folders correctly.
The Thunderbird IMAP Server Directory needs to be updated in Thunderbird Settings.
- Click Tools > Account Settings
- Select your email account from left
- Click Server Settings
- Click the Advanced button
- For IMAP server directory enter INBOX
- Tick Allow server to override these namespaces
- Click OK
- Close and restart Thunderbird for the change to take effect.