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Exercise 5-17 (Algo) Analyzing inventory errors LO A2 Vibrant Company had $1,080,000 of sales in each of Year 1, Year 2, and Year 3, and it purchased merchandise costing $590,000 in each of those years. It also maintained a $380,000 physical inventory from the beginning to the end of that three-year period. In accounting for inventory, it made an error at the end of Year 1 that caused its Year 1 ending inventory to appear on its statements as $360,000 rather than the correct $380,000. 1. Determine the correct amount of the company's gross profit in each of Year 1, Year 2, and Year 3. 2. Prepare comparative income statements to show the effect of this error on the company's cost of goods sold and gross profit for each of Year 1 Year 2, and Year 3. Answer is complete but not entirely correct. Complete this question by entering your answers in the below tabs. Required 1 Required 2 Prepare comparative income statements to show the effect of this error on the company's cost of goods sold and gross profit for each of Year 1, Year 2, and Year 3. VIBRANT COMPANY Comparative Income Statements Year 1 Year 2 $ 1,080,000 $ 1,080,000 3-year total Year 3 S 1,080,000 Sales S 3,240,000 Cost of goods sold Beginning inventory Cost of purchases Goods available for sale Ending inventory Cost of goods sold Gross profit $ 380,000 590,000 970,000 360,000 $ 360,000 590,000 950,000 360,000 360,000 590,000 950,000 360,000 610,000 $ 470,000 590,000 490,000 590,000 $ 490,000 1,790,000 1,450,000 S S