Jordan Thomas is using PPS to examine a client$$s accounts receivable balance. Using a sample size of $100$ items and a sampling interval of $$12,300,$ Thomas identified the following misstatements:

$($Use Exhibit F$.$A$\mathrm{.}2.)$

ItemRecorded BalanceAudited Value$1$$$15,000$$$12,500210,0004,00033,0002,000$

Required:

Calculate the upper limit on misstatements assuming a risk of incorrect acceptance of $(1)5$ percent and $(2)10$ percent.

Note: Do not round intermediate calculations.

Based on your calculations in part $($a$),$ comment on the relationship between the risk of incorrect acceptance and the upper limit on misstatements.