Question: Your uncle Bob, a CPA, has recently started and he wants your advice on some tests of sales transactions he is conducting. Bob selected a

Your uncle Bob, a CPA, has recently started and he wants your advice on some tests of sales transactions he is conducting. Bob selected a haphazard sample of 15 sales with a total book value of $75,000. In his sample, he found a total of $500 in net overstatement errors. The total sales balance per book is $10,000,00. Overall materiality for the engagement is $300,00. Tolerable misstatement for the engagement is $70,000. If the sample results indicate that Bob's best estimate of total misstatement in sales is $35,000, can Bob safely conclude that no additional work is needed in this area? Include in your answer a clear discussion of how sample results are compared to tolerable misstatement.

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