Carson Allister is performing an MUS application in the audit of Bird Companys accounts receivable. Based on the acceptable level of the risk of incorrect acceptance of 5 percent and a tolerable misstatement of $120,000, Allister has calculated a sample size of 75 items and a sampling interval of $25,000. After examining the sample items, the following misstatements were identified: (Use Exhibit F.A.2)

Item	Recorded Balance	Audited Value
1	$35,000	$28,000
2	10,000	8,000
3	6,000	3,000

Required: a. Calculate the upper limit on misstatements for Bird Companys accounts receivable.

b. Fill in the appropriate blanks to provide a brief description of the meaning of the upper limit on misstatements calculated in part (a).

c. What would Allisters conclusion be with respect to the fairness of Birds accounts receivable balance?