Please show the works

An auditor has decided to use probability-proportional-to-size (PPS) sampling, sometimes called dollar-unit sampling, in the audit of a clients accounts receivable balances. The auditor plans to use the following PPS sampling table:

Reliability Factors for Overstatements Risk of incorrect acceptance Number of overstatements

Risk of incorrect acceptance

Number of overstatements1% 5% 10% 15% 20%

0 4.61 3.00 2.31 1.90 1.61

1 6.64 4.75 3.89 3.38 3.00

2 8.41 6.30 5.33 4.72 4.28

3 10.05 7.76 6.69 6.02 5.52

4 11.61 9.16 8.00 7.27 6.73

Additional information

Tolerable misstatements (net of effect of expected misstatements) $30,000

Risk of incorrect acceptance 20%

Number of misstatements 1

Recorded amount of accounts receivable $600,000

Number of accounts 360

Which sample size should the auditor use?

a. 30

b. 60

c. 72

d. 120