Swell Computers is a public company that manufactures desktop and laptop computers. The components of the financial statements are (1) income before taxes = $500,000, (2) total assets = $2.2 billion, and (3) total revenues = $7 billion. a. Determine overall materiality and tolerable misstatement. Justify your decisions.

b. During the course of the audit, Swells CPA firm detected one misstatement that resulted in an overstatement of income by $1.5 million. Evaluate the audit findings. Justify your decisions.