The 2,000 accounts receivable of ABC Company have a total book value of $40,000. Bob Rotter, CPA, has selected and audited a sample of 100 accounts with a total book value of $1,950. The audited value of the 100 accounts in the sample is $1,875.

Using the ratio estimation technique, Rotter's estimate (to the nearest dollar) of the projected/likely misstatement is

$1,538

$7,500 wrong

$1,600

$8,500