Upper Limit on Misstatements Calculation: Monetary Unit Sampling. Jordan Thomas is using MUS to examine a clients accounts receivable balance. Using a risk of incorrect acceptance of 5%, a tolerable misstatement of $65,000, a sample size of 100 items and a sampling interval of $12,300, Thomas identified the following misstatements:

Item	Recorded Balance	Audited Value
1	$15,000	$12,500
2	10,000	4,000
3	3,000	2,000

Questions:

1) What is the projected misstatement?

2) What is the basic allowance for sampling risk?

3) What is the incremental allowance for sampling risk?