The existing logo image is 60px x 57px, but you can use a larger image if you wish. You will just have to make adjustments to the height below (width will likely be adequate).
I would suggest creating a child theme so that any theme update does not overwrite your changes: http://codex.wordpress.org/Child_Themes . I suggest uploading the image to your media library so that again, it isn't overwritten in a theme update. Get the URL of that uploaded image and then replace the relative URL between the double quote marks below with the full (absolute) URL of the uploaded image.
background: url("images/logo.png") no-repeat scroll 10px 0 transparent;
margin: 0 auto;