120 Hours ($) 150 Hours ($)

Salaries:

Junior lawyer 4,500 4,500

Office assistant 1,800 1,800

Internet and software subscriptions 700 850

Consulting by senior partner 1,200 1,500

Depreciation (equipment) 2,400 2,400

Pamphlets aod promotion 600 700

Supplies 905 1,100

Administration 500 500

Rent (offices) 2,000 2,000

Utilities 332 365

3.Seth Jones, the chief accountant of the firm, has estimated that the clinic will average 140 professional

hours per month. What would the total cost of operating the clinic be? How much

is variable? How much is fixed?

4. If the clinic is to be operated as a not-for-profit organization, how much will it need to charge

per professional hour?

5. Suppose the legal clinic averages 170 professional hours per month. How much would need

to be charged per hour for the clinic to cover its costs? Explain why the per-hour charge

decreased as the activity output increased.