6. At 8:00 A.M. on a Monday morning, your super- vising attorney rushes into your office. She states that. at nat 10:00 a.m. she has a meeting with one of the firm's admin- s istrators to go over her draft version of the proposed budger for her satellite office. Although the office is relatively small, she must submit a budget that will produce a r'eason.able profit for the firm. Unfortunately, she has a meeting with a client and a court appearance to go to before the 10:00 A.m. meeting. She hands you a list of her notes and asks you to please come through for her on this one. You reluctantly agree, but then remember that your bonus at t}}e end of the year will depend on how profitable your office is. Suddenly, you feel better about the assignment. Below are the attorney's notes. Rent is $5000 a month, but halfway through the year the lease calls for a 5% increase. o The paralegals will bill at $80 an hour and must work a minimum of 1750 hours. You think that they will do this, since they will not be eligible to receive a bonus unless they work this amount. Utilities are included in the lease agreement, so do not worry about these. : * Associates will bill at $225 an hour. You figure that they will bill no less than 1900 hours because if they do not, they will not look good for a partner- ship position. From past history, the firm has determined that its time-to-billing percentage is 98% and the realiz: tion rate is 92%. a * Telephone cost is expected to be $4,000 a me Staffing is as follows: ; Two paralegals Four secretaries Three associates Last year, paralegals were paid, on average, secretaries, $40,000; and associates, $90,00 0. 3.5% cost-of-living adjustment and a 2.5% m Fringe benefits and taxes are figured at 25 total of the salaries. ] * Office supplies and stationery expenses about $20,000. . The office must purchase four computers best estimate is that they will cost abou each when all costs are included (instz ' cabling, software, printers, network h training, maintenance contract, etc.). . ..All other items, such as malpractice/geng Insurance and professional services, to your office by the accounting of need to worry about this now, P