Reference no: EM132148643
LegalPlus, a chain of law offices, operates in several locations throughout the nation. Each location is staffed by professional lawyers and paralegals. LegalPlus presently employs 85 full-time equivalent (FTE) lawyers and 175 FTE paralegals. Management is currently reviewing its staffing levels to plan for the upcoming year. A recent forecast of the expected workload for the next year shows that at least 250 FTE employees (both lawyers and paralegals) will be required to staff its locations. The personnel department expects 10 lawyers and 30 paralegals to either leave or retire from the company over the next year. To accommodate the expected attrition and prepare for future growth, management estimates that the firm must hire at least 15 new lawyers. In addition, management stated that there should be no more than two paralegals per professional lawyer. The average salary for a professional lawyer is $40 per hour and the average salary for a paralegal is $10 per hour.
Assuming L = number of full-time equivalent lawyers, and P = number of full-time equivalent paralegals
Develop a linear programming model to determine the minimum cost per hour staffing plan for LegalPlus for the upcoming year.
Identify how many professional lawyers and how many paralegals must be employed (in total for each) in the upcoming year.
Given the current staffing levels and expected attrition, how many new hires (if any) must be made to reach the level recommended in Question 2?
What will be the overall per-hour cost impact on payroll for the upcoming year?
Assuming LegalPlus bills clients at an average rate of $100 per hour per lawyer and $50 per hour per paralegal, what is the forecasted revenue for the upcoming year if the company expects to bill 1,500 lawyer hours and 1,800 paralegal hours?
Assuming each employee (lawyers and paralegals) is expected to be paid (salaries expense) for 2,080 annual hours, what is the forecasted expense for salaries in the upcoming year?
What would be the forecasted contribution to LegalPlus after salaries but before other expenses for the upcoming year? Hint: forecasted revenue minus forecasted salaries expense.
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