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Smith and Baker Legal Services employs five full-time attorneys and nine paraprofessionals. Budgeted salaries are $100,000 for each attorney and $50,000 for each paraprofessional. Budgeted indirect costs (e.g. rent, secretarial support, copying, etc.) are $21 0,000. The company traces the cost of attorney and paraprofessional time to each client and uses the total to assign indirect costs.
Required:
What amount of indirect costs would be assigned if services to a client required $25,000 of attorney cost and $20,000 of paraprofessional cost?
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