Question

Bridger Canyon Systems Group (BCSG) has substantial year-to-year fluctuations in billings to clients. Top management has the following policy regarding the employment of key professional personnel:


Top management believes that the group should maintain a minimum of 10 individuals for a year or more even if billings drop drastically below $2 million.
For the past 5 years, gross annual billings for BCSG have fluctuated between $2,020,000 and $2,380,000. Expectations for next year are that gross billings will be between $2,100,000 and $2,300,000. What amount should the group budget for key professional personnel salaries? Graph the relationships on an annual basis, using the two approaches (refined and simplified) illustrated in Exhibit 2-6 on page 42.
Indicate the relevant range on each graph. You need not use graph paper; simply approximate the graphicalrelationships.


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  • CreatedNovember 19, 2014
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