Reconsider the law firm of Exercise 5.1. Assume the prevailing revenues per shopping and medical projects are

Question:

Reconsider the law firm of Exercise 5.1. Assume the prevailing revenues per shopping and medical projects are $ 4000 and $ 5000 per project, respectively, and that out of pocket expenses associated with each project are negligible. The (fixed) cost of operating the office is $ 500,000 per month.
a. What type of project is the most profitable?
b. At the current product mix (50%- 50%), how much is generated ($ per day)?
c. At the current product mix, what is the profit at capacity?
d. At the current product mix, what is the value of hiring an extra Paralegal? Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...