Deck 8: Billing and Financial Management

Question 1

The most common method of billing is

A)frequent
B)monthly
C)weekly
D)bimonthly
E)brief

Answer 1

B

Question 2

A firm's profitability depends on

A)the realization rate
B)a firm's client base
C)management's handling of firm resources
D)collecting accounts receivable
E)none of the above

Answer 2

C

Question 3

The two types of expenses are

A)compensation expenses and operating expenses
B)occupancy expenses and office expenses
C)professional activity expenses and general business expenses
D)operating expenses and general business expenses
E)none of the above

Answer 3

A

Question 4

When discussing a client's bill with a client,a paralegal may

A)estimate the cost of the case
B)suggest a solution to the billing problem
C)give advice on the way the case should be handled
D)inform the client of the duration of the case
E)none of the above

Question 5

Office operating costs include the day-to-day expenses in running an office.

Question 6

A paralegal may not discuss billing concerns with a client.

Question 7

E-billing is

A)calculating a client's bill using electronic means
B)sending a bill to a client via the Internet
C)an acronym for an excessive bill
D)the name of the last bill sent when a case ends
E)none of the above

Question 8

As time passes,a client's perception of the value of legal services

A)decreases
B)increases
C)stays the same
D)vanishes
E)none of the above

Question 9

Charging interest on past due accounts

A)has been very successful to encourage clients to pay their bills
B)is prohibited by the ABA
C)is rarely collected
D)a and c only
E)none of the above

Question 10

An expense percentage is calculated by

A)adding all expense items
B)subtracting expenses from income
C)dividing income by expenses
D)dividing expenses by income
E)none of the above

Question 11

The most important aspect of the billing process is

A)the initial client interview
B)frequent bills
C)recording the work
D)collection techniques
E)communication

Question 12

When should an engagement letter be sent to the client?

A)after the initial client interview
B)before the initial client interview
C)after the fee agreement is signed
D)before the fee agreement is signed
E)when the case is closed

Question 13

It is the responsibility to discuss the fee agreement with the client.

A)administrator's
B)paralegal's
C)attorney's
D)secretary's
E)b and c only
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Question 14

When projecting income,firms consider

A)marketing activities
B)income generated from each timekeeper
C)economic environment
D)competitive pressures
E)all of the above

Question 15

A realization rate is based on

A)a paralegal's hourly rate
B)an attorney's hourly rate
C)the amount ultimately received in a contingency case
D)the amount a firm actually receives
E)none of the above

Question 16

The goal of a firm's billing policy is to

A)get as much money as possible
B)get the bills paid as quickly as possible
C)make clients aware of the value of the services
D)enhance the attorney-client relationship
E)all of the above

Question 17

A paralegal in a large firm may be directly responsible for preparing bills.

Question 18

Frequent billing is the most important aspect of the billing process.

Question 19

Management projects personnel costs to prepare a firm's budget.

Question 20

The essential elements of the billing process are

A)communication,understanding,regular billing,and descriptive bills
B)constructive feedback,understanding,frequent billing,and brief bills
C)communication,understanding,fee agreement,and realization
D)attorney-client relationship,fee agreement,realization rate,and budget
E)none of the above

Question 21

Anticipation of uncollectible debts is an important function of the process.

Question 22

Clients may pay their legal bills with credit cards.

Question 23

is the most important aspect of the billing process.

Question 24

The has the authority to adjust a client's bill.

Question 25

Clients prefer to receive large monthly bills rather than small infrequent bills.

Question 26

Management strives for an) to percent realization rate for each timekeeper.

Question 27

Time records are never kept for a contingency case.

Question 28

The style of bill used depends on the type of case and type of client.

Question 29

A legal auditor reviews attorney's bills for what types of business? and
.

Question 30

If a client refuses to pay,a lawyer may withdraw from the case if .

Question 31

The higher the expense percentage,the more profitable the firm.

Question 32

firms have the most difficulty billing clients monthly.

Question 33

In order to project a firm's gross income,management must anticipate future work from new clients.

Question 34

A paralegal must document all client communications.

Question 35

A preliminary bill is prepared so the attorney may add or subtract charges from it.

Question 36

The key to law firm profitability is an) .

Question 37

Legal auditors are hired to find overbillings from law firms.

Question 38

All firms agree on the style of legal bills.

Question 39

Realization is the process of turning into cash.

Question 40

The is responsible for setting billing policies.

Question 41

A firm usually waits until the end of the case to bill a client in an) case.

Question 42

An attorney cannot apply client's funds to a .

Question 43

A form)is used to adjust a client's bill.

Question 44

The two styles of hourly fee bills are and .

Question 45

A brief bill is sufficient in a case.