Creating logos is part and parcel of my job Messenjah. (I'm the Creative Dirctor of an Advertising and Graphic Design firm
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Believe it or not - your best bet for a simple (cheap) logo may be reworking / retouching some appropriate, high quality, royalty free clip art. I say royalty free because if your boss wants legal prtection of his IP (intellectual property) he's going to ahve to make it a trademark - and that can only happen if your design can be considered an \"original artwork\" and therefore patentable. If you use rights protected stuff, someone WILL sue your arse eventually.
As long as you change the image a lot and as long as the clip art is a vector drawing you should be fine (forget photoshop for your logo unless it's specifically a bitmap image your boss wants - which I DON'T recommend).
What you really need to do is create something in Illustrator or Freehand. Remember that your company will eventually have to put it's logo on everything from business cards to T-shirts to Cars to Outdoor billboards - so if it's not scalable, you're going to have major problems. Also try to make your logo Squareish rather than rectangular (square logos look better at small sizes - plus they lend themselves to more applications, especially with a logo built around alpha-numeric characters, as yours will be.)
The first thing you need to do is write out a good design brief - which means you have to answer these questions as well as you can:
1. Why are we doing this? (pretty obvious in this case)
2. Who are we talking to (Who's our target market?)
3. What are their current perceptions about our company?
4. What are the desired perceptions about our company?
5. WHAT IS THE PROPOSITION? (Most important question to answer. In this case - your proposition is your market positioning. Try to figure out what your business does well - why people choose your business over your competitors - then try to communicate that idea with your design).
6. What is the tone and manner? (What is your company like: Conservative like a bank? Modern and stylish like Apple? Funky? Sombre? Funny? Small? Big? This will be a major consideration.)
7. What are our competitors doing with their logos? (You don't want to be confused for someone else)
8. What is the budget?
9. What are the mandatory elements (things you MUST include: Corporate colours, a particular font, a business description / byline / slogan)
10. Where will this logo be used / reproduced? (If all it's going to appear on is stationery, signage and websites then it's pretty easy. If it also needs to be embroidered onto uniforms, banners etc, then you need to design with this in mind.
11. What is the timeline? (how long do you have to finish the job - better to have a logo 75% right and out in the marketplace than 90% right but still on your desk)
There's so much more I could say, but this post is becoming an essay. Message me if you want more advice / tips / professional feedback on your design etc.
Good luck