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Exercise 2-4 Fixed and Variable Cost Behavior [LO2-4] Espresso Express operates a number of espresso coffee...

Exercise 2-4 Fixed and Variable Cost Behavior [LO2-4]

Espresso Express operates a number of espresso coffee stands in busy suburban malls. The fixed weekly expense of a coffee stand is $1,000 and the variable cost per cup of coffee served is $0.33.


Required:
1.

Fill in the following table with your estimates of total costs and cost per cup of coffee at the indicated levels of activity for a coffee stand. (Round the Average cost per cup of coffee served to 3 decimal places.)

     

2.

Does the average cost per cup of coffee served increase, decrease, or remain the same as the number of cups of coffee served in a week increases?

  • Increase

  • Decrease

  • Remain the same

rev: 10_19_2016_QC_CS-66735

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