In: Accounting
Espresso Express operates a number of espresso coffee stands in busy suburban malls. The fixed weekly expense of a coffee stand is $1,200 and the variable cost per cup of coffee served is .74
Fill in the following table with your estimates of totalcosts and cost per cup of coffee at the indicated levels ofactivity for a coffee stand. Round off the cost of a cup ofcoffee to the nearest tenth of a cent.
Does the cost per cup of coffee served increase, decrease,or remain the same as the number of cups of coffee served in a weekincrease?
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Please note that the data is not fully provided like number of cups served in a week. but you can see my workings and update the values or you can ask me in comments and provide the values I will update my answer if there is some inaccuracy. |
Espresso Express | Note | |||
Workings for Answer 1 | 1200 | 1300 | 1400 | A |
Variable cost per cup | 0.74 | 0.74 | 0.74 | B |
Total Variable cost | 888.00 | 962.00 | 1,036.00 | C=A*B |
Answer 1 | 1200 | 1300 | 1400 | See A |
Fixed cost | 1,200.00 | 1,200.00 | 1,200.00 | D |
Variable cost | 888.00 | 962.00 | 1,036.00 | See C |
Total cost | 2,088.00 | 2,162.00 | 2,236.00 | E=D+C |
Average cost per cup | 1.74 | 1.66 | 1.60 | F=E/A |