Question: EXERCISE 2-4 Fixed and Variable Cost Behavior [LO 2-4) Espresso Express operates a number of espresso coffee stands in busy suburban malls. The fixed weekly

 EXERCISE 2-4 Fixed and Variable Cost Behavior [LO 2-4) Espresso Express

EXERCISE 2-4 Fixed and Variable Cost Behavior [LO 2-4) 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 $0.22 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 off the cost of a cup of coffee to the near- est tenth of a cent. Cups of Coffee Served in a Week 2,000 2,100 2,200 ? ? ? ? Fixed cost. Variable cost Total cost ... Average cost per cup of coffee served ? ? ? ? ? ? ? 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? Explain

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