Exercise 2-3 (Fixed and variable cost behavior) Koffee Express operates a number of espresso coffee stands in busy suburban malls. The fixed weekly expense of a coffee stand is $1,100 and the variable cost per cup of coffee served is $0.26. Required: 1.) Fill in the following table with your estimates of total cost and average cost per cup of coffee at the identical level of activity for a coffee stand. Round off the cost of a cup of coffee to the nearest tenth of a cent. 2.) Does the average cost per cup of coffee served increase, decrease, or remain the same at the number of cups of coffee served in a week increases? Explain Redhawk, Inc., is a merchandiser that provided the following information: Number of units sold 10,000Selling price per unit $15 Variable selling expense per unit. $2 Variable administrative expense per unit. $1 Total fixed selling expense $20,000 Total fixed administrative expense $15,000 Merchandise inventory, beginning balance $12,000 Merchandise inventory, ending balance. $22,000 Merchandise purchases $90,000Required:Prepare a traditional income statementPrepare a contribution format income statementExercise 2-3 (Fixed and variable cost behavior) Koffee Express operates a number of espresso coffee stands in busy suburban malls. The fixed weekly expense of a coffee stand is $1,100 and the variable cost per cup of coffee served is $0.26. Required: 1.) Fill in the following table with your estimates of total cost and average cost per cup of coffee at the identical level of activity for a coffee stand. Round off the cost of a cup of coffee to the nearest tenth of a cent. 2.) Does the average cost per cup of coffee served increase, decrease, or remain the same at the number of cups of coffee served in a week increases? Explain Redhawk, Inc., is a merchandiser that provided the following information: Number of units sold 10,000Selling price per unit $15 Variable selling expense per unit. $2 Variable administrative expense per unit. $1 Total fixed selling expense $20,000 Total fixed administrative expense $15,000 Merchandise inventory, beginning balance $12,000 Merchandise inventory, ending balance. $22,000 Merchandise purchases $90,000Required:Prepare a traditional income statementPrepare a contribution format income statement