Choice Coffee Has Computed Their Fixed Costs to Be

question 100

Multiple Choice

Choice Coffee has computed their fixed costs to be $.20 for every cup of coffee they sell given an average daily sales level of 600 cups. They charge $1.65 per cup of coffee. The variable cost per cup is $.45. What is the contribution margin per cup of coffee sold?

• A) $.65
• B) $.90
• C) $1.00
• D) $1.20
• E) $1.65

Identify the characteristics and implications of installment notes, including interest computation and principal repayment.

Know the advantages and disadvantages of financing through bonds or long-term notes.

Understand the concept of carrying value and how it changes over the bond's life.

Grasp the tax implications of bond interest and the effect on company financial statements.

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