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Starcups coffee company is launching a new sustainability initiative that would reward customer for purchasing a reusable cup. During the cup promotion, customers would pay
Starcups coffee company is launching a new sustainability initiative that would reward customer for purchasing a reusable cup. During the cup promotion, customers would pay an extra $1.00 for the reusable cup and would receive a 20% discount each time they return with the cup to buy a cup of coffee. Each week starcups serves 56,000 customers who purchase an average of 2.00 cups of coffee per week (112,000 cups total), starcupss contribution margin income statement for a typical week is shown below: Required: 1. Prepare a contribution margin income statement to predict how the reusable cup promotion will impact weekly net operating income. 2. Compute the difference in total revenue, total variable costs, total contribution margin, total fixed costs, and total operating before and after the promotion. 3. How will this sustainability impact the companys triple bottom line? Positive impact negative impact
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