Special equipment: Pastry brush Pastry bag or resealable plastic bags with 1 corner snipped Small star tip (#13 or similar) 12 red, yellow and or polka dot cupcake liners 12 pieces colored construction paper, cut into small triangular shapes, for flags Rubber cement 12 extra-long toothpicks
Preheat oven to 350 degrees F. Line 2 (12 cup) muffin tins with white paper liners.
Make the cake mix according to package instructions, substituting the milk for water. Pour the batter into the lined muffin tins and bake until golden and a toothpick inserted in the center comes out clean, about 12 to15 minutes. Remove the tins from the oven and let them cool completely on a wire rack.
In a large bowl, using a hand mixer, beat the frosting with enough confectioners' sugar to create a stiff consistency. Remove about 1/2 cup of the frosting and color it with either red or yellow food coloring. Put the frosting into a pastry bag or resealable plastic bag fitted with a small star tip.
When the cupcakes are cool, frost the top of 12 cupcakes with an offset spatula. (Reserve the remaining cupcakes for a centerpiece or frost if you have more guests). Put each cupcake into a red or yellow liner. The liners will not fit snugly but will resemble a frilly clown's collar.
To decorate: Write the name for each guest on colored flags. Using a small amount of rubber cement fold 1 edge over the top of the toothpick to attach. Using a serrated knife cut about 1 1/2-inches off the bottom of the sugar cones. Using pastry brush, coat each lightly with piping gel. Roll 6 cupcakes in yellow sanding sugar and the other 6 in the red. Firmly but gently insert the flag into the top of each cone. Put the cones slightly towards the back of each cupcake. Snip the licorice into 12 (2-inch) pieces for mouths, and approximately 120 (1- pieces) for hair. A clean pair of tweezers is helpful for attaching the hair along the base of the sugar cone. Add a gumball to each for a nose and either 2 brown or blue candy coated chocolates for eyes. Pipe small stars with colored frosting along the base of the cones and hair and along the base near the top of the liner.
For extra cupcakes: Divide some white frosting into 2 small bowls and color 1 with red coloring and 1 with yellow. Fit 2 pastry bags with a star tip and fill each with 1 color of the frosting. Pipe a swirl of red frosting onto 6 cupcakes and a swirl of yellow on the remaining cupcakes. Sprinkle each cupcake with nonpareil sprinkles.
Arrange all of the cupcakes on a cupcake stand and serve.