1 nts The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: sales 01:54:51 Skipped Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses" Total fixed expenses Net operating income (loss) *Allocated on the basis of sales dollars. Total $ 929,000 465,000 Dirt Bikes 464,000 $ 264,000 115,000 149,000 Mountain Bikes $ 407,000 196,000 211,000 Racing Bikes $ 258,800 154,000 184,808 69,500 8,400 40,500 28,600 44,800 21,000 7,800 16,800 115,200 40,100 38,108 37,000 185,800 52,800 81,400 51,680 415,300 122,300 167,800 125,200 $ 48,700 $ 26,700 $ 43,200 $ (21,200) Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out. Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 3. Prepare a properly formatted segmented Income statement that would be more useful to management in assessing the long-run profitability of the various product lines. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes?