10 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: 1 points Dirt Mountain Racing Total Bikes Bikes $931,000 $267,000 $406,000 $ 258,000 460,000 116,000 192,000 152,000 471,000 151,000 214,000 106,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses Advertising. traceable Depreciation of special equipment salaries of product line managers Allocated common ixed expenses Total Elxed expenses Bet operating income (lon) Book PM 69,800 8,600 40,400 20,800 44,100 21,000 7,600 15,500 115,700 40,600 38,500 36,600 186,200 53,409 21,200 51,600 415,00 123.500 167,700 124,500 $ 35,200 $ 27,400 46,300 $(18,500) "Allocated on the basis of sales dollars. Management is concerned about the continued longes 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. EXTRA CREDIT PRACTICE PROBLEMS FOR FINAL EX. 6 Saved Help 10 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. points Complete this question by entering your answers in the tabs below. B Print Required 1 References Required 2 Required What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? Required 2 > 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-ru profitability of the various product lines. 1 points eBook Complete this question by entering your answers in the tabs below. Print References Required 1 Required 2 Required 3 Should the production and sale of racing bikes be discontinued? OYes Ono Saved CREDIT PRACTICE PROBLEMS FOR FINAL EX... Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a property formatted segmented income statement that would be more useful to management in assessing the long- run profitability of the various product lines. Totals Dirt Bikes Mountain Bikes Racing Bikes Dook Print Contribution margin (loss) Traceable fixed expenses ferences Total traceable fixed expenses Product line segment margin (los) Net operating income (loss)