Answer and Analyze the problem

The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on Page 601 sales and expenses for the past quarter follow: 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. 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