ded Homework Swed Help Save & E Chec The Regal Cycle Company manufactures three types of bicyclesa dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow Total $ 919,000 475,000 444,000 Dirt Bikes $262.000 116,000 146,000 Mountain Racing Bikes Bikes $400,000 $257,000 288,000 151, eee 192,000 106,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses Total fixed expenses Net operating income (loss) 70,000 44,469 115,400 183,800 413,600 8.400 20.709 40.409 52,400 121,900 $ 24.10 $ 40,900 7.889 38,800 80,000 167.5ee 24,500 20,700 15,900 36,200 51,400 124,200 $(18,200) 30.400 "Allocated on the basis of sales dollars 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? Required 2 > Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 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. Totals Dirt Bikes Mountain Bikes Racing Bikes 0 0 0 Contribution margin (loss) Traceable fixed expenses 0 0 0 Total traceable foxed expenses Product line segment margin Tolo Net operating income (loss) S