Exercise 13-2 (Algo) Dropping or Retaining a Segment [LO13-2] 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: Mauntain . . Total Dirt Bikes Bikes Racing Bikes Sales $ 919,000 $ 268,000 $ 401,000 $ 250,000 Variable manufacturing and selling expenses 467,000 112,000 197,000 158,000 Contribution margin 452,000 156,000 204,000 92,000 Fixed expenses: Advertising, traceable 69,000 8,200 40,100 20,700 Depreciation of special equipment 43,300 20,800 7,300 15,200 Salaries of productline managers 115,300 40,600 38,900 35,800 Allocated common fixed expenses* 183,800 53,600 80,200 50,000 Total fixed expenses 411,400 123,200 166,500 121,700 Net operating income (loss) $ 40,500 $ 32300 $ 337.500 $ (291700] *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 nancial 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 nancial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? Required 2 > inancial advantage (disadvantage) per quarter Exercise 13-2 (Algo) Dropping or Retaining a Segment [LO13-2] 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: MOuntain . . Total. Dirt Bikes Bikes Racing Bikes Sales 5 919,000 $ 268,000 $ 401,000 $ 250,000 Variable manufacturing and selling expenses 467,000 112,000 197,000 158,000 Contribution margin 452,000 156,000 204,000 92,000 Fixed expenses : Advertising, traceable 69,000 8,200 40,100 20,700 Depreciation of special equipment 43,300 20,800 7,300 15,200 Salaries of productline managers 115,300 40,600 38,900 35,800 Allocated common fixed expenses* 183,800 53,600 80,200 50,000 Total fixed expenses 411,400 123,200 166,500 121,700 Net operating income (loss) $ 40,500 $ 32:30\" $ 371500 $ (293001 *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 nancial 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 questlon by entering your answers in the tabs below. Required 1 Required 2 Required 3 Should the production and sale of racing bikes be discontinued? OYes .No Dashboard X Topic: Discussion Board #2 X Question 8 - Chapter 13 - Conc X Course Hero X + C ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252Fnewconnect.mheducation.com%252F#/... @ N Update Apps M Gmail YouTube Maps M McGraw-Hill Conn... econ 102 SD SDSU | WebPortal Dashboard Homework and Te... Bb Announcements -... mymathlab Reading List Chapter 13 - Concepts Overview and Exercises i Saved Help Save & Exit Submit Check my work 8 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: Mountain Total Dirt Bikes Bikes Racing Bikes Sales $ 919, 000 $ 268 , 000 $ 401, 000 $ 250, 00 points Variable manufacturing and selling expenses 467, 00 112, 000 197 ,000 158, 000 Contribution margin 452 , 000 156, 000 204, 00 92, 000 Fixed expenses: Advertising, traceable 69,000 8,200 0, 100 20 , 700 Depreciation of special equipment 43 , 300 20, 800 7 300 15 , 200 Book Salaries of product-line managers 115, 30 40 , 600 38,900 35 , 800 Allocated common fixed expenses* 183, 80 53, 600 80 , 200 50, 000 Total fixed expenses 411, 400 123, 20 166,50 121, 700 Net operating income (loss) $ 40, 600 $ 32, 800 $ 37, 500 $ (29, 700) Hint *Allocated on the basis of sales dollars. Print 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: References 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 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 Contribution margin (loss) o o Traceable fixed expenses: Total traceable fixed expenses Product line segment margin (loss) o S o S o s Net operating income (loss) Food Handlers c....pdf Show All X