Homework Saved Help Save & 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 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 $ 927,000 Dirt Bikes 475,000 $ 267,000 120,000 Mountain Bikes $ 407,000 Racing Bikes $ 253,000 452,000 147,000 204,000 203,000 151,000 102,000 69,800 8,800 40,300 20,700 44,000 20,800 7,600 15,600 114,700 41,000 38,600 35,100 185,400 53,400 81,400 50,600 413,900 124,000 167,900 122,000 $ 38,100 $ 23,000 $ 35,100 $ (20,000) 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 Ch