learn-u Conten P Error Mail-Ewco Govern M Qu X a For eac Q What Studen newlea MindTa https://ezto.mheducation.com/ext/map/index.html?_con-con&external_browser=0&launchUrl=https%253A%252F%252Fn... A CH 13 HWA Saved mylabs Paraph QA key t + Help Save & Exit Submit 2 3 Check my work 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 points eBook Hint 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 Print References Net operating income (loss) Mc Graw Hill Total Dirt Bikes Mountain Bikes Racing Bikes $ 300,000 120,000 180,000 $ 90,000 27,000 63,000 $ 150,000 60,000 90,000 $ 60,000 30,000 10,000 14,000 33,000 27,000 6,000 23,000 6,000 9,000 8,000 35,000 12,000 13,000 10,000 60,000 148,000 18,000 46,000 30,000 12,000 66,000 36,000 $ 32,000 $ 17,000 $ 24,000 $ (9,000) "Allocated on the basis of sales dollars. Management is considering discontinuing the racing bikes. 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? Prev 3 of 5 Next > 1:14 AM dx O