my won The Regal Cycle Company manufactures three types of bicycles-a dirt bike mount bike, and a racing bike. Data on sales and expenses for the past quarter follow Dirt Mountain nacin Total kes Bi bi $935,000 $267.000 489.000 $ 259,000 455,000 111,00 190,000 154.000 480,000 156,00 219, 195.000 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 8,400 41,000 20,600 43,600 20,600 7,400 15,600 115,300 40,200 38,780 36,400 187,000 53,400 81,880 51,800 415,900 122,600 168.900 124.400 $ 64,100 $ 33,400 $ 50,100 $(19,00) "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