Please answer the following questions:

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: Dirt Mountain Racing Total Bikes Bikes Bikes Sales $927,000 $267,000 $403,000 $ 257,000 Variable manufacturing and selling 475,000 112,000 208,000 155,000 expenses Contribution margin 452,000 155,000 195,000 102,000 Fixed expenses: Advertising, traceable 69,000 8,400 40,200 20,400 Depreciation of Special equipment 43,200 20,700 7,100 15,400 Salaries of product-line managers 114,900 40,400 38,400 36,100 Allocated common fixed expenses* 185,400 53,400 80,600 51,400 Total fixed expenses 412,500 122,900 166,300 123,300 Net operating income (loss) $ 39,500 $ 32,100 $ 28,700 $(21,300) *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? ::| 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: Dirt Mountain Racing Total Bikes Bikes Bikes Sales $927,000 $267,000 $403,000 $ 257,000 Variable manufacturing and selling 475,000 112,000 208,000 155,000 expenses Contribution margin 452,000 155,000 195,000 102,000 Fixed expenses: Advertising, traceable 69,000 8,400 40,200 20,400 Depreciation of special equipment 43,200 20,700 7,100 15,400 Salaries of product-line managers 114,900 40,400 38,400 36,100 Allocated common fixed expenses* 185,400 53,400 80,600 51,400 Total fixed expenses 412,500 122,900 166,300 123,300 Net operating income (loss) S 39,500 $ 32,100 $ 28,700 $(21,300) [ '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 n01 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 Should the production and sale of racing bikes be discontinued? CDYes C)No 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: Dirt Mountain Racing Total Bikes Bikes Bikes Sales $927,000 $267,000 $403,000 $ 257,000 Variable manufacturing and selling 475,000 112,000 208,000 155,000 expenses Contribution margin 452,000 155,000 195,000 102,000 Fixed expenses: Advertising, traceable 69,000 8,400 40,200 20,400 Depreciation of special equipment 43,200 20,700 7,100 15,400 Salaries of product-line managers 114,900 40,400 38,400 36,100 Allocated common fixed expenses* 185,400 53,400 80,500 51,400 Total fixed expenses 412,500 122,900 166,300 123,300 Net operating income (loss) $ 39,500 $ 32,100 $ 28,700 $(21,300) = ' \"Al|ocated 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 protability of the various product lines. Complete this question by entering your answers in the tabs below. RequrEd 3 Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long- run protability of the various product lines. Product line segment margin (loss) Net operating income (loss) _ Bed 8: Bath, a retailing company, has two departmentsHardware and Linens. The company's most recent monthly contribution format income statement follows: Department Total Hardware Linens Sales $4,320,000 $3,170,000 5 1,150,000 Variable expenses 1,334,000 923,000 411,000 Contribution margin 2,986,000 2,247,000 739,000 Fixed expenses 2,350,000 1,460,000 890,000 Net operating income (loss) $ 636,000 $ 787,000 $ (151,000) A study indicates that $372,000 of the fixed expenses being charged to Linens are sunk costs or allocated costs that will continue even ifthe Linens Department is dropped. In addition, the elimination of the Linens Department will result in a 12% decrease in the sales of the Hardware Department. Required: What is the financial advantage (disadvantage) of discontinuing the Linens Department? ::| Troy Engines, Ltd, manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy Engines, Ltd., for a cost of $30 per unit. To evaluate this offer, Troy Engines, Ltd., has gathered the following information relating to its own cost of producing the carburetor internally: 13,000 Units Per Per Unit Year Direct materials $ 13 $ 169,000 Direct labor 9 117,000 Variable manufacturing overhead 3 39,000 Fixed manufacturing overhead, traceable 3* 39,000 Fixed manufacturing overhead, allocated _6 78,000 Total cost $ 34 $ 442,000 l *One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value). Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the nancial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? ::| Troy Engines, Ltd., manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy Engines, Ltd., for a cost of $30 per unit. To evaluate this offer, Troy Engines, Ltd., has gathered the following information relating to its own cost of producing the carburetor internally: 13,000 Units Per Per Unit Year Direct materials $ 13 $ 169,000 Direct labor 9 117,000 Variable manufacturing overhead 3 39,000 Fixed manufacturing overhead, traceable 3* 39,000 Fixed manufacturing overhead, allocated 6 78,000 Total cost at 34 $ 442,000 l *One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value). Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 2' Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Troy Engines, Ltd., manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy Engines, Ltd., for a cost of $30 per unit. To evaluate this offer, Troy Engines, Ltd., has gathered the following information relating to its own cost of producing the carburetor internally: 13 , 000 Units Per Per Unit Year Direct materials $ 13 $ 169,000 Direct labor 9 1 17 , 000 Variable manufacturing overhead 3 39 , 000 Fixed manufacturing overhead, traceable 3* 39,000 Fixed manufacturing overhead, allocated _6 78,000 Total cost $ 34 $ 442,000 l *One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value). Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? Troy Engines, Ltd., manufactures a variety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy Engines, Ltd., for a cost of $30 per unit. To evaluate this offer, Troy Engines, Ltd., has gathered the following information relating to its own cost of producing the carburetor internally: 13,000 Units Per Per Unit Year Direct materials $ 13 $ 169,000 Direct labor 9 117,000 Variable manufacturing overhead 3 39,000 Fixed manufacturing overhead, traceable 3* 39,000 Fixed manufacturing overhead, allocated 6 78,000 Total cost $ 34 $ 442,000 I *One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value). Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted? 3. Suppose that if the carburetors were purchased, Troy Engines, Ltd., could use the freed capacity to launch a new product. The segment margin of the new product would be $130,000 per year. Given this new assumption, what would be the financial advantage (disadvantage) of buying 13,000 carburetors from the outside supplier? 4. Given the new assumption in requirement 3, should the outside supplier's offer be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Given the new assumption in requirement 3, should the outside supplier's offer be accepted? CDYes CDNO