Racing Bikes Dirt Mountain Total Bikes Bikes $ 933,000 $ 409,000 $ 254,000 Sales $270,000 Variable manufacturing and selling 465,000 194,000 118,000 153,000 expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses 215,000 468,000 152,000 101,000 69,400 8,300 20,700 40,400 54,000 123,400 40,400 7,500 20,700 15,200 43,400 115,200 186,600 38,400 36,400 81,800 50,800 123,100 $ 53,400 $ 28,600 $ 46,900 $(22,100) 414,600 168,100 Net operating income (loss) *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. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? Required 2 Required 1 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. Dirt Bikes Mountain Bikes Racing Bikes Totals Contribution margin (loss) Traceable fixed expenses: Total traceable fixed expenses Product line segment margin (loss) Net operating income (loss)