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 Income Net operating Income (loss) *Allocated on the basis of sales dollars. Total $ 916,000 Dirt Bikes Mountain Bikes $ 401,000 Racing Bikes $ 253,000 470,000 446,000 $ 262,000 116,000 146,000 201,000 200,000 153,000 100,000 69,500 8,900 40,500 20,100 43,400 20,300 7,900 15,200 115,900 40,500 38,900 36,500 183, 200 412,000 52,400 80,200 50,600 122,100 167,500 122,400 $ 34,000 $ 23,900 $ 32,500 $ (22,400) 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.