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 Dirt Mountain Racing Total Bikes Bikes Bikes $.928,000 $266,200 $ 489, eee $ 253,000 471,200 112,000 202, eee 157,000 457. Bee 154,000 207.899 96,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line sanagers Allocated common fixed expenses Total fixed expenses Net operating incone (loss) 59,789 3,400 40,900 20,400 43,600 20,700 7.7ee 15,200 116,400 40,980 38,700 36,800 185,6ee 53,200 81,800 50,600 415,300 123,200 169, 10e 123,000 $ 41,788 $ 39,800 $37.900 (27,000) "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? Fourt Required 2 >