The Regal Cycle Company manufactures three types of bicycles-a din 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 $933.000 $267.000 $ 409,000 $257,000 456,000 111,000 194,000 151,000 477,000 156,000 215,000 106,000 Sales Variable manufacturing and selling expenses Contribution margin Tixed expenses Advertising, traceable Depreciation of special equipment salaries of product-line managers Allocated common fixed expenses. Total fixed expenses Net operating income flows) 69,900 9,000 44,300 20,000 114,800 40.600 186,600 53,400 415,600 123,800 $ 61,400 $ 32,200 $ 40,400 20,500 7,700 15,000 38,300 35.900 82,800 51,400 169,200 123,600 46,800 (17.600) "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