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:

		Total		Dirt Bikes		Mountain Bikes		Racing Bikes
Sales	$	924,000	$	268,000	$	401,000	$	255,000
Variable manufacturing and selling expenses		473,000		115,000		200,000		158,000
Contribution margin		451,000		153,000		201,000		97,000
Fixed expenses:
Advertising, traceable		69,300		8,200		40,600		20,500
Depreciation of special equipment		44,200		20,700		7,800		15,700
Salaries of product-line managers		114,600		40,000		38,200		36,400
Allocated common fixed expenses*		184,800		53,600		80,200		51,000
Total fixed expenses		412,900		122,500		166,800		123,600
Net operating income (loss)	$	38,100	$	30,500	$	34,200	$	(26,600)

*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: la. What is the impact on net operating income by discontinuing racing bikes? (Decreases should be indicated by a minus sign. Total If Difference: Net Racing Bikes Operating Income Increase or Current Total Dropped (Decrease) 0 0 0 Contribution margin (loss) Fixed expenses. 0 0 0 Total fixed expenses Net operating income (loss) 0 0