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: Total $ 927, eee 462, see 465,000 Dirt Bikes $ 267, eee 118,000 149,000 Mountain Bikes $ 4e2,eee 193,000 2e9, eee Racing Bikes $ 258,00 151, eee 107,600 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 Net operating income (loss) 69, eee 43,700 114,500 185,400 412,600 $ 52,400 8,300 20,580 40,400 53,480 122,689 $ 26,400 40,600 7,798 38,100 80,400 166,809 $ 42,280 20,100 15,500 36, eee 51,600 123,200 $ (16,280) *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 1 Required 2 > Required 1 Required 2 Required 3 Prepare a properly formatted segmented income statem tement that would be more useful to management in assessing the long-run profitability of the various product lines. Totals Dirt Bikes Mountain Bikes Racing Bikes 0 0 0 0 Contribution margin (loss) Traceable fixed expenses: Total traceable fixed expenses 0 0 0 0 Product line segment margin (loss) 0 S 0 $ 0 $ 0 Net operating income (loss) $ 0