The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bke, and a racing bike. Data on sales and expenses for the past quarter follow: Tot ikea Sales Variable nanufacturing and sel1ing expenses ,000 115, 000 198,000 153, 000 Contribution margin Fixed expenses: s 925,000 $262,000406,000 257,000 Book 459, 000 147,000 208,000 104,000 Advertaning, traceable Depreciation of special equipment 70,5008,90040, 800 20,800 43, 400 20,400 7,600 15, 400 113,700 40,100 3,300 35,300 185,000 52,400 1,200 51, 400 412, 600 121,00 67,900122, 46,400 : 25, 20040, 100 ;(1,900) Salaries of product line managerS Allocated conmon fixed expenaes Total fixed expenses iet operating incone (oas) 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