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 Racing Bikes Mountain Total Bikes Bikes 921,000 $264,000 $ 400,000 $ 257,000 155,000 102,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses : 475,000 114,000 150,000 206,000 446,000 194,000 traceable 69.900 43 600 8.900 40,100 20,900 Depreciati neial equipment Salaries of product-line managers Allocated common fixed expenses Total fixed expenses 20.200 16,000 40.700 115,400 38,600 80,000 36,100 51,400 184,200 52,800 413,100 122,600 166,100 124,400 $ (22,400) 32,900 27,400 $ Net operating income (loss) 27,900 *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 profitabili lines. of pro Complete this question by entering your answers in the tabs below