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 Mountain Racing Total Bikes Bikes Bike $927,000 $269,000 $ 407,000 $ 251,000 474,000 117,000 197,000 160,000 453,000 152,000 210,000 91,000 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 (los) 70,000 8,900 40,800 20,300 43,200 20,200 7,500 15,500 115,400 40,500 38, 700 36,200 185,400 53,800 81,400 50,200 416,000 123,400 168,000 122,200 $ 39,000 S 28,600 $ 41,600 $(31,200) "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 2 > The Regal Cycle Company manufactures three types of bleycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Dirt Mountain Racing Total Bilken Bikes Bike $ 927,000 $269,000 $ 407,000 $ 251,000 474,000 112.000 197,000 160,000 453,000 152,000 210,000 91,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses! Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common tixed expenses Total fixed expenses Net operating income Loss 70,000 8,900 40,800 20,300 43,200 20,200 7.500 15,500 115,400 40.500 38,700 36,200 185,400 53,800 81,400 50,200 414000 2400 168/400 122) 200 $39.000 28.600 $ 41, 600 $1,200) "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 scontinuing the racing blkes? 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 Should the production and sale of racing bikes be discontinued Yes NO *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 o the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear ou 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-ru profitability of the various product lines. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 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. Totals Dirt Bikes Mountain Bikes Racing Bikes Contribution margin (loss) Traceable foxed expenses Total traceable fixed expenses Product line segment margin (ous) Not operating income (0) Prov