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 Biken Bikes $926,000 $266,000 $ 406,000 $ 254,000 464,000 114,000 196,000 154,000 462,000 152,000 210,000 100,000 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 (loon) 69,500 8,300 40,700 20,500 43,700 20,800 7,300 15,600 115,200 41,000 38,300 35,900 185,200 53,200 81,200 50.800 413,600 123,300 167,500 122,800 $ 48,400 $ 28,700 42,500 $(22,100) ncos *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 property formatted segmented income statement that would be more useful to management in assessing the long run profitability of the various product lines