The Regal Cycle Company manufactures three types of bicyclesa 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 Bikes $ 918,000 $263,000 $402,000 $ 253,000 474,000 117,000 207.000 150,000 444,000 146.000 195,000 103,00 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) 70,000 8,100 40,900 21,000 44,400 20.600 7,900 15,900 114,800 40,000 38,900 35,990 183,60e 52,600 80,400 50.600 412,800 121,380 168,100 123,400 31,200 $ 24,7005 26,900 $(20,400) *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