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. 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) "Allocated on the basis of sales dollars. Total $ 915,000 479,000 Dirt Bikes 436,000 $ 262,000 116,000 146,000 Mountain Bikes $ 403,000 210,000 Racing Bikes $ 250,000 153,000 193,000 97,000 68,800 8,100 40,600 20,100 43,700 20,900 7,200 15,600 115,800 40,500 38,700 36,600 183,000 52,400 80,600 50,000 411,300 121,900 167,100 122,300 $ 24,700 $ 24,100 $ 25,900 $ (25,300) 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? Financial advantage (disadvantage) per quarter