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. Total Dirt Mountain Racing Bikes Bikes Bikes ces Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-Tine managers Allocated common fixed expenses. Total fixed expenses Net operating income (loss) "Allocated on the basis of sales dollars. $929,000 $265,000 $405,000 $259,000 472,000 113,000 203,000 156,000 457,000 152,000 202,000 103,000 69,900 8,900 43,700 20,600 40,800 20,200 7,200 15,900 114,800 40,300 38,800 35,700 185,800 414,200 53,000 81,000 51,800 122,800 167,800 123,600 $ 42,800 $ 29,200 $34,200 $(20,600) 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 atuantana /dlesduantanal nar uarter of diecontinuing the Darinn Bike? ezto.mheducation.com McGraw Hill Con... M Question 1-Ch... The Common Ap... L Start Scheduler mework i Saved k nt ences Net operating income (loss) "Allocated on the basis of sales dollars. TAT, LUU $ 42,800 $ 29,200 $ 34,200 $(20,600) Management is concerned about the continued losses shown by the racing bikes and wants a recommend the line should be discontinued. The special equipment used to produce racing bikes has no resale value a 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 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 1 Required 2 > Net operating income (loss) 4141740 222,444 407,000 123,000 $ 42,800 $ 29,200 $ 34,200 $(20,600) Book Hint *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recom the line should be discontinued. The special equipment used to produce racing bikes has no resale v 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 managem profitability of the various product lines. Complete this question by entering your answers in the tabs below. Print Required 1 Required 2 Required 3 eferences Should the production and sale of racing bikes be discontinued? Yes ONO < Required 1 Required 3> 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 a 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 run profitability of the various product lines. Contribution margin (loss) Traceable fixed expenses: Total traceable fixed expenses Product line segment margin (loss) Net operating income (loss) Totals Dirt Bikes Mountain Bikes Racing Bikes