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 $930,000 Dirt Bikes $ 269,000 456,000 113,000 474,000 156,000 Mountain Bikes $ 408,000 192,000 216,000 Racing Bikes $ 253,000 151,000 102,000 70,400 9,000 40,500 20,900 44,300 20,900 7,900 15,500 115,400 40,800 38,100 36,500 186,000 53,800 81,600 50,600 416,100 124,500 168,100 123,500 $ 57,900 $ 31,500 $ 47,900 $ (21,500) 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 th. profitability of the various product lines. 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? nces Complete this question by entering your answers in the tabs below. Required 1 Required Required 3 Should the production and sale of racing bikes be discontinued? OYes ONO 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. Contribution margin (loss) Traceable fixed expenses: Total traceable fixed expenses Product line segment margin (loss) Totals Dirt Bikes Mountain Bikes Racing Bikes Net operating income (loss) < Required 2 Required 3