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) Mountain Bikes $ 404,000 194,000 Total Dirt Bikes $ 923,000 463,000 460,000 $ 269,000 116,000 153,000 Racing Bikes $ 250,000 153,000 210,000 97,000 69,800 8,200 40,700 20,900 43,500 20,700 7,500 15,300 113,900 40,000 38,700 35,200 184,600 53,800 411,800 122,700 30,500 167,700 50,000 121,400 $ 48,200 $30,300 $42,300 $ (24,400) "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 Complete this question by entering your answers in the tabs below. 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 food expenses Total traceable fixed expenses Product Ine segment margin (loss) Net operating income (loss) Totals Dirt Bikes Mountain Bikes Racing Bikes 0 0 D 0 0 0 0 0 0 $ 0 $ 0 $ $ Required 1 Required 2 Required 3 What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes