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 Mountain Bikes Dirt Racing Bikes Bikes $923,000 $266,000 $403,000 $ 254,000 Sales Variable manufacturing and 461,000 113,000 191,000 157,000 selling expenses Contribution margin 462,000 153,000 212,000 97,000 Fixed expenses: Advertising, 68,700 8,400 40,100 20,200 traceable Depreciation of 43,600 20,500 7,300 15,800 special equipment Salaries of product-line 115,700 40,300 38,400 37,000 managers Allocated common 184,600 53,200 80,600 50,800 fixed expenses* 123,800 Total fixed expenses 412,600 122,400 166,400 Net operating income $ 49,400 $ 30,600 $ 45,600 $(26,800) (loss) *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. Required Required Required 1 2 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) Net operating income (loss) Totals Dirt Bikes Mountain Bikes Racing Bikes Complete this question by entering your answers in the tabs below. Required Required Required 1 2 3 What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? Required 2 < Required 1 Required 2 > Complete this question by entering your answers in the tabs below. Required Required Required 1 2 3 Should the production and sale of racing bikes be discontinued? Yes ONO < Required 1 Required 3 >