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) ces "Allocated on the basis of sales dollars. Total $ 923,000 473,000 Dirt Bikes $264,000 119,000 450,000 145,000 Mountain Bikes $ 408,000 202,000 206,000 Racing Bikes $ 251,000 152,000 99,000 69,700 8,500 40,500 20,700 44,200 20,800 7,900 15,500 114,100 40,900 38,200 35,000 184,600 52,800 81,600 50,200 412,600 123,000 168,200 121,400 $ 37,400 $ 22,000 $ 37,000 5 (22,400) 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 31