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 $ 929,000 473,000 456,000 Dirt Bikes $ 264,000 117,000 147,000 Mountain Bikes $ 408,000 198,000 Racing Bikes $ 257,000 158,000 210,000 99,000 68,900 8,200 40,200 20,500 43,500 20,800 7,300 15,400 114,200 40,700 38,300 35,200 185,800 52,800 81,600 51,400 412,400 122,500 167,400 122,500 $ 43,600 $ 24,500 $ 42,600 $ (23,500) 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 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?