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: Mountain Total Dirt Bikes Bikes Racing Bikes Sales $ 308, 080 $ 90, 080 $ 150, 080 $ 60, 098 Variable manufacturing and selling expenses 128, 090 27,980 60, 090 33,090 Contribution margin 189,090 90, 908 27, 090 Fixed expenses: Advertising, traceable 38,080 10,890 14,090 6, 090 Depreciation of special equipment 23,080 6,080 9, 090 8,090 Salaries of product- line managers 35,980 12,090 13, 098 19, gee Allocated common fixed expenses* 60,080 18,980 30, 090 12, Gee Total fixed expenses 148,090 46,980 56,090 36,098 Net operating income (loss) $ 32,080 $ 17,980 $ 24, 090 $ (9,090) `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