The Regal Cycle Company manufactures three types of bicyclesa dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow:

The Regal Cycle Company manufactures three types of bicyclesa dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Dirt Mountain Racing Total Bikes Bikes Bikes Sales $928,000 $262,000 $409,000 $ 257,000 Variable manufacturing and selling 478,000 113,000 208,000 157,000 expenses Contribution margin 450,000 149,000 201,000 100,000 Fixed expenses: Advertising, traceable 69,900 8,600 41,000 20,300 Depreciation of special equipment 43,100 20,600 7,300 15,200 Salaries of product-line managers 114,700 40,200 38,900 35,600 Allocated common fixed expenses* 185,600 52,400 81,800 51,400 Total fixed expenses 413,300 121,800 169,000 122,500 Net operating income (loss) $ 36,700 $ 27,200 $ 32,000 $(22,500) [ *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