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 Dirt Mountain Racing Bikes Bikes Bikes Sales $300,000.00 $90,000.00 $150,000.00 $60,000.00 Variable manufacturing 120,000.00 27,000.00 60,000.00 33,000.00 and selling expenses Contribution margin 180,000.00 63,000.00 90,000.00 27,000.00 Fixed expenses: Advertising, traceable 30,000.00 10,000.00 14,000.00 6,000.00 Depreciation of special equipment 23,000.00 6,000.00 9,000.00 8,000.00 Salaries of product-line managers 35,000.00 12,000.00 13,000.00 10,000.00 Allocated common fixed expenses* 60,000.00 18,000.00 30,000.00 12,000.00 Total fixed expenses 148,000.00 46,000.00 66,000.00 36,000.00 Net operating income (loss) $32,000.00 $17,000.00 $24,000.00 ($9,000.00) "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