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 $ 926,000 468,000 458,000 Dirt Bikes $ 263,000 114,000 149,000 Mountain Bikes $ 410,000 203,000 207,000 Racing Bikes $ 253,000 151,000 102,000 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) 69,100 43,500 114,600 185,200 412,400 $ 45,600 8,500 20,900 40,900 52,600 122,900 $ 26,100 40,400 7,400 38,600 82,000 168,400 $ 38,600 20,200 15,200 35, 100 50,600 121,100 $ (19,100) "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