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: Dirt Mountain Racing Total Bikes Bikes Bikes Sales $929,000 $266,000 $ 407,000 $ 256,000 Variable manufacturing and selling 477,000 116,000 210,000 151,000 expenses Contribution margin 452,000 150,000 197,000 105,000 Fixed expenses: Advertising, traceable 69,400 8,900 40,200 20,300 Depreciation of special equipment 44,700 20,900 7,800 16,000 Salaries of product-line managers 116, 100 41,000 38,300 36,800 Allocated common fixed expenses* 185,800 53,200 81,400 51,200 Total fixed expenses 416,000 124,000 167,700 124,300 Net operating income (loss) $ 36,000 $ 26,000 $ 29,300 $(19,300) *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. 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? Financial (disadvantage) per quarter