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 $ 915,000 $262,200 $ 402,800 $ 251,000 480, eee 115,000 207,000 158, eee 435,000 147,080 195,000 93,000 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) 7e, eee 8,400 40,700 20,900 43,900 20,200 7,900 15,800 115,482 40,800 38,800 35,800 183,000 52,400 89, 4ee 50,200 412,300 121,800 167,800 122,700 $ 22,700 $ 25,200 $ 27,200 $(29,700) "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? *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a rec the line should be discontinued. The special equipment used to produce racing bikes has no resa 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 manag profitability of the various product lines. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required Should the production and sale of racing bikes be discontinued? Yes No Required 1 Required 2 Required 3 Prepare a properly formatted segmented income statement that would be more useful to management in assessing the run profitability of the various product lines. Totals Dirt Bikes Mountain Bikes Racing Bikes Contribution margin (loss) Traceable fixed expenses: Total traceable foced expenses Product line segment margin (loss) Net operating income (loss)