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 $ 935,000 471,000 464,000 Dirt Bikes $ 269,000 120,000 149,000 Mountain Bikes $ 406,000 201,000 205,000 Racing Bikes $ 260,000 150,000 110,000 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) 70,100 42,900 116,100 187,000 416, 100 $ 47,900 8,700 20,300 40,900 53,800 123,700 $ 25, 300 41,000 7,200 38,200 81,200 167,600 $ 37,400 20,400 15,400 37,000 52,000 124,800 $ (14,800) *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