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 $938,000 $269,000 $410,000 $ 259,000 Variable manufacturing and 458,000 112,000 196,000 150,000 selling expenses Contribution margin 480,000 157,000 214,000 109,000 Fixed expenses: Advertising, 70,000 8,800 40,300 20,900 traceable Depreciation of special 43,300 20,400 7,500 15,400 equipment Salaries of product-line 114,400 40,200 38,800 35,400 managers Allocated common 187,600 53,800 82,000 51,800 fixed expenses* Total fixed 415,300 123,200 168,600 123,500 expenses Net operating $ 64,700 $ 33,800 $ 45,400 $ (14,500) income (loss) *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 Required Required What is the financial advantage (disadvantage) per quarter of discontinuing the racing bikes? Required 1 Required 2 > 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 Required Required Should the production and sale of racing bikes be discontinued? Yes ONO 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 Required Required 1 2 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. Totals Dirt Bikes Mountain Bikes Racing Bikes Contribution margin (loss) Traceable fixed expenses: Total traceable fixed expenses Product line segment margin (loss) Net operating income (loss)