Total $ 918,000 475,000 443,000 Dirt Bikes $ 267,000 119,000 148,000 Mountain Bikes $ 400,000 199.000 201,000 Racing Bikes $ 251,000 157.000 94,000 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 (1058) *Allocated on the basis of sales dollars. 69,000 43, 700 113,700 183, 600 410.000 $ 33,000 8,300 21,000 40,100 53,400 122,800 $ 25,200 40,500 7,400 38,000 80,000 165, 900 $ 35, 100 20,200 15,300 35,600 50,200 121,300 $ (27,300) 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 Required 2 Check my work Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 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 Bike Racing Bikes 0 0 0 0 Sales Variable manufacturing and selling expenses Contribution margin (loss) Traceable fixed expenses Advertising, traceable Depreciation of special equipment Salaries of the product line managers Total traceable fixed expenses Product line segment margin (loss) (Common fixed expenses Not operating income (loss) 0 0 0 0 $ 0 $ 0 $ 0 $ 0