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The regal cycle company manufactures three types of bicycles a dirtbike a mountain bike a racing bike. Data on sales and expenses for the past quarter follow

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

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 pet Sales Variable manufacturing and selling Contribution margin Pixed Advertising, traceable Depreciation of special equipment Balaries of product-line managers Allocated common fixed expenses Total fixed awansas Het operating income (lons) Dirt Mountain Racing Total Bikes Bikes mike 6925,000 026),000 $ 404,000 $250,000 464,000 120,000 194,000 150,000 461,000 10,000 210,000 100,000 69,800 0,900 40,200 20,700 43,100 20,500 7.400 15,200 114,000 40,400 30,200 35,400 185,000 52,600 80,000 $1,800 411,00 122.400 166,600 122,900 $ 49,100 $20,600 43,400 $(14,900) "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 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. 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 Bikes Racing Bikes 0 0 0 0 Contribution margin (loss) Traceable fixed expenses: 0 0 0 0 Total traceable fixed expenses Product line segment margin (loss) 0 $ 0 $ 0 $ 0 Net operating income (loss) $ 0

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