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The Regal Cycle Company manufactures three types of bicycles-o dirt bike, a mountain bike, and a racing bike. Dota on sales and expenses for the past quarter follow: Sales Variable manufacturing and selling expenses Contribution margin Txad expenses Advertising, traceable Depreciation of special equipment salaries of product-line Sangera Allocated common xed expenses Total fixed expenses Net operating Income (los) Hountain Racing Total nakon bikes De $300,000 $90,000 $150,000 $60,000 120 000 27,000 60,000 33,000 T80,000 90,000 27,000 30,000 10,000 14,000 6,000 23,000 6.000 9.000 8,000 35,000 12,000 13,000 10,000 60,000 18,000 30,000 12.000 100,000 46,000 66,000 30,000 $ 32,000 $17,000 $ 24,000 $ (9,000) "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? Required 2 > PEN 1 of 6 !!! Next MacBook

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