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 dirt bikes mountain bikes racing bikes sales $ 915,000 $ 264,000 $ 401,000 $ 250,000 variable manufacturing and selling expenses 465,000 113,000 194,000 158,000 contribution margin 450,000 151,000 207,000 92,000 fixed expenses: advertising, traceable 69,400 8,200 40,600 20,600 depreciation of special equipment 44,700 20,900 7,900 15,900 salaries of product-line managers 114,400 40,300 38,900 35,200 allocated common fixed expenses* 183,000 52,800 80,200 50,000 total fixed expenses 411,500 122,200 167,600 121,700 net operating income (loss) $ 38,500 $ 28,800 $ 39,400 $ (29,700) *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.