Check my work mode: This shows what is correct or incorrect for the work yo 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 $ 923,000 $267,000 $ 402,000 $ 254,000 460,000 117,000 191,000 152,000 463,000 150,000 211,000 102,000 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 (los) 70,000 8,600 42, 3 20,200 114,200 40,700 184,600 53,400 411,600 122,900 $ 51,400 $ 27,100 $ 40,500 20,900 7,200 15,400 38,100 35,400 B0,400 50,800 166,200 122,500 44,800 $120,500) "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. Answer is complete but not entirely correct