Exercise 12-2 Dropping or Retaining a Segment [L012-2] 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 Bikes Total Bikes Bikes $931,000 $266,000 406,000 259,000 157,000 Sales Variable manufacturing and selling 469,000 115,000 197,000 expenses Contribution margin Fixed expenses: 462,000 151,000 209,000 102,000 Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* 20,600 15,600 35,500 51,800 123,500 $47,900 28,100 41,300 $ (21,500) 40,300 7,200 39,000 81,200 414,100 122,900 167,700 69,900 9,000 43,200 20,400 114,800 40,300 53,200 186,200 Total fixed expenses Net operating income (loss)