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xercise 11-2 (Algo) Dropping or Retaining a Segment [LO11-2] 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: 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 quatter of discontinuing the Racing Bikes? 2. Should the production and sale of racing blkes be discontinued? 3. Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitabtity of the vatious product lines. Complete this question by entering your answers in the tabs below. What is the financial adyantage (disadvantage) per quarter of discontinuing tho Racing elkes? Exercise 11-2 (Algo) Dropping or Retaining a Segment [LO11-2] 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: 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 speclal 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. Prepore a propeffy formatted segmented income statement that would be more useful to management in assessing the long tun profitablity of the various product lines. Complete this question by entering your answers in the tabs below. Should the production and sate of racing biket be discontinued? Allocated on the basis of sales dollars. Aanagement is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not he 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 sole 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. 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