Required Part B (Chapter 6 6: 7) (8 marks): This new BMX bike product line will create an increase in sales of two departments: Accessories, and Parts & Service (refer to 02 segmented income statement for department information). However, due to the floor space required for retailing BMX Bikes. management estimates that sales of Mountain Bikes will decrease (hint: remember that variable costs will also change when sales change). Increase in Accessories Sales Increase in Parts & Service Sales Decrease in Mountain Bikes Sales What Is the Impact to the company's Income as a whole If the BMX product line Is added (hint: consider the segment margin of the BMX product line, and the Impact to the other product lines. Remember that If sales change for a product line, the total variable costs will also change. Thus, contribution margin should be used In your calculations for the other product lines). Increase in BMX Segment Margin $ 62,420 Increase in Contribution Margin - Accesso 8,115 Increase in Contribution Margin Parts & 7,490 Decrease in Contribution Margin - Mountain Bike howa ne ative . 5'5 S g 4.369 NET Increase (Decrease) in Operating Inco $42,446- DECISION: Should the company add the BMX bike prodEl Why or why not? Required Part C: Pricing (12 marks) Assume management has decided to go ahead with offering the BMX product line. The owners of Mountain Sports are concerned about the ability of BMX to cover Its fixed costs and provide a good return on Investment (ROI). An Investment is required for the necessary fixtures, display racks, and Inventory. The owners have provided the minimum return on Investment below. Use the cost information and unit sales provided In part A above to answer the questions below. Required investment in assets $ 201,000 Minimum return on investment