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: 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 (loss) "Allocated on the basis of sales dollars. Total $ 929,000 Dirt Bikes 469,000 $ 268,000 115,000 460,000 153,000 Mountain Bikes $ 408,000 199,000 209,000 Racing Bikes $ 253,000 155,000 98,000 69,800 8,400 40,500 20,900 43,600 20,500 7,400 15,700 114,900 41,000 38,800 35,100 185,800 53,600 81,600 50,600 414,100 123,500 168,300 122,300 $ 45,900 $ 29,500 $ 40,700 $ (24,300) Management is considering discontinuing the racing bikes. 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?