Phoenix Corporation Is a Controlled Foreign Corporation (CFC)incorporated in Country

question 78

Multiple Choice

Phoenix Corporation is a controlled foreign corporation (CFC) incorporated in Country X.It is 100% owned by its U.S parent corporation.Phoenix has $80,000 of taxable income from the sale of widgets that were purchased from their U.S.parent corporation.All widgets have the same gross profit.Sixty percent of the widgets were sold through a Country Y wholesaler that is 100% owned by Phoenix,and are destined for use in Country Y.The remaining 40% are sold through unrelated Country X wholesalers and are destined for use in Country X.What amount of profits will be constructively distributed as foreign- base company sales income to the U.S.parent company?

• A)$0
• B)$32,000
• C)$48,000
• D)$80,000

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Definitions:

Plastic Molds

Custom-designed tools used in manufacturing to shape plastic materials into specific forms and dimensions.

Salesperson

A professional responsible for selling products or services to customers, often involving direct interaction or negotiation.

Professional Salesperson

An individual specialized in persuading or influencing others to purchase goods or services in exchange for money.

Prospect's Objection

Concerns or reasons given by a potential buyer for hesitating or declining to purchase a product or service.