Orleans Corporation,a U.S.corporation,manufactures boating equipment.Orleans reported sales from this product group of $200 million,of which $80 million were foreign source sales.The gross profit percentage for domestic sales was 20%,and the gross profit percentage from foreign sales was 10%.Orleans incurred R&E expenses of $15 million,all of which were conducted in the United States.What is the minimum amount of the R&E expense that can be apportioned to foreign source gross income for foreign tax credit purposes,assuming the company can elect either apportionment method?

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The Answer of Orleans Corporation,a U.S.corporation,manufactures boating equipment.Orleans reported sales from this product group of $200 million,of which $80 million were foreign source sales.The gross profit percentage for domestic sales was 20%,and the gross profit percentage from foreign sales was 10%.Orleans incurred R&E expenses of $15 million,all of which were conducted in the United States.What is the minimum amount of the R&E expense that can be apportioned to foreign source gross income for foreign tax credit purposes,assuming the company can elect either apportionment method?