I think answer should be D...


38 corporations > $100Mn income ---> 53% of taxable income from foreign sources...

60% of tax from foreign sources came from 200 returns---> these corps reported income from 10 or more countries....thise must have included few corporations with income > $100Mn (comprising 13% of taxable income from foreign sources)

a. this could be true but fails the test of must be true

b. out of scope

c. cannot be inferred

d. some corporations contributing to 60% taxable income from 10 or more foreign countries have income> $100 Mn ---> TRUE

e. 200 returns were filed to get 60% tax...and only 38 corps have income more than $100Mn ... few of these 38 were part of the 200 ---> e cannot be true....

This is a time consuming question. The first statement says that 38 corporations that showed net income of more than $100 million represented 53% of total taxable income from foreign sources, i.e. $3,800 million = 53%(total taxable income from foreign sources) ==> total taxable income from foreign sources = (3800*100)/53 = $7,170 million.

The second statement says that 60% of taxable income from foreign sources came from 200 returns reporting from 10 or more countries, i.e. returns from 10 or more countries = 60%(total taxable income from foreign sources) ==> 60%(7170) ==> $4,302, i.e. 40% of the taxable income from foreign sources came from corporations whose net income is more than $100 ==> 40%(7170) ==> $2,868.

Only option E presents a must be true scenario.

the question does not say that $3800 Mn accounted for 53% of total taxable income...If that was true then option A would have been the answer...i.e most of the income earned by corps earning $100 Mn comes from foreign source,....

question simply says that corps earning $100 Mn net accounted for 53% of total taxable income from foreign source....its possible that a certain portion of their $100 Mn income comes from foreign source....

I also will go with answer D