Pursco is a U.S. corporation that purchases scientific equipment for world-wide distribution and pays a tax at a 21% rate. During the current year, Pursco earns $100 million of sales, has a gross profit of $40 million, and incurs $30 million of selling, general, and administrative expenses (SG&A), for taxable income of $10 million. Pursco's sales include $20 million of sales to foreign customers. The gross profit on these foreign sales is $10 million. Pursco transferred title abroad on all these foreign sales and, therefore, the entire $10 million of gross profit is classified as foreign-source income. Pursco pays $1 million of creditable foreign taxes.

a. Compute Pursco's total foreign tax credit, as well as the amount of excess credits (or excess limitation) using gross profit as a basis for apportioning SG&A.

b. Compute Pursco's total foreign tax credit, as well as the amount of excess credits (or excess limitation) using sales as a basis for apportioning SG&A.