1. USAco, a domestic corporation, is the wholly-owned U.S. subsidiary of FORco, a foreign corporation. The U.S.-Country F tax treaty exempts interest payments from withholding taxes. USAco%u2019s financial statements appear as follows:

   BALANCE SHEET

   Assets Liabilities & Owners%u2019 Equity

   Cash $100

   Receivables $500

   Notes Payable $400

   Owner%u2019s Equity $200

   INCOME STATEMENT

   Gross Income $500

   Administrative Expenses $350

   Interest Expense $100

   The interest expense of $100 arises from a notes payable from USAco to FORco.

   What is the maximum amount of interest USAco may deduct on its U.S. return?