USCo manufactures and markets electrical components. USCo operates outside the United States through a number of CFCs, each of which is organized in a different country. These CFCs derived the following income for the current year: Determine the amount of income that USCo must report as a deemed dividend under subpart F in each scenario. (Leave no answer blank. Enter zero if applicable.)

a. F1 has gross income of $6.00 million, including $60,000 of foreign personal holding company interest and $5.94 million of gross income from the sale of inventory that F1 manufactured at a factory located within its home country.

b. F2 has gross income of $5.4 million, including $4.3 million of foreign personal holding company interest and $1.08 million of gross income from the sale of inventory that F2 manufactured at a factory located within its home country.