Your new client, Henry has organized ABC Corporation, to develop and build drones to be used for commercial delivery. ABC has two office/warehouse locations - one in Montana and one in California. He has hired six engineers to help get the business model off the ground. Two of the engineers work out of the Montana office and the other four work in the Cupertino, CA office. During the year 2023, ABC is still in start-up mode, perfecting the design of the drones. ABC pays bills with the start up capital which was invested in the company. 

If ABC does not have any sales during the year (and no other gross receipts) then where do you report the net operating loss under California law? 

a. Montana 

b. California 

c. Pro rate between Montana and California using an alternative apportionment formula approved by FTB in advance. 

d. None of the above,