LO.5 Your client Chips, Inc., is engaged in the cookie production business, with production plants in Florida and Singapore. The U.S. plant has always produced profits, but the Singapore operation has generated $100,000 in losses since inception. This year, the Singapore operation began producing net profits. Draft a letter to Sally Jackson, the CFO of Chips, explaining why a portion of the current-year foreign-source income must be recharacterized as U.S.-source for FTC limitation purposes. Chips’s address is 9921 East Call Street, Starke FL 32091.