FORco, a foreign corporation incorporated in foreign

FORco, a foreign corporation incorporated in foreign country F, manufactures and sells figure skates. FORco owns a U.S. C corporation (“USSub”) that distributes only FORco’s figure skates. USSub uses the comparable profits method to show the arm’s length nature of its transfer pricing. USSub can choose comparable companies from the following list of potentially comparable companies.

All Berry Ratios are an average of gross profit over operating expense for the last three years.

• -Shelter Inc.: A distributor of camping tents. Berry Ratio = 2.00.
• -Cash Cow Inc.: A distributor of electronic knives. The company’s sales are split 50-50 between the United States and India. Berry Ratio = 1.50.
• -Disk Inc.: A distributor of computer equipment manufactured by its Hong Kong affiliate. Berry Ratio = 1.20.
• -Floss Inc.: A distributor of dental care products. Floss has a contractor use Floss’s proprietary manufacturing process to manufacture all the products Floss distributes. The contractor affixes the valuable Floss tradename to all the products it manufactures. Floss retains the right to all intellectual property. Berry Ratio = 1.10.
• -Acme Inc.: A sporting goods distributor. Berry Ratio = 1.05.
• -Mountain Top Inc.: A distributor of hiking gear. Berry Ratio = 1.15.
• -Juice Inc.: A distributor of juicers. Berry Ratio = 1.20.
• -Canine Inc.: A distributor of pet toys. Berry Ratio = 1.00.
• Required

What is the arm’s length range? Why?