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computing CTI under the facts before us. The term CTI, and the
method for computing such, for purposes relevant here, however,
is defined in Q&A-12. General language of a statutory provision
will not be held to apply to a matter specifically dealt with in
another part of the same enactment; specific terms prevail over
the general. D. Ginsberg & Sons, Inc. v. Popkin, 285 U.S. at
208; Dupree v. United States, 391 F.2d 753, 758 (5th Cir. 1968).
Under the profit-split method, the electing corporation's
taxable income derived from products produced in a possession
equals 50 percent of the combined taxable income of the
affiliated group derived from covered sales of these products.
Sec. 936(h)(5)(C)(ii)(II). Combined taxable income is the gross
income of the affiliated group derived from covered sales of the
possession product less all expenses properly apportioned and
allocated to such income.
Q&A-1 describes the proper allocation and apportionment of
expenses in computing CTI with respect to soft-drink concentrate
produced by CRI and sold by U.S. affiliates in unchanged form to
unrelated bottlers. If, however, the possession product is
simply a component of a final product, then Q&A-12 prescribes the
manner of computing CTI.
Q&A-12 prescribes the method for determining CTI with
respect to component products. Under that method, the expenses
which the affiliated group allocated and apportioned to the
integrated product, i.e., syrup and soft drink, must be further
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