Step 1: Identify the process.
Dipping iron in alkaline sodium phosphate solution is a method of phosphating.
Step 2: Formation of protective coating.
In this process, iron reacts with phosphate ions to form a thin, insoluble coating of iron phosphate on the surface.
Step 3: Purpose of coating.
This film prevents direct contact of iron with moisture and oxygen, thus reducing corrosion.
Step 4: Conclusion.
Therefore it forms iron phosphate film.
Final Answer:
\[
\boxed{\text{(C) forms iron phosphate film}}
\]