Several years ago, Brian formed Sigma Corporation, a retail company ineligible for the U.S. production activities deduction. Sigma uses the accrual method of accounting. In 2015, the corporation reported the following items: Gross Profit $290,000. Long term captial gain $20,000. Tax exempt interest received $7,000. Salary paid to Brian $80,000. Payroll tax on Brian's salary (Sigma's share) $6,120. Depreciation $25,000 ($21,000 for E&P purposes). Other operationg expenses $89,000. Dividend distribution to Brian $60,000.

In addition to owning 100% of Sigma's stock, Brian merges Sigma's business and earns the $80,000 salary listed above. This salary is an ordinary and necessary business expense of the corporation and is reasonable in amount. The payroll tax on Brian's $80,000 salary is $12,240, $6,120 of which Sigma pays and deducts, and the other $6,120 of which Brian pays through Social Security withholding. Brian is single with no dependents and claims the standard deduction.

a) calculate Sigma's and Brian 2015 taxable income and total tax liability, as well as their combined tax liability. Also calcualte the corporation's current E&P after the dividend distribution.