On January 1, Pelican Corporation (a calendar year taxpayer) has accumulated E & P of $300,000.Its current E & P for the year is $100,000 (before considering dividend distributions).During the year, Pelican distributes $600,000 ($300,000 each) to its equal shareholders, Paul and Brian. Paul has a basis in his stock of $85,000, while Brian's basis is $150,000. What is the effect of the distribution by Pelican Corporation on Paul and Brian?