A company's defined benefit pension plan had a PBO of $265,000 on January 1, 2018. During 2018, pension benefits paid were $40,000. The discount rate for the plan for this year was 10%. Service cost for 2018 was $80,000. Plan assets (fair value) increased during the year by $45,000. The amount of the PBO at December 31, 2018, was:

Question

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$\begin{array}{lr}
\text { PBO } 1 / 1 & \$ 265,000 \
\text { Service cost } & 80,00 \mathrm{C} \
\text { Interest cost }(\$ 265,000 \times 10 \%) & 26,500 \
\text { Benefits paid } & (40,000) \
\hline \text { PBO } 12 / 31 & \$ 331,500 \
\end{array}$

A Company's Defined Benefit Pension Plan Had a PBO of $265,000