A company's defined benefit pension plan had a PBO of $275,000 on January 1, 2018. During 2018, pension benefits paid were $48,000. The discount rate for the plan for this year was 10%. Service cost for 2018 was $88,000. Plan assets (fair value) increased during the year by $55,000. The amount of the PBO at December 31, 2018, was:

Multiple Choice

• $342,500.

• $390,500.

• $227,000.

• None of these answer choices are correct