While playing dominoes with a friend from college, he had the following to say about the effects of a change in actuarial estimates that resulted in an actuarial loss of $ 500,000 at the end of 2020.

1. Pension expense for 2020 will increase by $ 500,000.

2. Unless the company contributes $ 500,000 to the plan assets, it is highly probable that at the end of the accounting period the plan will be underfunded.

3. The PBO will increase by the same amount of the actuarial loss. Which of the three statements is correct?