Question - On January 1, 2018, Newlin Co. has the following balances:

Projected benefit obligation $3,500,000

Fair value of plan assets 3,000,000

The settlement rate is 10%. Other data related to the pension plan for 2018 are:

Service cost $300,000

Amortization of prior service costs due to increase in benefits 100,000

Contributions 500,000

Benefits paid 225,000

Actual return on plan assets 395,000

Amortization of net gain 30,000

The balance of the projected benefit obligation at December 31, 2018 is

$4,150,000

$3,925,000

$3,900,000

$3,850,000