The following information pertains to a defined benefit pension plan that Borealis Inc. sponsors in 2020. PBO balance, January 1, 2020 $150,000
Service cost 20,000
Interest cost 13,200
Prior service cost adjustment based on past service, January 1, 2020 30,000
Amortization of prior service cost 3,000
Actuarial gain on PBO 6,000
Benefits paid to retirees 2,500
Contributions to plan 18,000

Required:
What is the PBO balance on December 31, 2020?

Varto company has 9,400 units of its sole product in inventory that it produced last year at a cost of $23 each. this year’s model is superior to last year’s, and the 9,400 units cannot be sold at last year’s regular selling price of $42 each. varto has two alternatives for these items: (1) they can be sold to a wholesaler for $8 each, or (2) they can be reworked at a cost of $251,100 and then sold for $34 each. prepare an analysis to determine whether varto should sell the products as is or rework them and then sell them.