Elgin Company's budgeted fixed factory overhead costs are $50,000 per month plus a variable factory overhead rate of $4.00 per direct labor hour. The standard direct labor hours allowed for October production were 20,000. An analysis of the factory overhead indicates that in October, Elgin had an unfavorable flexible-budget variance of $1,500 and a favorable production-volume variance of $500. Elgin uses a two-variance analysis of overhead variances.
The applied factory overhead in October is:
a. $129,500.
b. $128,000.
c. $130,000.
d. $130,500.