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.