Foul Ball / Dugout situation

[iowafanseattle]

This happened in a high school baseball game:

Runners on 1st and 3rd with 1 out.

Batter hits a foul pop-up near the dugout, the dugouts are open in the front.

The catcher catches the foul ball about 4-feet before his momentum carries
him into the dugout. After he stops his momentum he immediately returns to
the field of play.

The umpire ruled: Batter out and both runners advance 1-base as the ball
went into the dugout.

Is this the correct call ?

Thanks