If there is a debit balance in the Manufacturing Overhead account at the end of the period,overhead was underapplied.If there is a debit balance in the Manufacturing Overhead account at the end of the period,actual is greater than applied overhead,so overhead was underapplied.

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A debit balance in the Manufacturing Overhead account indicates that actual overhead costs were greater than the applied overhead costs. Therefore, if there is a debit balance at the end of the period, overhead was underapplied.

If There Is a Debit Balance in the Manufacturing Overhead