The unadjusted balance in manufacturing overhead would be: $18,000 debit balance, underapplied
What happens when actual overhead($71,000) is greater than applied overhead($53,000)?
The excess of actual overhead over the applied overhead gives rise to underapplied overhead, since less than the actual overhead cost incurred has been factored into the units produced, in essence, we would credit prepaid expense with the $18,000($71,000-$53,000) underapplied overhead until it is paid in cash to the employees.
In the same vein, we would debit cost of goods for the additional expense, without mincing words, the correct option in this case is that $18,000 underapplied overhead is a debit balance.
Find out more about underapplied overhead on:https://brainly.com/question/13184944
#SPJ1
Find attached full question with options
