Final answer:
The oil level in a differential carrier should be exactly even with the fill hole, which provides sufficient lubrication without overfilling.
Step-by-step explanation:
When checking the oil level in a differential carrier, the oil level should be exactly even with the fill hole. This ensures that there is enough lubricant to coat the moving parts properly without overfilling, which could cause leaks and other issues.
The oil should just touch the bottom of the fill plug hole; it's acceptable if it slightly seeps out when you remove the plug. To check, you can insert a finger or a tool into the hole; the oil should be right there within reach.