Question 9.5: Ryan plc manufactures a control assembly for Ford Motor’s au...

Management Accounting in a Dynamic Environment

Ryan plc manufactures a control assembly for Ford Motor’s auto steering columns. Ryan uses a JIT production system. All conversion costs for the JIT line, such as direct and indirect labor, depreciation, and other overhead items, are budgeted at €8.8 million. Ryan expects to produce 2.2 million control assemblies this year. Each assembly has overhead of €4 per unit. Last week, factory labor was €38,000 and €59,000 of materials were purchased and used to produce 10,000 control assemblies. These units were shipped and billed to Ford Motor. Summarize the accounting entries for these activities.

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