Final answer:
The total transfer price for Division Moe supplying 6,000 units to Division Shemp is $288,000; this is calculated by determining the price with the additional 20% marked up on the base price of $40.
Step-by-step explanation:
The total transfer price for the 6,000 units that Division Moe charges Division Shemp can be calculated by considering the negotiated price, which includes both the base price and the additional 20% per unit.
The base price per unit is $40, and the negotiated increase is 20% of this base price. To find the additional cost per unit due to the 20% increase, we calculate 20% of $40, which equals $8. Adding this to the base price, the new negotiated price per unit becomes $40 + $8 = $48.
With the established negotiated price of $48 per unit, we can determine the total transfer price for the 6,000 units. Multiplying the negotiated price per unit ($48) by the number of units (6,000) gives us the total transfer price. Therefore, the calculation is 6,000 units × $48 per unit = $288,000.
Hence, Division Moe charges Division Shemp a total transfer price of $288,000 for the 6,000 partially completed units, taking into account both the base price and the negotiated 20% increase per unit. This calculation ensures that the transfer price accurately reflects the agreed-upon terms and conditions between the two divisions.