Hennigan Company
Use the Five Transactions Below for Hennigan Rentals $\quad$

question 173

Multiple Choice

Hennigan Company
Use the five transactions below for Hennigan Rentals to answer the questions that follow.
Dec. 1 $\quad$ Hennigan purchases two new saws on credit at $\$ 375$ each. The saws are added to Hennigan's rental inventory. Payment is due in 30 days.

8 $\quad$ Hennigan accepts advance deposits for tool rentals of $\$ 75$ .

15 $\quad$ Hennigan receives a bill from Farmer's Electric Company for $\$ 150$ . Payment is due in 30 days.

20 $\quad$ Customers are charged $\$ 750$ by Hennigan for tool rentals. Payment is due from the customers in 30 days.

31 $\quad$ Hennigan receives $\$ 500$ in payments from the customers that were billed for rentals on December 20.
-Refer to the transactions for Hennigan Rentals. ?
Based on the December 15 transaction,Farmer's Electric will record which of the following in its accounting records?

• A)A credit in Accounts Payable for $150
• B)A credit in Accounts Receivable for $150
• C)A debit in Accounts Payable for $150
• D)A debit in Accounts Receivable for $150

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Definitions:

Legitimate Power

A form of authority that is recognized and accepted due to the role or position held by an individual within an organization.

Manager Authority

The power vested in a managerial position to make decisions, give orders, and manage resources within an organization.

Employee Behavior

The actions and conduct of individuals within a workplace, influenced by various factors including personality, culture, and the work environment.

Zone of Indifference

A range in which attempts to influence a person will be perceived as legitimate and will be acted upon without a great deal of thought.