Wright retires from the partnership of Edwards, Lee, and Wright. The partners share profits and losses in the ratio of 3:2:5, respectively. Wright’s capital balance is $32,000, and he receives $37,000...

Wright retires from the partnership of Edwards, Lee, and Wright. The partners share profits and losses in the ratio of 3:2:5, respectively. Wright’s capital balance is $32,000, and he receives $37,000 in final settlement. What is the effect on the capital accounts of Edwards and Lee?

a. Edwards’ capital decreases by $3,000.

b. Edwards’ capital decreases by $5,000.

c. Edwards’ capital increases by $3,000.

d. Lee’s capital decreases by $5,000