7. Smith and Wesson's partnership has capital balances of $50,000 and $100,000 at the beginning of the fiscal vear. Smith and Wesson have no formal profit-and-loss-sharing agreement. In the first year of operations, the partnership earns $30,000 profit. Which of the following is an effect that is reported on the balance sheet? Increase Smith, Capital $15,000. A. . Increase Smith, Capital $10,000. C. D. Increase Smith, Payable $15,000. Increase Smith, Payable $10,000.