Deer, Rabbit and Squirrel are partners with equity as follows:

Capital Balances

	Deer	Rabbit	Squirrel
Capital Balances	45,000	40,000	25,000

Based on their partnership agreement, they share profit and losses equally. Squirrel is retiring and has agreed to accept $40,000 cash for his share of the partnership.

Record Squirrel's retirement from the partnership.

Select one:

a. Debit Squirrel, Capital 25,000; Debit Deer, Capital 7,500; Debit Rabbit, Capital 7,500; Credit Cash 40,000.

b. Debit Squirrel, Capital 40,000; Credit Cash 25,000; Credit Deer, Capital 7,500; Credit Rabbit, Capital 7,500.

c. Debit Squirrel, Capital 25,000; Credit Cash 25,000.

d. Debit Squirrel, Capital 15,000; Credit Cash 15,000.

e. Debit Cash 40,000; Credit Squirrel, Capital 40,000.