Engingeering wants to buy a new tractor by trading in its current tractor, which is the same model but several yrs older. The new tractor has a list price of $219,700. The old tractor was orginially purchased for $177,200, but has a current book value of $38,900.
The tractor dealer has offered a trade-in allowance of $38300 for the old tractor. Journalize the transactions required to properly dispose of the tractor.