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Question: Vehicle Purchase CleanWizards is a company in the business of cleaning carpets in residen- tial homes. CleanWizards has just traded in its 2014 van with a carrying value of $35,000 (original purchase price was $65,000) and has used the trade-in proceeds to purchase a new van with a cost of $75,000. The dealer valued CleanWizards' trade-in at $40,000, and thus CleanWizards paid cash of $35,000 as part of the transaction. Research whether it is appropriate for CleanWizards to record a gain on this transaction, and which accounting guidance applies to this transaction. Finally, provide the journal entries for this transaction.
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