So the journal entry to record the sale will be:
Cash a/c dr. $25000
To Automobile a/c $22000
To Profit & loss a/c $3000
Automobile is sold for $25,000 cash. At the time of the sale, the book value of the automobile is its cost less accumulated depreciation or $30,000 - $8,000 = $22,000. If the automobile is sold for $25,000, there is a gain of $25,000 - $22,000 = $3,000.
A journal entry is an entry which records a business transaction in the accounting system for an organization. Journal entries generally form the building blocks of the double-entry accounting method which has been used for centuries to keep financial records.
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