disk utility showing multiple HD's

First off, have a long look at > What to do before you sell, give away, or trade in your Mac - Apple Support

Next, Erase and Reformat the Internal Drive, as per > How to erase a disk for Mac - Apple Support

After that, install the original macOS that shipped with that iMac > About macOS Recovery - Apple Support

and let the new owner set it up and upgrade using their Apple ID.

Boot into Restore Mode using CMD+r keys, then in Disk Utility's View menu choose show all devices, pick the top one on the left.