Restoring data into new iMac??

What's up people,
I want to sell my current iMac 20" (500gb) Aluminum b/c I want to get the 24"(1tb), I have my data backedup on a g-tech hard drive (500gb) through time machine... would I be able to just plug in the the hard drive to the new iMac and restore my apps, music,movie,& photos? Does it matter that the old mac was only 500gb? Thanks in advance.

Use Migration Assistant in Apps/Utilities on new Mac to bring across all your user data off the 20 and then your Time Machine can be set to continue with the back up scene.

I need to sell the 20" before I get the new one and im not sure if i will have a problem putting my data into the new mac...

Ok then get SuperDuper and make a bootable back up of the 20 to an ext HD and then copy it onto the new 24 when ready.

how do i do that?