A company purchases land and a building on the land.The land is appraised at $96,000 and the building at $384,000.If the Land account is debited for $124,800,then the total purchase price for the land and building must have been

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The land is appraised at 20% of the total appraised value ($96,000 / $480,000). If the Land account is debited for $124,800, this represents 20% of the total purchase price, making the total purchase price $624,000 ($124,800 / 0.20).

A Company Purchases Land and a Building on the Land