difference between purchase price variance and invoice price
variance???
Answers were Sorted based on User's Feedback
Answer / mohammad kamal siddique
- Purchase Price Variance: Difference between purchase
order cost and standard cost, such as
P.O COST - STANDARD COST = PPV
12 - 10 = 2
- Invoice Price Variance: Difference between purchase price
and Invoice price, such as
PP - IP = IPV
12 - 10 = 2
Is This Answer Correct ? | 7 Yes | 1 No |
Answer / ibrahim mohammed
PPV = [PO UNIT PRICE - STANDARD UNIT COST] * QTY RECEIVED
IPV = [PO UNIT PRICE - INVOICE PRICE] * QTY INVOICED
Is This Answer Correct ? | 2 Yes | 1 No |
Answer / ajay
In general, Inventory records purchase price variance (PPV) and recognizes cycle count and physical inventory adjustments as variances.
Purchase Price Variance (PPV)
During a purchase order receipt, Inventory calculates purchase price variance. In general, this is the difference between what you pay the supplier and the item's standard cost. Inventory calculates this value as follows:
Inventory updates the purchase price variance account with the PPV value. If the purchase order price is in a foreign currency, Inventory converts it into the functional currency of the inventory organization and calculates the purchase price variance. Purchasing reports PPV using the Purchase Price Variance Report. You distribute this variance to the general ledger when you perform the general ledger transfer, or period close.
Invoice Price Variance (IPV)
In general, invoice price variance is the difference between the purchase price and the invoice price paid for a purchase order receipt. Purchasing reports invoice variance. Upon invoice approval, Payables automatically records Invoice Price Variance, to both invoice price variance and exchange rate variance accounts.
Cycle Count and Physical Inventory
Inventory considers cycle count and physical inventory adjustments as variance.
You distribute these variances to the general ledger when you perform the general ledger transfer or period close.
Is This Answer Correct ? | 0 Yes | 0 No |
At the time of PO receipt, how to change destination (One Inventory to Another Inventory) type ?
How is the charge account defaulted in Purchasing document(Requisition, PO)?
what is the difference between item category and item catalog can you please give examples for both
how to find customer is new or old in order management
What is the use of LC? How is it useful in export sales?
What is the use of LC? How is it useful in export sales?
What is the different between 11i and R12 in oracle ?
12 Answers Cap Gemini, Deloitte, KPIT,
Explain difference between discrete mfg and process manufacturing?
In R12 How many key attributes and other attributes are there ????
How to create sales order/purchase order for service items?
What is inter company Transaction and set ups?
WHAT ARE THE DIFF TYPES OF CALENDERS IN R12 ??? PLS EXPLAIN THEIR FEATURES ????