Purchase price variance (PPV) and Invoice Price Variance (IPV)

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PPV is the difference between Purchase Price and Item's Standard Cost

IPV is the difference between Invoice Price and Purchase Price Standard Cost 100 PO Price 105 Invoice Price 115 PPV: 105 - 100 = 5 IPV: 115-105 = 10 Purchase Order Item's Standard Cost 100 PO Unit Price 105 PO Qty 15 PO Amount 1575 Receipt Qty Received 5 Receive Accounting  DR  CR Inventory Receiving Account/Intransit Inventory Valuation 525   Accrued Expense   525 Run Cost Manager Program Navigate to Inventory>Material Transactions Deliver Accounting  DR  CR Material Value 500   PPV (105-100)*5 25   Inventory Receiving Account/Intransit Inventory Valuation   525 Invoice Invoice Price on Matching 115 Invoice Qty on Matching 5 Invoice Amount 575 Invoice Accounting  DR  CR Accrued Expense 525   IPV (115-105)*5 50   Liability   575