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In accounting, purchase price variance (PPV) accounts for the potential change in value of materials from when theyre purchased to when theyre recorded. Understanding PPV can help you manage a companys accountwhat is ppving process。

Related: What Is PPV in Accounting? (How to Record It in Your Books) How does budget variance analysis help with forecasting? Forecasting refers to the process of using data to predict financial performance. You can use budget to actual variance analysis to create more accurate predictions.

In this article, we answer What is PPV?, outline what causes variances in the purchase price of products and services, discuss why organisations use PPV, explain how to calculate it and review some examples.

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