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Purchase Price variance

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edited Mar 24, 2019 11:04AM in Costing 1 comment

Summary

Purchase Price variance

Content

Hi,

When there is a purchase price variance, customer needs to defer this expense/profit. 

Say for an example, Standard cost price - 10 USD for an item, Purchase price - 12 USD. There is a loss of 2 USD which will be recognized in the Profit and loss account in the period which it is incurred, Can this be deferred to the period which the goods are manufactured.

Can someone advise on the PPV  and its treatment.  

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