Order Price Quantity Variances

Definition

The unit in which a material is priced in a purchase order is called the purchase order price unit.

Example Example

You order 100 pieces of a material at $20 per kg. In this case, "piece" is the purchase order unit (OUn), and "kg" (kilogram) is the order price unit (OPUn). With this type of purchase order, the ratio between piece and kilogram must also be entered so that the system can convert quantities of one unit of measure into the other, for example, four pieces equal 10 kg.

End of the example.

A variance in order price quantity occurs in the following cases:

  • Invoice receipt after goods receipt

Ratio (Invoice quantity in OPUn) : (Invoice quantity in OUn) is different to the ratio (Goods receipt quantity in OPUn) : (Goods receipt quantity in OUn) .

  • Invoice receipt before goods receipt

Ratio (Invoice quantity in OPUn) : (Invoice quantity in OUn) is different to the ratio (Order quantity in OPUn) : (Order quantity in OUn) .

See also:

Posting Order Price Quantity Variances