Accounts Payable Rate Variance. This account records variances between supplier invoice and purchase order price. If the invoice is higher, this account is debited in addition to the Purchase Order Receipts account to balance the credit to the Accounts Payable account.

Accounts Payable Usage Variance. This account records variances between the quantity on a supplier invoice and received quantity. A positive variance (invoice quantity larger than received quantity multiplied by the invoice unit price) is debited to this account to offset the higher than expected invoice amount credited to the Accounts Payable account.

Overhead Applied. This transaction applies to both purchase order and work order receipts whenever the standard cost includes overhead. When receipt transactions are made, the system credits this account and debits Inventory for the this-level overhead amount.

Purchase Order Receipts. This account records purchase order receipts before receipt of a supplier invoice. The Inventory account is debited for the GL cost of the item less any overhead amount multiplied by the quantity received. This account is credited for the purchase order price times the quantity received.

Purchase Price Variance. This account records the variance between the GL cost of an item less any overhead and the purchase order price. When a purchase order item is received, the system creates a debit to Purchase Price Variance in addition to a debit to Inventory if the PO price is higher. It does so to balance the credit to Purchase Order Receipts.