PayPal, IPN and PHP question

[drinax]

Actually I think this is more of just a n IPN question but I hope I can get an answer here.

I found this code for IPN

   <?php
//Lets do MySql connection stuff
$mysql_host='localhost'; //Leave at localhost
$mysql_user='blah'; //DB User
$mysql_pass='blah'; //DB Pass
$mysql_db='blah'; //DB Name

//------------------------------------------------------------------
// Open log file (in append mode) and write the current time into it.
// Open the DB Connection. Open the actual database.
//-------------------------------------------------------------------
$log = fopen("ipn.log", "a");
fwrite($log, "\n\nipn - " . gmstrftime ("%b %d %Y %H:%M:%S", time()) . "\n");
$db = mysql_connect($mysql_host, $mysql_user, $mysql_pass);
mysql_select_db($mysql_db,$db);
//------------------------------------------------
// Read post from PayPal system and create reply
// starting with: 'cmd=_notify-validate'...
// then repeating all values sent - VALIDATION.
//------------------------------------------------
$postvars = array();
while (list ($key, $value) = each ($HTTP_POST_VARS)) {
$postvars[] = $key;
}
$req = 'cmd=_notify-validate';
for ($var = 0; $var < count ($postvars); $var++) {
$postvar_key = $postvars[$var];
$postvar_value = $$postvars[$var];
$req .= "&" . $postvar_key . "=" . urlencode ($postvar_value);
}
//--------------------------------------------
// Create message to post back to PayPal...
// Open a socket to the PayPal server...
//--------------------------------------------
$header .= "POST /cgi-bin/webscr HTTP/1.0\r\n";
$header .= "Content-Type: application/x-www-form-urlencoded\r\n";
$header .= "Content-Length: " . strlen ($req) . "\r\n\r\n";
$fp = fsockopen ("www.paypal.com", 80, $errno, $errstr, 30);

//---------------------------------------------
fwrite($log, "Vals: ". $invoice." ". $receiver_email." ". $item_name." ". $item_ number." ". $quantity." ". $payment_status." ". $pending_reason." ".$payment_date." ". $payment_gross." ". $payment_fee." ". $txn_id." ". $txn_type." ". $first_ name." ". $last_name." ". $address_street." ". $address_city." ". $address_state . " ".$address_zip." ". $address_country." ". $address_status." ". $payer_email. " ". $payer_status." ". $payment_type." ". $notify_version." ". $verify_sign. "\ n");

// assign posted variables to local variables
$item_name = $_POST['item_name'];
$item_number = $_POST['item_number'];
$payment_status = $_POST['payment_status'];
$payment_amount = $_POST['mc_gross'];
$payment_currency = $_POST['mc_currency'];
$txn_id = $_POST['txn_id'];
$receiver_email = $_POST['receiver_email'];
$payer_email = $_POST['payer_email'];

//----------------------------------------------------------------------
// Check HTTP connection made to PayPal OK, If not, print an error msg
//----------------------------------------------------------------------
if (!$fp) {
echo "$errstr ($errno)";
fwrite($log, "Failed to open HTTP connection!");
$res = "FAILED";
}//--------------------------------------------------------
// If connected OK, write the posted values back, then...
//--------------------------------------------------------
else {
fputs ($fp, $header . $req);
//-------------------------------------------
// ...read the results of the verification...
// If VERIFIED = continue to process the TX...
//-------------------------------------------
while (!feof($fp)) {
$res = fgets ($fp, 1024);
if (strcmp ($res, "VERIFIED") == 0) {

//--------------------------------------
// Insert Transaction details into DB.
//--------------------------------------
$qry = "INSERT into sales (
invoice, receiver_email, item_name, item_number, quantity, payment_status, pending_reason, payment_date, payment_gross, payment_fee, txn_id, txn_type, first_name, last_name, address_street, address_city, address_state, address_zip, address_country, address_status, payer_email, payer_status, payment_type, notify_version , verify_sign )
VALUES
( \"$invoice\", \"$receiver_email\", \"$item_name\", \"$item_number\", \"$quantity\", \"$payment_status\", \"$pending_reason\", \"$payment_date\", \"$payment_gross\", \"$payment_fee\", \"$txn_id\", \"$txn_type\", \"$first_name\", \"$last_name\", \"$address_street\", \"$address_city\", \"$address_state\", \"$address_zip\", \"$address_country\", \"$address_status\", \"$payer_email\", \"$payer_status \", \"$payment_type\", \"$notify_version\", \"$verify_sign\" ) ";

$result = mysql_query($qry,$db);
}
}
}
//-------------------------------------------
// Close PayPal Connection, Log File and DB.
//-------------------------------------------
fclose ($fp);
fclose ($log);
mysql_close($db);
?>

My question is this:

Where do all of the items that are inserted into my database come from? Is there a Form that I create that has some of the variables above and the others come from PayPal or are the variables coming from PayPal completely?

Thanks for your help! I may need a little more guidance depending on the answer.

Steve