An LVM structure is build as follows:At the bottom is the PV (Physical Volume), which is basically just a partition (logical or not). LVM markers need to be placed on it for LVM to see it as a usable PV.

Before actual volumes can be created, a VG (Volume Group) has to be created. A group is the second lowest structure. Only one VGs can be created on per PV, but a single VG can span multiple PVs, which makes VG a very neat thing.

The final step (before the filesystem) is the LV (Logical Volume). This is the thing that will actual hold the filesystem and data. So when mkfs-ing, it will be done on this. Several LVs can occupy one VG, but unlike VG, an LV can not span VGs (so if you were to me  ...