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When standard costing is used (managerial accounting), you will notice that the income statement (P&L) reflects two profit margins; a Standard profit margin, and Actual or Manufacturing profit margin. What is the difference between the two, where can you find them on the income statement and why the distinction? You will learn all of this in this video, including an introduction to standard costing and variance analysis.

Videos you may like:
Direct Material variances explained (Price, usage, mix, yield): https://youtu.be/elskj2JdEtw
Gross profit and gross profit margin explained: https://youtu.be/Px4pEhiTRdI
Learn sales and profitability analysis in detail here: https://youtu.be/CNx1Xu3DWVY
How calculate selling price and profits on Etsy: https://youtu.be/WsrdSr_IIhM

We look at the example income statement of a manufacturing firm (in excel), and develop an understanding of the profit margin (standard profit, manufacturing variances and actual profit). We understand how its calculated and what is the difference between the two. We also learn how manufacturing variances are calculated in a standard costing system., and where are these variances reflected on an income statement (or P&L). If you would like to learn more in detail about standard costing and variance analysis, please do leave a comment letting me know specifically what you are interested in.

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Hope you find the information in the video helpful. If you like to watch more videos in accounting, financial analysis and controller ship, videos that help you directly in doing your job, subscribe to my channel. If you liked the video, I would love if you could LIKE it and leave a comment. If you have any questions or feedback, again leave a comment. Lets stay connected at #learnaccountingfinance #profit #standardcosts