ACCA MA Syllabus E. Standard Costing - Standard, marginal and absorption costing - Notes 2 / 3
The difference between standard, marginal and absorption costing
Standard costing systems can be either an absorption costing system or a marginal costing system.
These differ in much the same way that ordinary absorption costing and marginal costing systems differ.
Marginal costing systems focus on contribution: in a standard costing system, there is a standard contribution per unit, equal to the difference between the standard selling price and the standard variable cost.
Absorption costing systems focus on profit per unit, and the standard profit per unit of product is the difference between its standard sales price and standard full cost.