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The video tutorial explains how to break down the costs for an installation job to establish accurate pricing. It emphasizes the importance of determining the actual costs incurred, rather than marked-up prices. The presenter outlines various expenses, including torch, vacuum, nitrogen, permits, metal, fuses, disconnects, and labor. Specific examples include: torch/vacuum/nitrogen at $35, permit at $60, metal at $20, disconnect at $75, and labor for two workers at $25 per hour for 12 hours. The speaker advises to consider additional labor costs beyond what is being paid and encourages viewers to calculate their own actual costs for a more precise estimate.