When I meet with new clients and we’re discussing what’s working, what’s not, we often discuss what would you like to see in your job cost reports besides you making a healthy profit ;-)? Generally you want to see revenue, cost of good (labor, materials, subs,) and perhaps others.
What I often see is the job costing in the chart of accounts, but the key to successful job cost reporting in QuickBooks is all in the Items. The intent is for you to use your Items for the detail of the job and your Chart of Accounts for the bigger picture.
If you’ve had a few changes in your accounting/bookkeeping staff, chances are your Items list has been revised multiple times. In fact, it’s often like a pendulum, from almost no detail to a lot of detail and perhaps settling somewhere in between. There’s no right or wrong as to number of Items or which Items you need to have.
So start with what’s important for you to see in your job cost reports. Some might be dictated by profession, regulations, or customer, but there’s still quite a bit of leeway for most contractors. And I’m asking you the owner or perhaps project manager, not the bookkeeper. Your bookkeeper can set it up, but what to see should come from those reviewing the reports. How much detail do you want or need? I can talk to 3 different companies, al in the same industry, and they don’t want the same level of detail – that’s okay.
If you’re a general contractor, you may be using the AIA codes with sub-Items for more detail. Some remodelers might use labor, subs, lumber, drywall, paint, etc. Landscapers might use maintenance, hardscape, mowing, pruning, cement, trees, annuals, shrubs, plant material, lighting, plowing, etc.
It gets back to what you want to see. Do you want to see hardscape or do you want some detail (like labor, type of paver, cement)? Do you just want plant material or do you want more detail? If you’re remodeling, do you want to see exterior paint vs interior paint, or appliances vs specific appliances or wallpaper, or type of lumber?
Do you need to track Work in Process so some Items need to hit the balance sheet instead of your P & L until the project is done?
Forget what you currently have momentarily and jot down what you’d like and/or need to see. Then compare to what you have and see what you end up deciding.
If you want help with this, or your bookkeeper needs assistance, let us know.