Job Costing is vital to the success of project-based businesses. Without proper tracking of expenses at the project level, you may never know how profitable, or unprofitable the job really was. At the surface level, job costing sounds very simple which often leads young businesses to dive in before they are truly ready. While some may not agree, we believe that job costing is something that a business needs to grow into.
When it comes to proper job costing, business owners should know that will require about 4x the standard time commitment to their books FOR THEM. If you stop and consider all the client communications involved with each job and each expense approved for the job, it is nearly impossible for an outside accountant to properly assign transactions between jobs without a lot of help.
Workflow of Creating a New Project:
Each project should begin by creating an estimate in QuickBooks Online. But before we can do that, let’s start by creating a new client and then a new project under that client.
Create a new Customer if one does not already exist.
Select Projects tab when the new customer record is displayed on the screen.
- Select New Project.
- Enter the Project name (see tip below for best naming conventions)
- Confirm the proper Customer has been selected for the project.
- Select Save.
Your new project card will open (see the image below)
Matthew's ProAdvisor Tip:
Do not create the project name with the customer name at the beginning. This is very important to ensure that the project is always selected when assigning line items and not the customer by accident. We recommend you give it a unique name as demonstrated in the video. For example, use “bathroom remodel”