Each Friday, here on the QuickBooks for Contractors blog, we will be offering a free QuickBooks related eBook, offering tips, tricks, and training – so stayed tuned, visit often or sign up to have our posts delivered daily via email.
This week’s eBook provides information and tips for setting up a system to track Subcontractors Workers Compensation and General Liability Insurance expiration dates.
When a contractor works on a construction project and he/she hires subcontractors; one of the things that he is required to keep on file is a CURRENT copy of each subcontractors Worker’s Compensation Insurance Policy and a copy of their General Liability Insurance.
Keeping track of expiration dates and making sure that you always have a copy of the current policy on hand, can be a daunting task.
Each Friday, here on the QuickBooks for Contractors blog, we will be offering a free QuickBooks related eBook, offering tips, tricks, and training – so stayed tuned, visit often or sign up to have our posts delivered daily via email.
This week’s eBook provides information on paying and tracking prevailing wage fringe benefits, when you work on a government funded construction project that requires the submission of certified payroll reports. Tracking fringes gets quite complicated, as they can be:
- paid to a Union on behalf of the employee
- paid to a bona-fide fringe benefit plan on behalf of the employee
- paid in cash to the employee
- or, a portion of the total hourly fringe benefit amount can be split between payments to a bona-fide plan with the balance in cash to the employee
Request our FREE 27 page eBook – 4 Ways Contractors Pay Prevailing Wage Fringe Benefits
Change Orders are a fact of life that a contractor must deal with on just about every construction project that they are involved with.
Construction contracts start with an original bid amount for specific cost codes, phases of work, or line items. However, most construction contracts change as work proceeds; resulting in both increases and decreases or positive and negative change orders – which affect the original bid amount.
There are many ways in which people will handle Change Orders when using QuickBooks, such as just going to the original Estimate and changing the dollar amounts of the affected items. This is a “quick and easy fix”; however, it doesn’t leave a good documentation trail for what occurred on the project and can cause a lot of confusion.
Handling change orders that increase the value of the contract can be accomplished by:
- Editing the original Estimate and ADDING lines to the bottom indicating the cost codes and dollar amounts that are causing the increase.
- Creating a Sub-Job of the Job called Change Order 1 (2, 3, 4, ect.) and creating an estimate at the Sub-Job level to track just the cost codes involved in the change order.
Dealing with Negative Change Orders that reduce the original bid amount, is a bit more difficult – because QuickBooks will not allow you to create a Negative Invoice.
When you receive a negative change order that is LESS than the remaining balance on the contract, it’s a fairly easy process.
- Go to your QuickBooks Estimate, add a Change Order Item with no dollar amount – this provides a clear separation of the Original Contract amount.
- Below that add the Item that represents the reduction to the contract, enter the value as a negative amount, complete with the MINUS sign.
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When you are ready to prepare your next progress invoice:
- Bill the negative amount at 100%.
- Reduce the corresponding line item in the original contract section.
- Bill for any other line items that you need to.
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Or simply generate a zero dollar invoice to record the reduction.
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This method allows for a good documentation trail that everyone involved can easily see.
Welcome to the launch of “Freebie Friday’s” here on the #QuickBooks for Contractors blog.
Each Friday we will be offering a free QuickBooks related eBook, offering tips, tricks, and training – so stayed tuned, visit often or sign up to have our posts delivered daily via email.
To start off our Freebie Friday’s eBook give away, we are offering an 18-page eBook called Payroll Mistakes – It’s Not As Easy as 1-2-3 ; it seemed appropriate since year end payroll is just around the corner. After all, payroll is an essential part of your business – not just a weekly, bi-weekly, or monthly annoyance. Payroll is the primary way that employees are rewarded for good job performance and retained. If you are issuing late or incorrect paychecks it can lead to dissatisfied, unmotivated workers – or worse. It’s hard to keep good employees when a company gets payroll wrong.
FREE Payroll Mistakes eBook:
Learn common mistakes that occur during the hiring process, paycheck generation, at year end, and all year long. Request our FREE 18 page eBook; Payroll Mistakes – It’s NOT As Easy As 1-2-3, which expands on common mistakes and learn how to avoid them.
