Many QuickBooks forms have a billable column, do you know what it’s used for and are you using it correctly?
Many QuickBooks forms have a billable column available for you to work with – checks, enter bills, timesheets, enter credit card charges, etc. The purpose of the billable column is to allow you to choose which expenses and/or time entries that you will be passing through to customers when you create an Invoice based on Time & Costs {also know as Time & Materials billings or Cost Plus billing in the construction industry.}
Welcome to Tuesday Training!
Tuesday Training is a new feature here on the QuickBooks for Contractors blog. While everyday focuses on training of one sort or another, Tuesday’s are dedicated to more in-depth training.
We’ll teach you the things you need to know about using QuickBooks, that you won’t find in the QuickBooks Help file, in order to successfully run your construction business and obtain accurate job costing reports; from eBooks, live webinars, and recorded training sessions.
You’ll find high-quality (budget friendly) training without having to leave the comfort of your home or office.
Important Facts About Items Left as Billable
Are you aware that if click into the billable column, which places a checkmark in the column {OR you leave that little Invoice icon found on many forms active and don’t “X” it out older versions of QuickBooks} that the information relating to that transaction line is stored within your QuickBooks file in a “waiting to be billed” status just taking up additional space and making your file larger than normal?
Selecting the billable column doesn’t mean that you want the costs assigned to this job {which is a common thought or assumption} but rather it tells QuickBooks that you want to take the information about that transaction and put it into a temporary database until you create an invoice for a specific customer using the Time/Costs button on the Invoice form.
If you really don’t pass these costs or time entries onto customers using the Time/Costs feature of QuickBooks – then this temporary database is just out there growing and growing – which causes the overall size of your QuickBooks file to become bigger and bigger.
If you are wondering if this is happening to you, an easy way to find out it to run an “Unbilled Costs by Job Report” {Report menu -> Jobs, Time & Mileage -> Unbilled Costs by Job} and look to see if there are a lot of entries in this report, if there are; all of those entries are just sitting there waiting for you to do something with them.
Download our 2 page article for instructions on how to clear out old unbilled costs – without having to edit each item in the report and manually making them unbillable.
We hope that you’ve found today’s Tuesday Training article to be helpful to your business – if so please take a moment to leave a comment or share this with others on your favorite social media network using the buttons below.
So how do you find a “good” bookkeeper and test their knowledge before hiring them? Or, perhaps you are ready to hire a CPA to help you with your business and your books. Congratulations! We all know what a struggle it is to “try to do everything” yourself, and it almost goes without saying that as a busy contractor, we also know that time is best spent on the job and not in the office handling paperwork.
Welcome to Tuesday Training!
Tuesday Training is a new feature here on the QuickBooks for Contractors blog. While everyday focuses on training of one sort or another, Tuesday’s are dedicated to more in-depth training.
We’ll teach you the things you need to know about using QuickBooks, that you won’t find in the QuickBooks Help file, in order to successfully run your construction business and obtain accurate job costing reports; from eBooks, live webinars, and recorded training sessions.
You’ll find high-quality (budget friendly) training without having to leave the comfort of your home or office.
Construction Bookkeeper Test – $25.00
So how do you find a “good” bookkeeper and test their knowledge before hiring them? Well, we have scoured the internet searching for a “good” QuickBooks and Construction Bookkeeping Test, and while we have found some that would test an applicant’s basic knowledge of QuickBooks as well as some basic accounting knowledge, none have addressed any construction related functions. Being disappointed in what we have found, we’ve designed our own – somewhat based on issues that we deal with on a day to day basis supporting our own software which integrates with QuickBooks – and we are happy to offer you a copy {complete with the answers}.
Our Bookkeepers test asks applicants to answer a total of 145 questions, covering 5 different areas of knowledge.
Purchase your copy today for $25.00.
Hiring a Bookkeeper or CPA
We all know what a struggle it is to “try to do everything” yourself, and it almost goes without saying that as a busy contractor, we also know that time is best spent on the job and not in the office handling paperwork.
Before you hire someone to handle your books or your taxes, check their skills and lay the ground rules to make sure that you are getting the right person for your business and never make the big mistake of just “turning” it all over to someone (no matter how enticing that idea may be). Always keep an eye on what is going on.
FREE eBook – click here to download.
Additional Resources from the IRS
Even the IRS feels that this is an important subject, and the IRS urges you to choose that preparer wisely. Most return preparers are professional, honest and provide excellent service to their clients. But it is the taxpayer who is legally responsible for what’s on his or her tax return even if it is prepared by someone else.
We hope that you’ve found today’s Tuesday Training items to be helpful to your business – if so please take a moment to leave a comment or share this with others on your favorite social media network using the buttons below.
Knowing how to complete an AIA G-702/G-703 billing form and documenting change orders are important for your overall cash flow, if they aren’t done correctly – well you don’t get paid on time! This Tuesday Training segment will provide you with detailed information on both
Welcome to Tuesday Training!
Tuesday Training is a new feature here on the QuickBooks for Contractors blog. While everyday focuses on training of one sort or another, Tuesday’s are dedicated to more in-depth training.
We’ll teach you the things you need to know about using QuickBooks, that you won’t find in the QuickBooks Help file, in order to successfully run your construction business and obtain accurate job costing reports; from eBooks, live webinars, and recorded training sessions.
You’ll find high-quality (budget friendly) training without having to leave the comfort of your home or office.
AIA G-702/G-703 Training Exercise – $25.00
Most anyone will tell you that completing the AIA G-702 and G-703 forms by hand is frustrating and difficult. To fill out one correctly, you pretty much have to:
- forget about any basic accounting principals you’ve ever learned
- ignore change orders that have been submitted or approved, but not processed
- ignore money that is still outstanding from previously submitted applications for payment
You need to realize that the payment applications that you submit are an important piece of your overall cash flow management. When your payment applications get screwed up — bad things happen; none of which put you in “good standing” with the General Contractor or Project Owner, and can ultimately damage your company’s overall cash position.
This 38 page eBook contains everything you’ll need to learn how to complete these billing forms correctly; including a sample AIA training exercise that walks you through, from start to finish, how to complete an AIA G-702 & G-703 form by hand.
Purchase your copy today for $25.00.
Documenting Change Orders, Extra Work Orders & Job Costs
It almost goes without saying that on any construction project, a contractor’s ability to get paid for the Original contract, Extra Work Orders and/or Change Orders is vital to the business’s profit margin.
It’s the start of a new contruction season, is your job costing system in place?
Free eBook – click here to download.
If you use QuickBooks for your accounting and you create your Estimates in Excel instead of within QuickBooks you loose out on job costing capabilities and so much more!
I often see and hear comments such as this as I browse the web or talk with potential customers for our software:
Right now we are using QuickBooks Contractor. It is ok for our accounting software but we are looking for something that works as an overall system for our office – CRM, estimating, job costing, proposals, work tickets and most importantly easy for my guys to use. Right now we are using Excel for Estimates and invoices.
When I see and hear comments like this I get so confused – because QuickBooks does allow you to create Estimates, Proposals, and do Job Costing - so I thought I’d attempt to write a short article to address this.
Creating Estimates in Excel vs. QuickBooks – Pros and Cons:
Excel is REALLY easy to use – anyone can quickly whip up an Estimate, Proposal or a Work Order., you can create some great looking documents that you are proud to hand to your prospective customer. But that is about as far as you can go.
QuickBooks, on the other hand, if set up properly will allow you to create an Estimate, Proposal, Work Order, or an Invoice and perform job costing just by entering vendor bills, writing checks, entering credit card charges, and employee payroll. You then can access all kinds of Job Costing reports and an Actual vs. Estimate Report – which allows you to see the difference between what you thought you’d make on the job vs. what you actually made.
But….QuickBooks requires more work on the front end and then proper training for your employees.
I think I just heard everyone groan! There is no way that I can write a “short” article on the benefits of using QuickBooks to prepare these documents for your business, but I can provide you with some suggestions to get started.
- Is the QuickBooks Estimate function turned on? If not go to the Edit menu -> Preferences -> Jobs & Estimates -> Company Preferences tab -> set “Do You Create Estimates” AND “Do You Do Progress Invoicing” to Yes
- Modify/Customize the built in forms to meet the needs of your company using the Layout Designer, by downloading a pre-built template or by using the Create Form Design option. All of these options are available from the Lists menu -> Templates -> and then clicking the Template button at the bottom of the window.
- Create a FULL list of the services, cost codes and/or products your company uses for billing
- Have a meeting – get EVERYONE involved – take that master list of products and/or services/cost codes and come up with descriptions that EVERYONE can agree on {letting them know that they can “tweak” it more to their liking later}
- Go to the Items List and set up items that correspond to that master list of of the things your company does, creating Group Items or Inventory Assemblies if appropriate
- Create an Estimate, a Proposal, or a Work Order using the entries in your Item List – print it out and see what everyone things of it. If they are happy teach your Estimators how to use the Estimating function
- When entering Vendor bills, writing checks, or entering Credit Card Charges use the Items tab and assign the cost to the job
- Turn on time tracking, enter employee hours by Job, Service Item, and Payroll Item
- Create a Progress Invoice from an Estimate for the current amount that you are billing the customer
- Look at the Estimate vs Actual Report for a specific job and look at the report results
These suggestions are just the tip of the iceburg for taking QuickBooks from plain-Jane accounting to job-costing accounting. Use the search box on our site and enter specific keywords for additional tips.
If you can’t get your Estimators to leave Excel, there is a 3rd party application Transaction Pro Importer – that will import your Excel based Estimate into QuickBooks for you and you can implement some of the other suggestions in this article.
I hope you’ve found this article to be helpful, if so please take a moment to leave a comment or ask a question – or share it on your favorite social networking site if you think others would find it to be useful.
Payroll can be one of the most complex duties of any bookkeeper’s job – especially when you need to OR want to track your Worker’s Compensation costs for job costing purposes and pay your employees Vacation, Holiday and Overtime wages. Just take a look at this question, submitted by one of our blog subscribers!
I have set up the Workers Compensation tracking in QuickBooks for a construction company with no problem, it seems to be working fine. My question is – how do you keep track of Holiday, Vacation, and Overtime pay? Do I set up each payroll item with the Workers Comp {WC} rate for each class? For example Carpenter-Holiday and Carpenter-Vacation? Thanks, Kathleen
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Answer:
Hi Kathleen;
That’s an excellent question!
One of the first things that you should do is contact your Worker’s Compensation Insurance carrier and ask them if there is a reduced Worker’s Comp rate for when you pay your field workers for non-field related time such as Vacation or Holiday pay. I once asked this question of the Insurance underwriter and much to my surprise he told me {grudgingly} that Vacation and Holiday pay for field employees was computed at a lower experience rate than their normal wages; mainly because there was “no risk” involved for those wages – he quickly followed this up with “but this will involve more tracking on your part” for the annual audit/review.
The QuickBooks payroll module is pretty darn flexible; but like the rest of the program it’s generic – so sometimes it’s a little “lacking” when it comes to some specific things like the situation above.
Even if I didn’t fall into the special situation of a reduced WC Experience Rate for Holiday and Vacation time, I would still create specific payroll items based on Work Classification/type of wage: so Carpenter-Holiday or Carpenter-Vacation would be the way I would go.
Overtime can get tricky, especially if your contractor client works on prevailing wage jobs and pays the fringe benefit portion of the prevailing wage in cash to the employee as part of the hourly gross wage, QuickBooks will need some “help” when determining the overtime rate. {This becomes complex and cannot be explained in a blog post but I plan on providing a fee-based live and pre-recorded webinar on how to set this up and make it work in QuickBooks – which will be available in January 2012}.
You will need to add an “Overtime” payroll item to your Payroll Item List using either the E-Z Setup or Custom Setup method naming them Carpenter OT, Laborer OT, etc and being sure that you select that the type of wage is an Overtime rate. If the premium OR half-time portion of overtime pay is excluded from Worker’s Compensation tracking, make sure that you have checked that option in the Workers Compensation preference; found from the Edit menu -> Preferences -> Payroll & Employees -> Workers Compensation button and checking the option to “Exclude overtime premium from Workers Comp calculation”
Right click on the image to enlarge it
Make sure that your Codes in the Workers Comp List are descriptive – meaning that when you choose the WC Code in Weekly timesheets that you will understand what code is being assigned to what payroll item.
Setting things up in this manner will provide you with all the payroll numbers that you will need during an audit and clearly indicate the type of wages that are being paid.
If you feel this QuickBooks Payroll tip has been helpful, please take a moment to leave us a comment or to share it with others on your favorite Social Networking site 
