How To Do Job Costing In Quickbooks Online?
Updated: Nov 29, 2022
Job costing means income and expenses tracking by a job, and then comparing its actual amount to its estimated amount. It is extremely necessary for any successful contractor, whatever software you use. Usually, contractors choose a specific job costing software that is sophisticated enough for billing, payroll, and reporting. However, some contractors are not ready to use this complex software. That is when QuickBooks or Xero are recommended. Although there are many comments that QuickBooks cannot do job costing, it is still suitable for small contractors, who would like to track expenses and income as well as pull some project reports in the easiest way.
So, how could you use QuickBooks Online to do job costings?
This blog introduces you to 3 ways to do job costing in QuickBooks Online Plus. In case you do not have that edition, it is still okay then.
Before going through some ways to do job costing in QuickBooks Online, let us set up the job-costing cost codes in QuickBooks Online:
For contractors, a basic traditional job cost structure might include:
· Jobs or projects
· Cost codes for particular activities on the project
· Cost types or cost classes that tie out to expense types on the Income statements.
Because QuickBooks is not built for job costing purposes, QuickBooks users could use items (in QuickBooks desktop) or products and services (in QuickBooks Online) to represent cost codes. These exist on both expense and sale sides, therefore you can use them on both invoices and bills, for instance. As the result, you could set up profit and loss reports per item across your whole company.
Adding Products and Services in QuickBooks
· Click on the Gear icon, and select Lists > Products and Services. You can also access to Products and Services list by the Sales on the left sidebar and click on the Products and Services tab
· Click on the [New] button in the upper right corner.
· Select an item type — either “Inventory,” “Non-Inventory,” “Service” or “Bundle.”
· Enter the relevant item information and choose a category to record the income of this item.
· To be able to track costs for this item, tick the checkbox I purchase this product/service from a vendor.
· Click [Save and close].
1. Using Sub-customer as Job:
Sub-customer is the word that QuickBooks Online uses to call Job of QuickBooks Desktop edition. Just like one job is under only one customer, one sub-customer belongs only to 1 customer, whereas one customer can have many jobs or sub-customers.
Adding sub-customers into QuickBooks
· To add a new sub-customer, chose “Sales” on the left sidebar