how to do construction accounting in quickbooks

QuickBooks allows segmentation by Class, which a business may choose to use for department, line of business or location at their discretion. However, when a business needs to segment by both location and department, it might be time to graduate from QuickBooks. QuickBooks Online wins for accessibility, open-source and a number of available add-ons.

Can you use QuickBooks for construction?

Yes, you can! Not only can you use QuickBooks for construction companies, but it's actually recommended to do so. There are very specific work processes that need attention in the construction industry. Because of this, it's important to have a way to track it all.

QuickBooks Premier Contractor – We recommend for contractors with annual sales over $250,000 or projected to be at that level in the next 12 months. The difference in cost is very small compared to the potential value in additional reporting and Job Costing Reports that are available to you. We don’t recommend QuickBooks Contractor for bookkeepers needing frequent help from an external accountant. The user interface isn’t as intuitive as a cloud-based program, and file sharing isn’t that easy.

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Also, as the contractor grows and requires more from its software program, Sage offers additional programs and modules to help bolster its capabilities. Since QuickBooks isn’t built to maintain a job cost structure, however, QuickBooks users often construction bookkeeping use “items” to represent cost codes. For example, one item might be framing; another might be drywall or lumber. These products and services will be available to all customers and sub-customers, so you don’t need to create one for each job.

how to do construction accounting in quickbooks

The numbers flow through your job profitability reports from a variety of transactions, including bills, paychecks, invoices, sales receipts, journal entries, etc. QuickBooks views all these as either revenue or cost-type transactions. If you post a check, it will increase the cost on your job profitability report regardless of what general ledger account the item on the check are pointing to. If you intended to reduce revenue rather than increase cost, you might have a difference between the total revenue on the profit & loss versus the total revenue on the job profitability report.

Which QuickBooks version is best for construction in 2022?

However, customers who need any additional features will usually need to buy modules to boost the program’s capabilities. Small companies can expect to pay between $10 and $200 each month, but large companies can spend several thousand dollars each month to meet their software needs. If the annual revenue is much higher than the contractor’s, the software probably has more power than is needed.

  • You can filter by job status (in progress + closed) and modify the date range to view contract numbers on open or closed jobs.
  • The challenge with QuickBooks Online is that it is more difficult to use when creating custom reports, exporting and printing reports.
  • Adding the bank feed usually helps shortcut this but is still an extra step that would be best avoided by a more robust electronic payment solution.
  • Sage Accounting doesn’t come with some of the features that large corporations might need, but it’s set up for smaller businesses.
  • Among other things, Knowify also provides advanced invoicing types you won’t find in QuickBooks Online alone, such as payment applications, time and materials contracts, and more.

All four plans provide access to QuickBooks online and customer support. Send your subs a request through QuickBooks and they can upload their tax information right away. The time tracking option organizes the billable hourly time cost and expenses into one document. You can easily send invoices with plans, contracts and photos and also accept payments right on your phone. Bonus, you’ll also receive a notification when an invoice has been paid. QuickBooks Online is an accounting software that allows you to work from any location from any device as long as you are logged into your account.


Unfortunately, there isn’t a demo available, but there is a host of video tutorials, blog posts, webinars, a community forum, and live support. Construction accounting software is known as SaaS, or Software as a Service, and software in this niche can get expensive. It’s important that construction companies compare pricing to ensure that the amount they’re paying is sustainable and will pay for itself in improved efficiency. Follow your budget in real time and take immediate action when errors occur. Job costs are organized, and fully searchable and accessible for forecasting, project management and more. It is also good for companies that want to track their material usage and material costs in their projects.

Can you do project accounting in QuickBooks?

You can add project income, expenses, and labor costs, and run project-specific reports from a single dashboard. If needed, you can also add old transactions to new or ongoing projects. Projects is only available in QuickBooks Online Plus, Advanced, and Accountant.

Finding accounting software for architects or construction firms that won’t leave new users in the dust the second their trial ends is critical. Shoppers will want to look for user resources to reference like blog posts, e-books, whitepapers, videos, and personal private training. This ensures that any questions that come up along the way will be easy to find answers to, whether it’s through a blog post or a company rep.

Manage subcontractors

For instance, a construction company may need to hire a repair technician, the sudden need to generate invoices on unpredictable expenditures whilste being on the job is a constant occurrence. If this is a top priority, QuickBooks Online is a better option. Our experience has been that most construction company owners can generate a stable income if they have good rock solid financial reports and pay attention to their business strategy. Which QuickBooks Edition – Is right for your construction company depends on your annual sales volume and what QuickBooks Reports you want to have? The job costing center provides the top and bottom three jobs ranked on profitability over the last three months. It also includes a few highlights of your recent performance and links to useful job costing reports.