In This Chapter
QuickBooks Pro and QuickBooks Premier have a feature that's very interesting for businesspeople — such as contractors, consultants, engineers, and architects — who do jobs or projects for their customers. QuickBooks Pro and QuickBooks Premier have the capability to do simple project or job costing. This capability means that your business can create project or job estimates, track costs by project or job, and bill invoices by project or job.
In this short chapter, I describe the QuickBooks job costing feature.
To turn on the job costing or estimating feature in QuickBooks, choose Edit
Note: Progress billing or progress invoicing refers to the practice of billing or invoicing a client or customer as work on a project progresses. In other words, rather than invoice at the very end of a project, you might bill half the agreed-upon amount when work is roughly half done. And then you might bill the remaining half of the agreed-upon amount when the work is finally finished.
While you're looking at the Company Preferences tab (shown in Figure 16-1), let me also mention that as the figure shows, QuickBooks lets you categorize jobs as falling into several different status categories: Pending, Awarded, In Progress, Closed, and Not Awarded. As you might guess, you use these Job Status descriptions to categorize your jobs.
If you want to use QuickBooks job costing, your first step is to set up a job. For example, if you're a contractor, you can use QuickBooks to track the invoices and costs of the remodeling jobs you do. You just need to set up a job every time you get ready to bid on a project.
To set up a job, first set up a customer in the usual way. Then set up a job also in the usual way. In Chapter 3, I describe how you do all this, so I won't repeat that information here. Just to save you time, however, all you need to do is choose Customers
In QuickBooks, job costing starts with an estimate. An estimate is just a list of the estimated costs you'll incur for some job you'll perform for some customer.
Assuming that you've already created a job and have told QuickBooks that you use estimates, here are the steps that you follow to create an estimate:
Choose Customers
QuickBooks opens a Create Estimates form (see Figure 16-2), which bears an uncanny resemblance to the Create Invoices form that you've seen if you've worked with QuickBooks at all. (See Chapter 4 for more information about the Create Invoices form.)
Start filling in the blanks.
Choose the appropriate Customer:Job from the drop-down list at the top of the form. QuickBooks automatically fills in as much information as it can — usually at least the Name/Address text box — on the form.
If you configured QuickBooks to track classes, the appropriate drop-down list shows up in the top center of the form. Go ahead and use the box, if appropriate.
Tip
Feel free to change the default settings — the Date and Estimate #, for example. The Date Setting tricks that you can find in Chapter 4 and on the online Cheat Sheet, which you can find at
www.dummies.com/cheatsheet/quickbooks2010.Add the line items — details, details, details.
You fill in the details of a Create Estimates window in the same way that you fill in the details of a Create Invoices window. Read Chapter 4 if you have questions.
One field that is unique to the Create Estimates window is Markup. The Markup field, which appears on some versions of the Create Estimates window, adds a specified percentage of the line item price total. In Figure 16-2, I specified the markup percentages as zero, so the Amount column values match the Total column values. However, if I had specified a 50 percent markup using the Markup column, the values shown in the Total column would all be 50 percent greater. The Markup field doesn't appear on all versions of the Estimates template: only the Custom Estimate and Proposal templates.
Tip
In Chapter 3, I describe how to add items to the QuickBooks Items list. Each line item that you want to include on your job estimate needs to be described in the Items list. Note that because you often sell work to clients and customers by using, in part, an estimate, you'll typically want to include full descriptions of the items. (My construction-contractor clients, for example, often use several lines of descriptive text to fully explain each item that shows on the estimate.)
Add any optional information.
If you want to, use any of the other boxes available in the Create Estimates window to collect and store additional information. For example, just as with the Create Invoices window, you can click the Customer Message drop-down list and choose or write a friendly message.
You can also use the Memo field to write a note to yourself regarding the job, if you like. Or maybe add some notes about the screenplay that you've been thinking about pitching to the studios. Whatever suits your fancy.
If you want to include other items in the Create Estimates window, you can customize that window. Choose Customize from the Template drop-down list in the upper-right corner of the Create Estimates window. QuickBooks gives you a list of your estimate forms. Choose the one you want to edit. (You may have only one estimate form on the list if you've never created a new one.) Click either the New or the Edit button. If you click New, QuickBooks displays the Customize Estimate dialog box.
In Chapter 4, I talk a bit about how to customize invoice forms. You may want to look there if you have questions about how to customize the Create Invoices form.
Note
Before you print that estimate, remember that the Create Estimates window isn't the same information that appears on the written estimate. To see how the printed version looks, click the down arrow beside the Print button in the Create Estimates window, and choose Preview from the drop-down list. The result is a full-page image, shrunk to fit onscreen.
If you haven't saved your estimate yet, go ahead and click either the Save & New button or the Save & Close button.
Tip
To examine the estimate (or any onscreen QuickBooks form) more closely, either click the Zoom In button at the top of the Print Preview screen or move the mouse cursor over the image. When the cursor looks like a magnifying glass with a plus sign in it, click the left mouse button. Because you can see only part of the preview this way, use the scroll bars at the bottom and right of the windows to move around to the different areas.
Note that the magnifying glass now has a minus sign in it, and the Zoom In button toggles to Zoom Out. If you complete more than one estimate, you can use the Prev Page and Next Page buttons on the Print Preview screen to look at other estimates. When you finish, click the Close button.
When you get back to the Create Estimates window, click the Print button; QuickBooks Pro displays the Print One Estimate dialog box. Click Print to print the estimate without any further ado.
Note
If you haven't used QuickBooks to print estimates before, you may need to set up your printer for this task first. To do so, choose File
To revise an estimate, display the Create Estimates window, as described earlier in this chapter. Then click the Previous button until you see the estimate.
Make your changes, and QuickBooks recalculates all the totals. Smile. Imagine doing this task by hand — the recalculations, the looking up of prices, the retyping, the inordinate amount of wasted time. Making these changes automatically with QuickBooks doesn't quite beat a hot dog with sauerkraut in the park on a sunny day, but it's pretty close.
Note
You can keep only one estimate per job. After you click Save & New, any changes that you make automatically take the place of the old estimate. If you make changes to an estimate, though, you can tell QuickBooks to treat the revision as a change order. With a change order, the modifications to an existing estimate get added to the bottom of the estimate. Cool, right?
You can easily turn the estimate into an invoice by following these steps:
On the Customer Center screen, select your customer.
QuickBooks shows you a list of transactions for the customer, including any active estimates.
Double-click the estimate you want to work with.
The Create Estimates window opens. (Refer to Figure 16-2.)
Click the Create Invoice button at the top of the window.
If you indicated that you might progress-bill a customer or client, QuickBooks displays a dialog box that asks whether you want to invoice the entire estimate or just some portion of the estimate. Answer the question by marking the appropriate option button. Then click OK. QuickBooks creates an invoice based on your estimate (see Figure 16-3). If you need to make any changes, you edit the invoice directly and then click OK to continue.
Tip
If you don't see the Create Invoice button at the top of your Create Estimates window, maximize the window's size so it fills the QuickBooks program window. If QuickBooks can't quite fit everything into the Create Estimates window, QuickBooks removes the Create Invoice button to make room. But increasing the window size should solve the problem.
(Optional) Make any necessary changes to the resulting invoice.
The invoice that you see is a regular QuickBooks invoice, and you can edit it the same way that you edit any invoice. Until you click Save & New, the invoice isn't recorded in your records.
After you make all your changes, click Save & New or Save & Close to record the invoice.
If you want to print the invoice instead, you can click the Print button.
In the preceding paragraphs, I describe how you can take an estimate and create an invoice by using that estimate as a starting point. I also say that you can edit the numbers that come off the estimate. Now, here's an interesting job costing point: QuickBooks prints reports — like the one in Figure 16-4 — that let you compare the item estimates shown on the original estimates with the actual billed items shown on invoices.
To produce such a report, choose Report Center
If you charge a customer for actual costs and hours, you need to track the costs and time when you incur the charges for them. You assign the cost to the job by entering the customer and job information into the Customer:Job column that's shown in the form window used to record a particular cost or time charge. For example, if you use the Enter Bills window (see Chapter 6) to record a bill for a particular job, you use the Customer:Job column to designate the job.
To charge a customer for costs or time that you recorded, follow these steps:
Choose Customers
Change the name in the Customer:Job drop-down list to the proper customer.
This step is easy: Activate the drop-down list and choose the appropriate customer and job. If you have assigned time or costs to this customer, a screen pops up, asking you to click the Time/Costs button to include the charges in your invoice.
Click the Add Time/Costs button.
QuickBooks displays the Choose Billable Time and Costs dialog box. The dialog box already shows the costs and time charges that you assigned to this customer and job combination.
Select the billable time and costs that you want to add to the invoice.
Check the time charges and costs that you want to bill for. Note that the Choose Billable Time and Costs dialog box provides different tabs for Items, Expenses, and Mileage.
(Optional, Expenses only) Indicate the markup.
The Expenses tab has a couple of extra fields at the top of the tab to indicate the Markup Amount or % and the Markup Account. If applicable, fill in the fields with the appropriate information.
(Optional) Indicate whether you want the charges to appear as a single item on the invoice.
If you want to avoid listing the gory details of the charges to your customer, check the Print Selected Time and Costs As One Invoice Item check box located in the bottom-left corner of the invoice.
Click OK.
After you have everything the way you want it, click OK. As if by magic — even if it was by your hard work and the sweat of your own brow — the invoice appears.
(Optional) Add anything else you want to include on the invoice.
This invoice is a regular QuickBooks invoice, remember? You may want to click the down arrow beside the Print button and choose Preview from the drop-down list to make sure that only the job costs that you want to appear do appear.
Click Save & New or Save & Close.
That's how you record the invoice.
After you record the invoice, the job costs that have been billed are removed from the Choose Billable Time and Costs window. You're finished. Breathe easier.
Tip
You can also track the amount of time that you or other employees spend on clients or customers. To turn on time-tracking, choose Edit
And a final important point: The time-tracker clock keeps ticking as long as the QuickBooks program runs. The program doesn't need to be the active Windows program to continue working. (I mention this because in some older versions of QuickBooks, the timer stops if you start working with another program, such as your word processor or e-mail program.)