Recent Articles

Class Accounting

Class accounting is a form of accounting whereby the revenues and direct costs are grouped into classes. It is a very effective form of accounting in construction. Learning how to use class accounting in construction is easy and works extremely well with phase accounting.

Bookkeeping – Departmental Accounting (Lesson 71)

09/02/2017

One of the goals of accounting is to report to management performance results, specifically financial performance.   Since most businesses sell more than one product or render more than one service, management is interested in understanding the [...]

P&L Statement – Best Format for Salons

02/01/2017

An owner of a hair salon needs a well organized and properly formatted profit and loss statement (income statement) to properly evaluate performance.   There are multiple presentation formats used in the service industry, but after 21 years of [...]

Profit and Loss Statement Using Class Accounting

09/27/2015

Class accounting breaks down sales and the associated cost of sales into functional groups.  Whether you use divisions or departments or product/service lines class accounting allows you to identify those more profitable areas of operations.  This [...]

Construction Accounting Terminology

05/15/2015

In construction accounting accountants and bookkeepers use certain terms and there are distinct meanings associated with these terms.  This article is designed to introduce beginner accountants and contractors to these terms from the perspective of [...]

Branching Out in Construction

05/05/2015

When you own a small construction company many people depend on you.  There is your family, employees and subcontractors.  A typical $2,000,000 per year operation will have upwards of 20 people dependent on the contractor for their livelihood.  [...]

Progress Billings in Construction

04/27/2015

Just like a tip of an iceberg, a progress billing for a construction project is an invoice for a small part of the overall contract value.  It needs to be recorded correctly and presented to management in a way that is understandable and beneficial [...]

Project Accounting Principles for Residential Contractors

04/04/2015

Almost every residential contractor I had as a client had no clue of their financial position as it related to any one of their residential contracts.  None of them knew whether the project was fully funded, over funded or unfunded at any point in [...]

Project Accounting – Introduction and Value

10/17/2014

In the world of accounting, project accounting is a subset of financial accounting.  Many folks believe it is a form of cost accounting and it is not.  Cost accounting is more formally a function of manufacturing and deals with large quantities of [...]

Using QuickBooks in Construction Accounting

06/08/2013

Over the last 17 years I have become a fan of QuickBooks over other accounting software.  Having been involved in construction accounting, I have set up over 9 different construction clients on this software.  Overall it is the easiest and one of [...]
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