Job Costing and Inventory. QuickBooks Desktop Advanced Certification Prep
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1 Job Costing and Inventory QuickBooks Desktop Advanced Certification Prep
2 Attending this Breakout session for the full 100 minutes entitles you to 2 hours of CPE. Please be sure you check in to the session using the mobile app or, if you cannot use the app, sign one of the sign-in sheets in the back of the classroom. Thank you! #SNH16
3 MB Raimondi, CPA.CITP Advanced Certified QuickBooks ProAdvisor Certified: Enterprise Solutions and Point of Sale 15+ years teaching QuickBooks nationally Charter Member, Intuit Trainer / Writer Network Certified Information Technology Professional (CITP) Member / Instructor, National Advisor Network (NAN) Sleeter Group Certified Consultant / Speaker Intuit Premier Reseller Masters of Taxation Intuit Top 100 ProAdvisor, 2014 & 2015 mb@mbraimondicpa.com
4 Job Costing Job Profitability Reimbursable Expenses #SNH16
5 Learning Objectives 1st Section Utilize methodology for allocating overhead expenses Create Customer Over/Under Billing report Identify the steps to set up payroll to track job costs
6 Important for DCAA Compliance Allocating Overhead Expenses Can use for Classes and/or Customer/Jobs Want total COGS on P&L = Total Job Cost reports Use $0 checks for allocating to classes/jobs OR Use sales transactions for allocating classes only
7 Important for DCAA Compliance Allocating Overhead Expenses Can use for Classes and/or Customer/Jobs Create Overhead or Admin class Use for overhead expenses Allocate periodically Determine meaningful criteria i.e. income or COGS per class to total income or COGS Don t use Journal Entries no items Use $0 check to allocate costs
8 Important for DCAA Compliance Allocating Overhead Expenses Can use for Classes Create items linked to appropriate expense account - $0 sales price Create items for each class linked to same expense account with negative % Create group items with above items Use on $0 sales form using groups, adding classes
9 Customer Over/Under Billing Used for Percentage Complete Projects Revenue Earned = (Total Costs to Date/Budget (Estimate)) x Contract Price Before creating over/under billing report: Estimates must be current Vendor bills must be entered Use Customer Types to filter
10 Customer Over/Under Billing Used for Percentage Complete Projects Run Job Estimate vs Actual Summary Filter for all customer types except Completed Collapse Export to Excel Divide Actual costs by Estimated Costs = % complete Multiply Estimated Revenue x % complete This gives you earned revenue for projects
11 Payroll Setup to Track Job Costs Applying Owner s time to jobs Payroll Preferences Job Costing, Class & Item Tracking for paycheck expenses Assign one class per earnings item Workers Comp preferences Payroll Items Track Expenses by Job If accruing Workers Comp set up Run payroll Look at reports
12 Payroll Setup to Track Job Costs Applying Owner s time to jobs Create Owner s Job Cost Allocation expense account Create double-sided service item Cost $ s = what you would have to pay someone to do the job Cost account = Owners Job Cost a/c Sales side if you want to invoice for time
13 Payroll Setup to Track Job Costs Applying Owner s time to jobs Enter time for owner Use $0 check to pay owner based on time Use Expenses tab to enter a negative amount for the total amount from Items tab Owner s Job Cost a/c Do not enter customer on Expenses tab
14 Inventory Job Profitability Reimbursable Expenses #SNH16
15 Learning Objectives 2nd Section Identify how the cost of inventory is calculated in QuickBooks Pro and Premier Identify the proper process for adjusting inventory Utilize Group items for invoicing flexibility Specify how to use Inventory Assemblies Identify steps for using Multiple Units of Measure Recognize the impact of negative inventory Specify key reports for troubleshooting inventory
16 Inventory Elements QuickBooks Pro Track Inventory Set reorder points Create purchase orders QuickBooks Premier Create assemblies Create sales orders Use multiple units of measure
17 Inventory Elements QuickBooks Enterprise Silver and Gold Report assembly shortages Auto create purchase orders Disallow negative inventory Enhanced inventory receiving QuickBooks Enterprise - Platinum Multiple locations/bins Barcode scanning FIFO Serial number or lot tracking
18 Inventory Elements Inventory preferences Inventory items Requires three accounts Optional reorder points Custom fields Inventory tracked using Average Cost Method (unless in QBES Platinum)
19 Inventory Elements Calculation of Cost of Goods Sold Average Cost Method
20 Adjusting Inventory - Causes Miscounts Theft Damage Mistakes on transactions Mistakes on setup
21 Adjusting Inventory Complete Periodic Physical Counts Validates accounting Manage loss from theft Select proper accounts for adjustment Source account = asset Destination account = expense
22 Adjusting Inventory - Methods Quantity adjustments Value adjustments Quantity and value combine adjustments Don t use a journal entry
23 Using Groups Items - Options Create a pre-set group of items Create a group with items to be added on the fly Facts about Groups Cost is attributed to each item in group Sales tax treatment is per item, not per group
24 Assemblies - Facts Creates Bill of Materials (BOM) Removes components from inventory and includes in finished product Can include sub assemblies in final assembly Sales tax treatment is per assembly Sales price and cost are per assembly
25 Assemblies - Workflow Create individual components inventory, noninventory, service, other charge, other assembly items Create assembly item with individual components Build any sub assemblies Build final assembly
26 Multiple Unit of Measure - Facts Need QuickBooks Premier or Enterprise Solutions Can use different units for purchases, sales and shipping Base unit should be smallest unit Inventory stock status reports have U/M column
27 Negative Inventory Common Causes Buying one item and selling another item Selling an Assembly Item that has not been built Using the expenses tab when purchasing inventory Invoicing date before bill date Invoicing inventory as means to collect deposit
28 Negative Inventory Calculation of COGS Average cost if it exists If no average cost cost field on item If no average cost or cost field on item - $0 If already negative last reported average cost or cost field
29 Negative Inventory Impact Uses last average cost Dates on transactions important Need to be dated before inventory went negative
30 Negative Inventory Correcting Begin proper process today Identify reasons for negative inventory Make sure all inventory items have default cost Do physical count Make inventory adjustment
31 Troubleshooting Inventory Client Data Review Review inventory setup Compare Balance Sheet and Inventory Valuation balances Troubleshoot inventory Adjust the quantity/value on hand
32 Troubleshooting Inventory Inventory Center Available in Premier and Enterprise Only See at a glance: Cost details Quantity details Links to inventory reports
33 Inventory Reports Inventory Valuation Summary Inventory Valuation Detail Balance Sheet
34 Questions MB Raimondi, CPA.CITP
35 We sincerely appreciate your taking time to complete your session evaluation. Our goal is to provide you with the very best training possible and your feedback can help us achieve that goal. Thank you! #SNH16
36 Thank you for attending! MB Raimondi, CPA.CITP
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