JOB COSTING SOFTWARE - PROJECT COSTING SOFTWARE
What is job costing software? Job costing is a branch of managerial accounting that is typically used for special orders or where a product made is unique. For a typical job, materials and labor are applied and tracked until the job is completed. Overhead is usually applied pro rata based on direct labour hours. Process costing differs from job costing in that it is used when products are more homogeneous in nature, and tracks a process rather than a specific job.
Why is job costing software so important? It allows you to ask yourself - what is the profitability of this job? It allows a business to maintain complete control over all jobs in the enterprise and ascertain at a glance the costs/revenues associated with each job. If you don't know the exact position of each job and of the overall business, how can you make sure you are making a profit?
Without job costing software (or project management software), you would not know where potential problems lie. The owner would not know which jobs are profitable and which are not. Job costing software does all the hard work for you and produces this information at the touch of a button. It saves an incredible amount of time and effort, and allows for an efficient enterprise.
Job costing software should address issues such as breaking down job materials by customer, time spent on each job along with exact amounts, profitability of each job, fluctuations in profitability from month to month. Some accounting software packages have job costing functionality built-in. We recommend using Quickbooks Premier as it can:
1) Define an item, and allocate costs/income to each item. This will
allow you to calculate profit per item
2) Sales/invoicing will record the income part of each item
3) When purchasing products, you can allocate it to a particular item to track costs
4) Quickbooks has a time tracking mechanism so you can allocate employees' labour to each item
5) Preformatted reports allow you to produce job costing information at the touch of a button. This can be done over any time period.
Click on the links below to get more information on Quickbooks job costing software.