Bookkeeping for Construction Companies – Nashville, TN Accounting Firm

Hi. This is Evan Hutcheson with Evan Hutcheson CPA, LLC and I want to show you one of the most.

Hi. This is Evan Hutcheson with Evan Hutcheson CPA, LLC and I want to show you one of the most efficient ways to do bookkeeping for your construction company. and I’m going to gear this
Video toward small construction companies. I can do another one for
larger. But for now I just want to give you a great idea of what you need to do to get
your bookkeeping underway. But depending on your business, you might need to be a
few changes he’ll have to make I’m just showing you the bare bones. But if you if
you can grasp this concept which is a very easy then you can add things to it
which will be simple as well. So if you tell me or you tell your CPA or your bookkeeper what
exactly you want out of your bookkeeping then we should be able to alter this
according to your desires. I’m a CPA that works a lot with construction companies.
I do bookkeeping tax work, workers comp audits, financial statements and so forth.
But I really, what I enjoy the most is the bookkeeping because I just like to,
I mean a lot of construction companies, when I look at their books it’s a
complete mess and I just like to clean them up, show them how it works show them the
best way to go about doing it, have them understand the statement that
they’re looking at and I feel like they get a whole lot out of it. And I’ve
come up with, through trial and error, just best, most efficient way to come up with
understandable statements at an affordable rate. So this can be done
fairly quickly by a competent CPA, and me, I have a bookkeeper that I use a lot so
I’m able to charge very affordable rates. I just review their work all the way through but I can do that
fairly quickly and we can charge great rates to you if you’re interested. But
this is kind of…I’m going to run through it real quick because I know no one wants to watch a
thirty minute long video. Here is ABC Company LLC. This is the profit and loss statement. We’re showing a million in income, cost of goods sold right here. What is it? About
730 grand, gross profit of 360, operating expenses of about sixty so you’re
looking at $300,000 net income. So this is, I’m just showing you a general idea of the
company we’re looking at right now. Now what I have these companies do,
is depending on how often they want their books updated, whether its
daily, weekly, biweekly, monthly, I’ll have them export, out of the bank statement and out of their credit card statements, the transactions. So they export these
transactions and it looks something like this when you do that from youre online banking, this is what pops up. Then I’ll have the
construction company owner or maybe their assistant who knows what job and
what expense each one of these each one of these transactions is, they’ll need to
fill out these three columns. Now, the reason do this, I know there are a lot of small
construction companies who don’t want to spend a lot on bookkeeping. So this is
geared towards those companies. Now if you’re not going to spend a lot of
bookkeeping one thing you’re gonna have to do is you’re going to have to work, do a
little bit of it yourself, and this is where you come in. Instead of your bookkeeper or your CPA figuring out what all these jobs are, that’s what you’re going to do right here, and then
you’re going to hand it off to the accountant who is going to input it into QuickBooks and give you an accurate set of books back, and then explain everything to you,
what everything means. So, what you need to do in order to put in a job and the
code is have a job code spreadsheet. So here are the codes, this is a basic expense:
foundation, permitting, insulation, framing and so forth. it doesn’t have to look exactly like
this. This is for a small home builder. But I have other homebuilders who have
completely different lists. They might have planning, excavation concrete, brick
materials. You know it’s just everything is a little different so depends on how
you want to organize it that’s totally up to you you can use this as a template
if you want but so you’re you’re making all these codes and all these
subcodes under parenting all these codes under a missile is another pain and then you have a job
numbers so each one of your jobs and working on is gonna have a different job
number I have always job numbers all these codes for the expenses and have an
overhead overhead job number with all these general administrative expenses
that are gonna be built towards a job and you use on his codes as shorthand on
your spreadsheet so in your checking account exterior paint material because the job
over 30 that might be 123 Main Street in the coast to coast 680 which in this
case would be exterior paint material now that’s not really the case I just
made that up we look at 0680 is mechanical electrical low voltage final
after the road and so you can you can do whatever you want here you just you put
these codes into the actual spreadsheet right here and this stuff to me I know
your codes I have a spreadsheet to so I am put them all and in QuickBooks and
then you know you have this report will have other affords you can look at
reports per job which can be pretty useful or you can get the actual race
estimate detail want to hurry Main Street assuming it an estimate our
budget year is your estimated cost column here is your actual costs which that I would put in there is a
difference between the actual estimate and so forth this particular company doesn’t have
anything that’s called because they don’t invoice out based on their their
bills they just take draws out as income so that’s why saying every company every
business is different we can always change a few things but long story short
and arranging on use this strategy right here all these goes and then put them on
the export you take out your credit card online credit card or bank statement and
you have something that your CPA or your bookie very accountant can work with and
I can do it really quick I do it really quick I review all the work I charged
with minimal fee per month and then we’re done I mean that’s all there is to
it by then can go to our GoToMeeting so I’ll pull up the QuickBooks give them a
phone call have them get on the computer and we can talk about what we see in
QuickBooks we probably do that at least once a quarter you know sometimes once a
month sometimes once a quarter and that way you will know exactly what’s going
on inside of your books and if you have any questions after looking at it
yourself you can address those at that time and we can look at them together so
you know if this quiet this is this is pretty small you know this is one of the
working on it the only purchasing a few transactions a day but you know will
will charge a monthly basis $200 and that’s pretty much it and that
takes care of everything I think of all the books you’ll know exactly what’s
going on in your book says I love to talk about people’s books and explain to
them how how it all works so I think it’s the best bang for your buck when
when its construction company bookkeeping and that’s all there is to
it I don’t think there’s a better way to do it for a small construction company
its works for me I enjoy doing it works for you just it just works for everybody
so if you have any questions feel free to email call whatever I’ll try to
answer them in the meantime if you are interested in something like this with
me please let me know and love to help out and if you want even tell your CPA
or your bookkeeper about it see if maybe they can work on it with you that would
I’m sure they wouldn’t mind doing that either so I hope you have you got
something out of this and we’ll talk soon thanks a lot

8 thoughts on “Bookkeeping for Construction Companies – Nashville, TN Accounting Firm”

  1. This video was extremely helpful. My husband and I have a design/build business in Texas that really took off this year and I am overwhelmed with the bookkeeping part. Any idea if there is a job code template resource out there online somewhere? Just wanted to check before I reinvent the wheel…

    Thanks again for such a great video!

  2. Evan, thanks a bunch for your help, your expertise was much appreciated, I'll definitely recommend you any chance I get !!

  3. Appreciate Video clip! Excuse me for butting in, I am interested in your initial thoughts. Have you heard about – Rozardner Successful Handyman Reality (do a google search)? It is a smashing one off guide for how to start a handyman business without the headache. Ive heard some super things about it and my BF after many years got excellent success with it.

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