Job costing - Item Setup

Make sure  you have  the progress  invoicing preference  checked  if you  are using  that. 
Go  to Edit>Preferences>Jobs & Estimates>Company Preferences>
Click yes  on do  you create  Estimates and do you Do  Progress Invoicing.

For Inventory  make sure  you have  Inventory turned on Edit>Preferences>Items & Inventory>Company Preferences  Tab>make  sure "inventory  and purchase  orders are  active is  checked.


To set up for job costing:
Set up Items:
1. Go to List>Item List>right click and New. 
2. Set up an item called whatever you want to call it and check the box that says "this service is used in assemblies....." a box will then be available so you can choose an expense account in the Cost of Goods Sold.(For Inventory  choose an  Inventory Part and ignore line  2 below  as the  Cost boxes  already appear) 
3. On the lower right is a drop down to choose an income account, not your bank account.

Set up Customer:
4. You need to enter a Customer:job so that you could post the "Expense" (PO)and the "Income" (invoice). 
5. When you enter a Customer you can either enter an Estimate and then enter an Invoice to that or you can just enter an Invoice.
6. If you enter an Estimate and then an Invoice, when you enter the Invoice you will be notified that there is an Estimate available to post the Invoice to. 
7. If you do not use Estimates and use "billable" costs and time you will enter an Invoice and will receive a pop up giving you the option to choose the billable time & expense to enter. When the Customer pays you, enter it by going to Customer, Receive Payments.  The payment is sent to an account called "Undeposited Funds" and once you are ready to take the check to the bank you will go to Bank>Undeposited Funds and choose all checks from Customers that you have entered and are going to deposit.

Set up Vendor:
8. When you enter the PO if you use the Item and enter the Customer Name in the "Customer Column" on the PO then when you enter a bill from the Vendor you will be asked if you want to receive against the PO, say yes and click on the PO and enter the bill using the "Item" tab on the bill.  This will post the cost against that Customer If you  want to  make an  expense "billable" leave the billable  box checked  and then  when you  issue an  Invoice to the Customer you  will receive  a pop  up box  that gives  the items that  are available  to bill  to the  job
9. To pay the bill go to Vendor>Pay Bill>Click on the bill and down below you will choose if you want to pay by check or credit card, etc.
10. You can also enter the Customer:Job when entering payroll to "job cost" the hours. You will need to have payroll Items set up to do this.  You can search the help menu for instructions or ask more questions.


If you use time & material billing see the help menu for billable time & cost instructions.
All of this is how a PO is "linked" to an Invoice and you can see this by going to the Reports. There are several reports you could look at, however one category is the Jobs Mileage and Time, Job Profitability Summary.  If you double click on the numbers under the Act. Cost and Act. Revenue columns you will see the cost and income you recorded.



Set up mistakes to avoid: http://support.quickbooks.intuit.com/support/NURCenter/default.aspx?tab=mistakes