Learning CenterStage 2 · ControlGuide 10 of 22
Job Costing 101
Job Costing At a Glance
Estimate vs. actual, one job at a time.
Job costing compares what you estimated a job would cost with what it actually cost, line by line. The gap between the two shows exactly where a job made or lost money.
Estimate vs. Actual: where the job's $12,000 went
Example job · residential landscape installEstimated
Actual
- Job costs
- Gross profit
Every line, estimate next to actual
Contract Price (Revenue)
What the customer agreed to pay for the job.
Estimate$12,000Actual$12,000
—Variance
Materials
Plants, mulch, stone and supplies installed on the job.
$2,400$2,650
−$250
Field Labor
Crew hours × hourly wage. 80 hrs estimated, 96 hrs actual, at $25/hr.
$2,000$2,400
−$400
Labor Burden
The indirect cost riding on labor: taxes, workers' comp, PTO. Here, 20% of field labor.
$400$480
−$80
Equipment (Fleet)
Machine hours × equipment rate. 8 hrs estimated, 10 actual, at $65/hr.
$520$650
−$130
Subcontractor
Outside trades hired for part of the job, such as irrigation.
$1,500$1,500
—
Dump Fees
Disposal of debris, soil and old material.
$100$150
−$50
Job Gross Profit
What the job earns toward overhead and profit. Contract Price − all job costs.
$5,080$4,170
−$910
Job Gross Margin
Job Gross Profit ÷ Contract Price
42.3%34.8%
−7.5 pts
Where the $910 went: the crew ran 16 hours over ($400 labor + $80 burden), materials came in $250 over, equipment $130 and dump fees $50.
Cost one of your own jobs
Starts with the example installEstimate vs. actual on your job
Enter what you estimated and what the job actually took. See the gross profit, the margin and where the difference went.
Estimate
Actual
Estimated
Actual
- Job costs
- Gross profit
| Line | Estimate | Actual | Variance |
|---|---|---|---|
| Contract price | — | ||
| Materials | |||
| Field labor | |||
| Labor burden | |||
| Equipment (fleet) | |||
| Subcontractor | |||
| Dump fees | |||
| Job gross profit | |||
| Job gross margin |
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