Estimating strategies
The estimate in QuickBooks is critical because it is the place that holds the original estimate
and any changes to the estimate.
QuickBooks estimates are required for creating
some job cost reports, including the Cost to Complete and Job Estimates vs. Actuals reports.
These reports are very important to the person who manages the project, to make sure the project budget is on track. They are also important to the estimator, to evaluate how accurate the estimates are and adjust them appropriately for future projects.
QuickBooks estimates are also required for creating progress invoices.
There are two basic strategies for handling your estimates:
Create all your estimates using QuickBooks.
Create detail estimates using a spreadsheet or another estimating program, and then bring a
summary estimate into QuickBooks.
Creating estimates using QuickBooks
If you do not need a very large and complicated detail estimate, you'll probably want to create
your estimates using QuickBooks. This has the advantages of using one accounting program, not
having to do duplicate data entry for estimates, and having your full estimate details in
progress invoices and job cost reports.
Once your estimates are in QuickBooks, the estimates
flow automatically to invoices and job cost reports. See
Estimating and invoicing overview
to get an idea of the QuickBooks process flow from creating estimates, through invoicing, to
receiving and recording payments.
See Creating estimates for information on how to create
estimates in QuickBooks.
Creating detailed estimates outside of QuickBooks
Sometimes a general contractor or home builder may want to use a spreadsheet or estimating
program for detail estimating. For example, if you are creating an
estimate to build a new home you might have a list of 10 to 20 different building permits,
licenses, and fees that need to be listed on a spreadsheet template under the phase Permits.
A company that builds new homes might have a spreadsheet template designed for their business
that has several hundred or a thousand different items on it. That spreadsheet is designed
as a "tickler" to remind the estimator of costs that might get forgotten if they weren't listed.
If this describes your situation, you might want to use a spreadsheet or estimating program to
create the details. Then use your estimating program to generate a summary by phase report,
and follow the instructions in
Creating estimates to enter the summary estimate
into QuickBooks.
If you create estimates outside of QuickBooks, but you create set or fixed price invoices in QuickBooks (as opposed to Time and Materials invoices), you are already entering the information into QuickBooks that you need for estimates. Consider entering your invoice information into the Create Estimates window instead of the Create Invoices window. Then you can automatically turn the estimate into an invoice by clicking Create Invoice at the top of the estimate form. This gives you both estimates and invoices in QuickBooks by entering the information only once.
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