Question

Labor costing

Forum|Forum|4 years ago
April 19, 2022
1 reply
26 views

Do I need QB Time and/or Payroll to be able to apply hourly costing to an employee and see that cost pull through on job profitability reports?

QB Desktop pro plus 2022

QuickBooks Desktop

M

Mark_R

Moderator

I'm here to help track your employee's hourly cost, @Aaron at LTJ.

You don't need to have QuickBooks Time or Payroll services to track your employee's hourly costs. You can utilize the Time Tracking feature to record an hourly cost. Let me guide you through the process.

Firstly, let's turn on the Time Tracking feature in your company file. Here's how:

Open your QuickBooks Desktop company file.
Go to the Edit menu, then select Preferences.
Click Time & Expenses from the left menu.
Go to the Company Preferences section and select Yes to turn on the feature.
Select OK to save the settings.

Once done, you can now enter a weekly or a single timesheet to track your employee's hourly cost. To do so, please follow the steps below:

Go to the Employees menu, then select Enter Time.
Choose Use Weekly Timesheet or Time/Enter Single Activity.
Enter the information needed.
Click Save & Close.

After the steps, the information will show on your job profitability report.

You might also want to read this article to learn more about job costing in QuickBooks Desktop: Track job costs.

Please let me know if you need clarification about labor costing. I'll be standing by for your response, @Aaron at LTJ.

A

Aaron at LTJAuthor

Mark_R,

We have done everything mentioned and no labor cost are pulled through to the "actual" column. Cost for job related expenses comes through for PO's that were put on the job. We also don't see a location to enter an hourly cost for each employee to calculate labor cost from, it looks to me that we would need to have payroll turned on to enter a compensation cost for the employee or another means from QB Time. QB Online seems to have this configured considerably different and better for job costing purposes.

We have read that thread thoroughly and under stand a time sheet is a non posting transaction but we get confused by this note

"Timesheets are a non-posting entry. You must import time to a bill or invoice to include it in the Job Profitability or Company Financial Reports.".

We don't understand what they mean to "import" time, when creating an invoice we select the job we are invoicing and pull expenses and time through to the invoice by either the pop up window or the "add time/cost" button. Which I would believe we are "importing" to the invoice this way.

It would be nice to pull a report showing all labor hours and material cost that was applied to each job.. don't know if I've found that yet as the "quick report" in the job doesn't pull hours through just cost.

JenoP

QuickBooks Team

Hey Archie,

Since we have an outside payroll service I don't feel it necessary to pay for QB Payroll just to utilize its labor costing feature. So I tried utilizing manual payroll and ran a serious of test to get cost to pull through that way and still cannot get it to function. Do I need a paid version to get this to work? The Payroll info tab did show in the employee center and I followed all suggested steps as before.

Allow me to jump in and help with your questions about tracking labor costs without a payroll subscription, Aaron.

You can track time entries and associate them to a job without a payroll function. This is the reason why previous responses indicates that you don't need a payroll subscription to enter the employee's work hours.

Please note that time entries are non-posting transactions and will not show up in costing reports. Because of this, you'll need to associate a payroll item in the timesheet and use it in a paycheck. This is the only way to post the labor under cost under the Act Cost column.

You mentioned that already activated the Manual Payroll feature. This means that you don't need to have the paid version to be able to track labor costs. You just need to follow these steps to use the time data to create paychecks:

Go to the Employees menu and double-click on the name of the employee.
Proceed to the Payroll Info tab check the box for Use time data to create paychecks.
Select OK.

Once done, edit the time entries and select a payroll item under the Payroll Item column. Let me show you how:

Go back to the Employees menu and select Use Weekly Timesheet under Enter Time.
Click the drop-down list under the Payroll Item column, then click Add new.
Choose Hourly Wages and select Regular Pay.
Follow the succeeding steps on how to create the payroll item.

After that, create a paycheck to pay the employee for the tracked hours. Let me share these final steps with you:

Select Pay Employees under the Employees menu.
Make sure the date in the Pay Period Ends is the last date of the week in your timesheet entries. This is to include all tracked hours in the paycheck.
Check the name of the employee and click Open Paycheck Detail.
The number of hours and the payroll item will automatically show up.
Choose Save and close, click Continue, and then select Create paychecks.

Then, open the profitability report and check if the amount is already showing up under the Act Cost column.

Adding these articles as well for more guidance when using this feature:

Please keep me posted if that resolves your question about tracking labor costing. I'll keep an eye on this thread as well in case you have follow-up questions.

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