How to Track Expenses by Project, Bookkeeping Tips for Job Costing and Tax Deductions

Episode notes

That big client you are proud of might actually be costing you money. This is one of the most shocking truths small business owners learn too late. Not all revenue is good revenue. Some projects look impressive because the invoice is large, but the profit is tiny. Other jobs may seem small, but they produce the highest profit margin. If you do not track income and expenses by project, you are guessing. Then tax season hits and you cannot clearly prove which expenses belong to which job. In this Tax Season Saturday episode, Patricia Oholeguy breaks down job costing for small business owners and shows why project tracking is essential for both profitability and taxes. A $10,000 project can easily lose money when direct costs, labor, materials, subcontractors, and time are not tracked properly. Meanwhile, a $1,000 job can quietly be your most profitable service because the overhead is low and the workflow is efficient. You will learn the fundamentals of project profitability, including how to calculate income per project, how to track direct costs, and how to allocate overhead expenses so your financial reports reflect true profit.