Bookkeeping for Drywall, Insulation and Framing Crews: Job Costs and Crew Pay

What drywall and framing books need to track

A drywall, insulation or framing business is not one number. It is the jobs you ran, the sheets and lumber you bought, the crew you paid, the dumpsters you filled, and the drive to the site. Each part needs its own line so your monthly income stays true.

When you track all of it by job, you can see which jobs made money and which ones spent more on materials or labor than they brought in. When you do not, you get one big pile of supply runs and payroll and no way to tell whether the framing job paid better than the drywall hang.

Drywall, insulation and framing all run on materials and labor. The sheets of drywall, the rolls of insulation, the studs and the nails are materials. The crew wages are labor. The dumpster is disposal. When the books hold the materials apart from the labor and the disposal on its own line, the business makes sense. You can read more about how we keep these lines tied on our bookkeeping page.

Here is what a clean job looks like.

When the materials, the crew pay and the disposal sit on their own lines, your per job profit is real. When they sit together, a big supply run looks like a bad day and the labor earnings hide.

How materials show up by job

The materials you buy for a drywall, insulation or framing job are a cost, even when you also charge for them. The sheets of drywall, the rolls of insulation, the studs, the nails, the mud, the tape. The material is a cost. The materials charge on the invoice is income. The two are not the same.

The clean way is to book the materials cost to a materials cost line when you buy the sheets at the supply yard. Book the materials income to a materials income line when you bill the customer for it. Tag each buy to the job when you can. The two sit apart on the profit and loss. You can see the markup on materials over a month. When the supply yard raises prices, your materials cost goes up and your materials income should follow. You can read more about how we track materials in our painters and flooring materials guide. The same idea works for drywall and framing crews.

The messy way is to book the supply yard bill to general supplies and the materials charge to general sales. Now the materials cost sits in overhead and the materials income sits in the sales pile. You can not tell if you are making money on materials or losing it.

Here is how to keep materials clean.

• **Book materials cost to a materials cost line: ** not to general supplies.
• - **Book materials income to a materials income line: ** not to general sales.
• - **Tag each materials buy to the job when you can: ** so the cost sorts by job.
• - **Watch the materials markup: ** the materials income should track the materials cost.
• - **Match each supply yard bill to the bank: ** so no cost floats untied.

When the materials cost and the materials income sit apart, your materials margin is real. When they sit together, the markup hides and the true profit is a guess.

How crew pay shows up on its own line

Crew pay is the wages you pay the people who hang the drywall, pack the insulation and frame the walls. It is a cost of the job, not overhead. It needs its own line so you can see what the labor really costs you per job.

The clean way is to book crew wages to a labor cost line tagged to the job. When you run the profit and loss by class, each job shows its own labor total. You can see which jobs ate the budget in crew pay and which ones ran lean. When the labor cost ties to the job, your per job profit is real. You can read more about how we track labor costs in our recording subcontractor payments guide. The same idea works for your own crew pay.

The messy way is to book crew wages to general payroll or general wages with no job tag. Now you can not sort by job. You can not tell if the big framing crew ate the budget or if the small drywall finish job was the one that paid best. The wages sit in one pile and the per job story hides.

Here is how to keep crew pay clean.

• **Book crew wages to a labor cost line: ** not to general payroll.
• - **Tag the wages to the job when you can: ** so the labor cost sorts by job.
• - **Watch labor as a share of job income: ** a job that costs more in crew pay than it earns needs a look.
• - **Keep the labor line apart from materials: ** so the two do not blur.
• - **Match each payroll payment to the bank: ** so no cost floats untied.

When the crew pay ties to the job, your per job labor cost is real. When it sits in one pile, the job story is a guess.

How disposal costs show up by job

Disposal is the cost of the dumpster and the dump fees. Drywall, insulation and framing all make waste. Old drywall comes off the walls. Scrap lumber piles up. Insulation offcuts fill the bin. The disposal needs its own line so you can see what the waste really costs you per job.

The clean way is to book each dumpster rental and each dump fee to a disposal cost line tagged to the job. When you run the profit and loss by class, each job shows its own disposal total. You can see which jobs fill the most bins and whether the job income covers the waste cost. You can read more about how we track disposal costs in our tree service equipment guide. The same idea works for drywall and framing waste.

The messy way is to book the dumpster bill to general expense with no job tag. Now you can not sort by job. You can not tell if the demolition job filled three bins or if the new build ran clean. The disposal sits in one pile and the per job story hides.

Here is how to keep disposal clean.

• **Book each dumpster rental to a disposal cost line: ** tagged to the job.
• - **Book each dump fee to the disposal cost line: ** tagged to the job.
• - **Watch disposal per job: ** a job that fills more bins than it earns needs a look.
• - **Keep the disposal line apart from materials: ** so the two do not blur.
• - **Match each disposal bill to the bank: ** so no cost floats untied.

When the disposal ties to the job, your per job waste cost is real. When it sits in one pile, the job story is a guess.

How to match each payment to the bank

Every job invoice, every materials bill, every crew payment and every dumpster bill has to match the bank. The cash comes in or goes out. The books need to tie the two together.

The clean way is to match each job invoice to the bank deposit the day it clears. Match each supply yard bill, each payroll payment and each dumpster bill to the bank the day it clears. The amount in the books agrees with the amount that hit the bank. When a customer pays on a card, the deposit lands net of the card fee. When a customer pays in cash, the deposit lands whole. The bank and the books always agree.

The messy way is to book the payment and never match it. Now the books show income that may or may not have cleared. A supply yard bill that is still pending sits as a cost. A job invoice that bounced sits as income. You can read more about how we match payouts to the bank in our reconciling shop management software guide.

Here is how to keep the match clean.

• **Match each job invoice to the bank deposit: ** the day it clears.
• - **Match each materials bill to the bank: ** so the materials cost is true.
• - **Match each crew payment to the bank: ** so the labor cost is true.
• - **Match each dumpster bill to the bank: ** so the disposal cost is true.
• - **Reconcile the bank each month: ** so the cash total agrees with the bank.

When each payment matches the bank, your cash is true. When they float untied, the income drifts and the real profit hides.

How the month end close works

At month end, every job needs its lines added up. The job income, the materials, the crew pay, the disposal and any card fees all pull together into one job total. When the jobs roll up by class, you see each job side by side.

We start with the bank. We match each invoice, each materials bill, each payroll payment and each dumpster bill to the cleared payment. We book the job income to the income line tagged to each job. We book the materials to the materials cost line tagged to each job. We book the crew pay to the labor cost line tagged to each job. We book the disposal to the disposal cost line tagged to each job. We send you the profit and loss by class, a balance sheet, and a cash summary. Each job sits inside the report in its own column.

Here is a simple month end check.

• **Match each invoice, materials bill, crew payment and dumpster bill to the bank: ** every payment cleared.
• - **Book job income to the income line: ** tagged to each job.
• - **Book materials to the materials cost line: ** tagged to each job.
• - **Book crew pay to the labor cost line: ** tagged to each job.
• - **Book disposal to the disposal cost line: ** tagged to each job.
• - **Run the profit and loss by class: ** so each job shows in its own column.

When the close runs every month, the job story stays clear. When it skips a month, the supply runs and payroll stack up and the next month is harder to close.

A situation we clean up

The materials and crew pay that all sat in one pile

A framing and drywall crew runs ten jobs a month. Every supply yard bill lands in general supplies. Every crew wage lands in general payroll with no job tag. Every dumpster bill lands in general expense. No class tracking is turned on. At month end, the owner can not tell what the materials margin is, what the crew pay cost per job, or which jobs filled the most bins. The bank and the books do not agree because the customer deposits float untied.

Here is how we handle it. We turn on class tracking in QuickBooks Online and set up one class for each job. We set up a materials cost line, a labor cost line and a disposal cost line. We go back through the open month and move each supply yard bill from general supplies to the materials cost line tagged to the job. We move each crew wage from general payroll to the labor cost line tagged to the job. We move each dumpster bill to the disposal cost line tagged to the job. We match each invoice and each bill to the bank. When we are done, the owner can run the profit and loss by class and see each job in its own column, with the materials, the crew pay and the disposal on separate lines. We set up a rule so the next supply yard bill carries the right class from the start.

Mistakes we fix

• Every supply yard bill in general supplies instead of a materials cost line tagged to the job
• Every crew wage in general payroll instead of a labor cost line tagged to the job
• Every dumpster bill in general expense instead of a disposal cost line tagged to the job
• No class tracking turned on so no way to sort by job
• Materials cost and materials income in the same pile so the markup hides
• Crew pay and materials in the same pile so the labor cost is a guess
• No match between the job invoice and the bank deposit
• Card fees from customer payments buried inside net sales
• No profit and loss by class run at month end

Common questions

How do I track materials by job? Book the materials cost to a materials cost line and the materials income to a materials income line. Tag each buy to the job when you can. Match each supply yard bill to the bank. The two lines sit apart so you can see the materials margin.

How do I track crew pay by job? Book crew wages to a labor cost line tagged to the job. Watch labor as a share of job income. Keep the labor line apart from materials so the two do not blur. A job that costs more in crew pay than it earns needs a closer look.

How do I track disposal costs by job? Book each dumpster rental and each dump fee to a disposal cost line tagged to the job. Watch disposal per job so a job that fills more bins than it earns shows up. Keep the disposal line apart from materials so the two do not blur.

How do I match drywall and framing payments to the bank? Match each job invoice, each materials bill, each crew payment and each dumpster bill to the bank the day it clears. Reconcile the bank each month so the cash total agrees with the bank.