 In this presentation, we will continue applying overhead to jobs. Let's get into it with Intuitz. QuickBooks Online. Here we are in our job costing company dashboard. We're going to first take a look at our Excel sheet to see what our objective will be. We're continuing on with the overhead. We're going to go a little bit faster this time because we're going to have the same kind of sequence with the overhead, even though we're going to have different, basically, items for it. Because all the items are similar in that we couldn't apply them directly to the job. And therefore, we have to use some kind of method to apply them to the job. We're going to apply them in accordance with the ratio which we saw last time. So last time we completed this one for the cost of goods sold, that's related to the indirect labor. Now we're going to go to the indirect materials, indirect materials, things that we couldn't apply directly to the job, like glue or grout or something like that. So we're going to have to use some kind of allocation method, which will be our percentage method. It's still going to increase cost of goods sold, which in QuickBooks we're going to break out into more detail for the cost of goods sold under the overhead category of cost of goods sold for. And then we'll give more detail on that in the type of category indirect materials. And then cash is going to be going down. And we're going to assume we're paying whoever we pay for the indirect material. So if we go then over to the right, I'm going to go ahead and say we did this one. So I'm going to make the ones we have done yellow. So the yellow ones are the ones that we did last time. So I'm going to make these yellow. This is an attempt to be less confused and mixed up as we go forward. So we'll see if it works or not. But I think the colors are quite effective, actually. And they won't stop me from getting confused, but they lessen it. So then if we were to add these three up, so if we add these three up, we're at the 30,000. There's the 30,000. Let's go back on over to QuickBooks here. And let's go to new. Same process as last time. We're going to say we want a new expense, a new expense. So we'll add the expense item, kind of like a check, but it's an expense here. And we're going to say that we're going to be making a payment to staples. We could use a check, by the way, if that's how we were paying them. This is going to be a new vendor. I'm just going to pick staples as the vendor. So we're going to set the vendor up. It's going to be coming out of the checking accounts. We're going to make this as of the date of the 30th, it looks like. All right, let's pick it up. All these happened on the 30th. Seems like, whatever, we'll keep it all on the 30th here. And then payment, let's just say cash, check, cash. We'll keep it cash. And then we're going to go down to the category. We're going to do a similar process we did last time, but actually not the category. I want to go down to the items. Similar processes last time, where we're going to set up new items and then new accounts within them, both at the same time here. It's going to be great. So indirect materials, I'm just going to type it in there, tab, and then it's going to say, hey, we don't have that account. I'm paraphrasing the software. And so we're going to put it into a non-inventory. And then I'm going to copy the indirect materials that we want. Going to put that down here in the description line. So we'll put that in the description there. Put it down in the description here. And then it's going to the correct sales account. These are the double-sided items that we've set up before. And then we're going to say it needs to go into an expense account, but I don't have the expense account set up either yet. So I'm going to type in the same thing here, indirect materials, and set up an expense account for it. So simply add the expense account. But it's going to be a cost of good sold, not just any expense, but a cost of good sold kind of account. I'm not too worried about the second one here. I'll just put it into other usually. And then I'm going to say sub account. This is like the important point. It needs to be a sub account of the overhead. Let's pick up the do it right this time, because I messed that up last time. We're going to pick up the overhead. And then I'm going to say save and close. So that's good. And we set up the account. And then we're going to set up the item, save and close. And that should be good. So there we have it. And then we're going to say the amount is going to be 5,700 because that's the amount that will be billable and applied to job number 14. Job number 14. And then we're going to do the same thing indirect materials here. And this one is going to be for 9,900. And that's going to be the amount that will be billable and of course apply this time to job number 15, our second job. And yes, we will do this one more time indirect, indirect. There's a D, direct materials. And then tab. And this one's going to be going for the 14400. It's going to be a billable item. So we'll say it's billable as well. See kind of a pattern here. There's going to be 16. 16, because that's the job or account. So these amounts, of course, line up to the amounts that we broke out in accordance with our percentages, which is the 19, the 33, and the 48 that adding up to the total of the 30,000. So now that I have these highlighted, I'm going to right click on them. I'm going to make them yellow. And those look good. All right, so that looks good. Let me just check that one more time. Yeah, I think that's good. OK, so now once we record this, what's going to happen? It's going to be writing a check, decreasing the checking account by the 30,000. That's going to be a check where assuming it comes out or it goes to the vendor of staples. And then the other side is going to the materials, which is going to be driven by the items going to the expense or cost of goods sold accounts here. And then also being applied to the job or projects 14, 15, and 16 in a vertical order, respectively. OK, let's do it again. We're just going to do the next one. So I'm going to say save and new. And we'll do this a few more times. Similar process. I'm going to go back on over to the expenses over here. Back to the Excel worksheet. Let's go back on over to the left and see what we have next. And that's going to be the utilities. Now, it's on the factory or wherever we do our work. So again, that utilities is something that we do all the jobs or part of it there, right? And so we don't know where to apply it. So we're going to have to use some kind of percentage method to do so. Therefore, the journal entry is going to be the same. 12,000 debit, 12,000 credits going to go into cost of goods sold. We'll make it more specific when we put this into QuickBooks, meaning we'll put it into the cost of goods sold with a subcategory under factory overhead and under the category of utilities. And then cash going down, assuming we're paying something like the utility company, someone like Edison, as we will see. And then we're going to be picking up, according to the 1933 and the 48%, we will break that amount out. The 12,000 between the 200280. And then I'm holding down Controls so I can add these up. I let go of Control when I scroll down or else it changes. OK, so there's the 12,000. So that's how we're going to allocate this one out. So let's do it. Let's do it. We're going to go back on over to our expense account. We're going to make this one go to Edison. Edison, that's going to be our utility company that we pay. It's going to be a new vendor. Make that as of the 30th. I'm just going to say cash for the payment method for purposes of the practice problem. We're not going to be using the categories but the item detail down below once again. So make sure you're down there. We're going to do the same kind of process, setting up a new item and a new account within it. So we're going to say Utilities and Tab. And it's going to ask me to set that up. And I'm going to say, yes, please. We want to make it a non-inventory so we could make it a double-sided or two-sided item or service or whatever. And then in the description, we're going to say that it's going to be Utilities down here. Sales account is correct on the purchase account. We want to make it Utilities. And we want to make a new expense account, which is actually going to be a cost of good sold account for Utilities. So I'm going to enter Utilities. Say actually Utilities, we're going to have to differentiate it because they have Utilities in there. But I want to make this a sub-account. So I'm going to make it Utilities jobs. And I might want to overwrite that other Utilities. In any case, I'm going to make it jobs just to differentiate it. Then because I don't want it in an expense account, I want it to be part of the cost of good sold, more specifically, the cost of good sold under the overhead type of account. So I'm going to make it cost of good sold type of account. We're going to make it an other here. I'm going to make it a sub-account in the sub-account of the overhead account. So I want to make it an overhead, which just like we did before. So we set up a new account here, sub-account of the overhead. Save it. We also set up a new item right here. So we're going to save that. And then there we have it. That's it. And so the rate we're going to say is going to be 2280. We'll make it a billable item. And then this first one's going to be going to job number 1414 or project, whatever you want to call it. And then utilities again. So utilities item, this one for the amount of 3960. We're going to make that a billable item. This one going to job number 15 or project number 15, however you want to label that. Then utilities one more time. We only get one more utilities. That's going to be for the amount of 5760. That too, billable. And job number 16 this time. Job number 1616. So there we have that. These amounts of course line up to the amounts that we have allocated up here. I'm going to now make this yellow. I hope they do. I'm pretty sure they do. I'm not going to get too picky on the check. So we're going to say that. We'll check them, obviously the financials. But in the case there is that. And then what's this going to do when we record it? It's going to be decreasing the cash account by the 12,000 because we're going to be actually paying Edison. Then it's going to be allocating to the utilities account. But this time to cost a good soul, the sub-account costs a good soul type of account under the overhead account and be allocating them to job 14, 15 and 16 according to these amounts, respectively. Let's do it again. We're going to say save and new again. And let's check out the next one. Going back to our Excel worksheet and checking out what we got next. So next is the factory rent. So same process. We're saying we're paying rent on the factory where we do work. So we need to allocate that to the jobs to overhead somehow. But we're going to have to use a percentage to do that. Same journal entry then. Debating costs a good soul. Crediting the cash costs a good soul. When we put it into our system, we'll be further broken out into the subcategory of overhead and rent. And then we need to break that 20,000 out into the jobs. We will do so with our percentages of the 19, 33 and 48 for job 14, 15 and 16 respectively. The numbers then being that 3,800, that 6,600 and then this 9,600 for the total of the 20,000. Okay, same process. We're going to go back on over here. This is going to be good times. We're going to set up a new vendor and we're just going to call it rental company. That's their name, rental company. Not very creative name, but that's who we pay the rent to for our warehouse or wherever we do our working. And so that's going to be out of the checking accounts. We're actually going to be paying them with the checking account. There's going to be the date as of the 30th. We can make a cash or a check, whatever. I'm going to make a cash for the purposes of our practice problem. Remember that we're going to be down here in the detail area. We're going to set up a new product and service and a new account as we set up the product and service. That's going to be called rent, also rent. So we're going to add rent. Now I could say add rent for the job. We don't actually have an account called rent, so I can just call it rent and apply it to the type of account, the job type of account. We're going to be saying it's a non-inventory item so we can use that double-sided item again, which is what we want to do. And we're going to say description is just going to be rent and it's going to the correct sales account, then purchases, rent, and then I want to set up a new account down here as well. So I'm going to type in rent and then not rent in leases, I'm going to just say rent. And I might want to call it for job or factory rent and then say tab. And then I'm going to set that up. I want to make sure it's a cost of good soul type of account. It's going to be, I'll just put it into other costs to good sold. And then I'm going to say that it's going to be a subcategory of the factory overhead. So the factory overhead now has some subcategorization. We're going to say save and close. There's that set up, set up the account. Now, once I say save and close here, that sets up the item. Then we have the rent that looks good and we'll just put in our amounts again, that being for the 3,800. This is going to be billable. And then this is going to be starting out for job number 14, job number 14. Then we're going to be going to the rent again, rent again and that's going to be rent. And this is going to be for the amount of 6,600. This is going to be billable as well. And job number 15. So now that's job number 15. And then we're going to go to the rent. In case you thought we were going to switch things up. No, rent. And then this is going to be for the amount of 9,600. This is going to be for a billable item. And we have a series going. This is job number 16 or project number, however you want to call it. What's this going to do when we record it? Well, it's going to be decreasing the check-in account by the 20,000. The items are going to be driving it to the proper expense accounts, which will be the cost of good sold accounts. And then of course, alligating them to the jobs 14, 15 and 16. Let's go ahead and say save and close this time, even though we're not done yet. I'm going to say save and close. And then if I go back on over to Excel now, I'm going to make these yellow because we've done those. Yellows means done right now. I usually like making green done, but they were already green. So we're going to make them green to yellow. Yellow means done. So we're going to go back on over here and then we say that next we have the depreciation. So depreciation is a little bit different because we're not paying anybody, right? We're recording a depreciation. So that's a little bit different to record. Now note that the journal entry is the same. It's going to be a debit to the depreciation to the cost of goods sold, which we're then going to have to allocate because we're depreciating equipment that was used on multiple jobs. We'll use the same kind of allocation method, but the credit's not going to cash. It's going to accumulate depreciation, which we have that similar kind of problem because how are we going to, you know, what type of form are we going to use if we use the expense? Usually the cash goes down. So we're going to have to use a similar kind of method we've seen in the past, but the allocation then is going to be similar over here in terms of the expenses, we're going to allocate 19%, 33%, 49%, 14, 15, and 16 jobs respectively, that 5,700, the 9,900, and the 14,400, then adding up to that 30,000. All right, let's go back on over and see how we can do this. We're going to go back on over to QuickBooks. Now we actually will use the same form type, an expense type of form. We're just going to use it in a little bit different way, one you might be guessing right now because we have done a familiar or similar process here in the past. So let's do this. We're going to go up top. We're going to say now, we don't have any really anybody to write the check to. So we could say miscellaneous again, because again, we're kind of using this to have a zero balance. It's not going to be affecting the checking account. So I'm going to write this then to the clearing account this time, because again, this is going to be a clearing journal entry, it's not actually going to be decreasing the checking account in any way. So I'd like to put it in the clearing just to indicate that. And then I'm going to put the methods going to be cash. So we'll do the cash again. And then down below, we're going to start off with the items, do the items the same way. And then we're going to go to the category to make the other side of the transaction. So the items are recorded in the expense, depreciation expense. Then the category will record the other side, which will be the accumulated depreciation. Okay, so let's do that. We're going to do the same process here, same items to start off with. So we're going to say this is going to be depreciation, a new item. So I'm going to say add that tab. We're going to add this item. It's going to be a non-inventory item. I'm going to copy the depreciation name. I'm going to be putting that in the description down below. We're also going to be putting it into the purchase and the double-sided item. And then I'm going to make a new account called depreciation. And I'm going to call this depreciation job or factory, I should call it or something like that to differentiate. And then I'm going to say tab. It's not going to go to an expense account, but rather to a cost of goods sold account. And we want to make this, I'm going to make this other. And then on this side, I'm going to make it a sub-account. So we're going to make it a sub-account of the overhead once again, sub-account of the overhead. So same process, save and close. And then now we're going to save and close the item. So there we have that. There's the depreciation. Let's put in our amounts now, which are going to be 5,700. This is going to be a billable item and job number 14. All right. And then we've got depreciation. We'll do this again, depreciation. And this is going to be 4,900. That'll be billable. And it's going to be job number 15. Job number 15, job number 15. Then we're going to do it at the end. Depreciation again. There it is. And this is going to be for the amount of 14400. And that's going to be billable as well. So we'll say it is billable, yes. And job number 16, job number 16. That adds up to our 30,000. If we left it like this, we'd have 30,000 up top. And we're not paying anybody for depreciation. So these amounts, these items below will properly record it to the expense account that we want and allocate it to the job. But the other side needs to go to accumulated depreciation for which we will use the category detail up top. And then we're going to say the category should be accumulated depreciation for the negative 30,000. This one's not billable and we're not going to assign a customer to it. All right. So I hope we did all this correctly. I'm going to say save and close. I'm pretty sure we did. I feel good. I feel good, but we're going to check it out now. So I'm going to say save and close and let's go on over to our reports. We're going to go to the reports on the left hand side starting off of course with the balance sheet report. Let's open up that balance sheet report and see what we have thus far. Let's close up the old hamburger up top. I'm going to hold down control and scroll up to get up to that 125. That's where I like to be even though they give me this little warning to reset stuff. But I think it's okay. So we're going to be down here and we can go into the checking account. If I go into the checking account, we can see that the checking account has gone down drastically for the amounts that we have paid and we have our checks that we have written here. If we were to select one of them, let's pick this 20,000 item, 20,000. That's going to take us to of course our expense, this one being for the rent. So those items coming out of the checking account. So then if we go back up top and go back to our balance sheet report, we also note that we have the fixed assets. We have the accumulated depreciation, which was recorded. If I go into that accumulated depreciation, you see the amount that was recorded here with our expense form. So that looks good. And that was the 30,000 related to it scrolling back up. Let's go on back to our balance sheet and then let's open up our income statement. So let's go up top to our tab up top, right click on that tab, duplicate that tab, putting the balance sheet on the right, then go back to the left so we can open the income statement by opening first up the hamburger, then go into the reports down below, then we're looking for that P and L, that profit and loss, that income statement. So I'm going to hold down control. There it is, I don't have to minimize the screen. I was going to make the screen smaller to see it, but I don't need to do that, it looks like. Then we'll close up the hamburger here, closing up the burger. And we can then see down here, if we look at the detail, notice the dates, of course, I'm in 2020. So as long as we're in January 2020 and beyond, we should be okay. So then we have our cost of goods sold. If I was to minimize the cost of goods sold, that now is at the $674,000. Does that match what's on our Excel worksheet? And it does, there's the $674,000 in the cost of goods sold. That's only the current data, the current information for 2020. And then if I go on back over and we were to expand this, if we were to expand this now, I can then see our subcategories in cost of goods sold, including the direct labor, the direct materials, and the overhead. So there's the direct labor, direct materials, and the overhead. If I was to expand, say the overhead, now we've got our detail within the overhead and we could break out the different categories within overhead, which we can, of course, do as well with the direct materials. So you can see all the detailed information we have there. Then we can break this out by job. Or, and so if I select the dropdown, I can go buy customer now. So if I go buy customer and I run that report once again, then we can see our jobs. That's gonna be 14, 15, and 16. So same kind of detail. We could see our detailed information. I'm gonna minimize the materials and the overhead for job 14, 15, and 16, totaling up to that 674,000 for the total on all the jobs in the income statement. That's all we have right now is this job information that should tie out then to the balance sheet in the equity section. That's gonna be the 674,000 here. Let's go back to the income statement. Now, what if I wanted to see the full open jobs? Then I can go back to 2019. Let's bring this on back to 2019 and run that report. And we should get all the detail for all the open activity for the lifespan of the job. That now adding up to 191. Let's minimize these here. I'm gonna minimize the materials and the overhead. So job number 14 totals out at 191, 140. Let's just check our numbers here. So this totals out at the 191, 140, which ties our Excel worksheet. And then if we go back on over the second job, job 15 is 314, 980. So 314, 980, that looks good. Let's then go to job number 16. And that is gonna be for the 250, 880. So the 250, 880, that's good. Let's look at these sub categories of them. Job 14 has labor 48, materials 114, and overhead 29, 140. So if we go back on over, we've got the 114 direct labor, the 48, or direct materials labor, the 48, and the factory overhead, the 29, 140. And then job 15 has direct materials 188,000, direct materials 84, overhead 429,80. If we go then to the second job, we've got labor 48,188,000 for the materials, overhead 429,80. Finally, job 16, labor 120,000, 80,000 for the materials, overhead 50,880. So if we go back on over here for the last job, we've got the 80,000 direct materials, 120,000 direct labor, and the factory overhead at the 50,880. So I think we're good. I went over that a little bit quickly, but I think that works. Okay, so now let's right click on this tab up top. I'm gonna right click on this tab again, duplicate that tab, then go back to the tab to the left. And you can also open up the hamburger over here and just consider this information within the projects screen. So I'm gonna hold down control, scroll down just a bit to get down to that 100% now. Then we can go into the projects, see it a little bit better, close up the hamburger once the projects are open. Then I like to go down even a little bit smaller because that allows me for my computer screen to see our different jobs. I'm gonna go then into job number 14. Within job number 14, you can see of course the more data from a job by job perspective. We're now at the 191,190. Here's the direct materials, kind of little breakout for you here and the overhead. And then you can go into the more information with the project reports into each job by job format. Remember, it's nice to be able to break out and look at all the open jobs and be able to kind of tie out the information in the format of seeing the total jobs. So you can run the report to see the total job activity and then break out the beginning balances so that if you needed to kind of do a conversion at the end of the year to be in a completed contract, or a percentage of completion basis, you can then make some adjusting entries possibly as needed to break out that information into something like a work in process account and or finished goods accounts if those are needed. So that's gonna be it for now, let's get out of here.