 In this presentation, we'll take a look at the process of entering a job or project estimate. Let's get into it within two weeks. QuickBooks online. Here we are in our job costing company dashboard. We're going to go down to the projects now and we're going to think about the estimating process. Now, obviously the estimating process would happen before typically we start the job, but we want to look at it at this point so that we can compare it to the entering of the data. I'm going to hold down control, going to scroll down just a little bit so we can see our jobs down here. Now we can only see 15 and 16 because I only have the in progress jobs. I'm going to open up this item and I want to look at all jobs and I'd like to look at job number 14 because that's the one that's been completed so we can do the fullest comparison of the estimate entering process versus the invoice entering process. So I'm going to go into job number 14. So we can see the activity that happened through the process. We have the income, we've got the costs, and we've got the profit. So we've obviously entered all this information into it already. Let's think about the estimate process and that would usually happen when we create a new job and we can kind of compare it to the process that we have going through now including basically the invoicing process. So if I go to the dropdown up top and I say add a project and then we go down to the estimate. So we're going to be estimating here. So we're going to go to the estimate field and we're going to be taking a look at the project for project number 14. Now you'll note, of course, the estimate looks a whole lot like the actual invoice. It's going to be a similar kind of process. We're going to be entering this information into the estimate, the main difference being this is happening before we've actually done anything and therefore it's going to be just an estimate, not something that we're going to be used to be billing the client with. Now we also have the statuses down here, which is a little bit different than a standard invoice. So the default would be pending and then accepted. So if this was an estimate and then it was accepted, then we can track that this estimate has been accepted and the job is moving forward, then closed having the estimate to be closed and then if it was a rejected estimate, we don't have to delete the estimate. We can keep it in the system as a rejected estimate. So then I'm going to go through here. We'll keep it as pending. We've got the email. We've got the customer. It's going to be customer one, even though we're talking about job or project number 14. We're going to say this happened as of 01, 01, 2, 0, because that's going to be the beginning of our, our period. I'm not going to put the expiration here, estimate number. I'm going to keep it as the default, which is populating automatically. Then we're going to enter our information in a similar way as we would with the invoice. So it's going to look similar to the invoice. I'm going to be entering basically the line items. So the first one was cement. So I'm going to put the cement render and we're going to estimate this time that the cement render, let's say is 7,500. So we're doing our estimates. Obviously we would have, we would need a professional, professional estimator to help us to determine what we believe the costs will be if there's something like a bid or an estimate. We're going to have the drop ceiling. We're going to say that was 5,300. We're going to then say that we have a flooring and we're going to pick that one up and that's going to be, we're going to say that we believe that one's going to be 1,200. And then we have, we're going to say direct labor. So direct labor, we think that that's going to be, let's say 19,000. We think that the factory overhead, factory overhead, which we might use for the predetermined overhead rate is the way we might be figuring that. It's going to be 8,500. And then we have the cement render, cement render. And I thought I already had cement render and we had it twice here. I'm going to put it in here again. We got 14,000 and tab, tab, tab. And then wood finishing. So we're going to say wood finishing. And that's going to be for, we're going to say 7,000. And then I'm going to be picking up the wall covering, wall covering here. And that's going to be for 11,300. And then we've got the stucco. So I'm going to tab through there stucco, tab, tab. That's going to be the 14,600 and tab, tab, tab. Then we're going to have the paint and wood stain. So paint and wood stain. So we'll tab through that. That's going to be for, we'll say 14,000, tab, tab, tab. Then we have the marble. So we'll pick up the marble. And that's going to be for, we're saying 21,000 and tab, tab, tab. Then we've got the flooring, flooring, F-L-O-O-R. And that's it. So we're going to pick that up. And we're going to say that that's going to be 15,000 and tab, tab, tab. Then we have more direct labor, direct labor. And we're going to say that that is 25,000. We're going to be picking up then indirect labor, indirect labor. And we're going to say 2,000. And then indirect materials. I'm going to be picking up at 6,000. And then we're going to be saying that we'll tab through here. Tab, tab, tab, indirect materials. And then we have utilities. We're going to be picking up. That's going to be part of the overhead of the 3,000. And note, the reason we have some of these things in here twice is because we had the beginning balance that we entered into the system. And I'm picking this up basically for the invoice. And then we have the stuff that happened during the period. So you might consolidate the direct labor and the direct labor so you don't have it in there twice, of course, for the estimate. But I'm basically picking this up from the invoice so that we have a comparable item. So then we have the rent. So I'm going to pick up the rent, which is a variant of the overhead once again. And so the rent amount. And notice I've been putting these into, this should be 1,021,000. I'm going to tab, tab, tab, tab, 1,015,000. Tab, tab, tab, tab, 1,025,000. Tab, tab, tab, tab, tab, and then 1,002,000. Tab, tab, tab, and then 1,006,000. Tab, tab, tab, tab, and 1,003,000. All right. And now we're on the rent, which is 1. And we're going to say 4,000. And then we've got depreciation. So depreciation. And we're going to estimate that to be, we'll say, 1 and 6,400. All right. And then we've got the markup. And then the markup, which is a 30% markup. So if this was going to be our cost then, the 277.9, if that's our estimated cost, then we would consider our markup pulling out the old trusty calculator. It's going to be the 277.9 times the 0.30, or 30%. You would think that would be then, or that would be if that was the case, the markup of the 83370. And so that puts us at the 361, 270. So I'm not sure that's a little pretty far over what our actual was, though. But any case, I'm going to keep that for now. So that's going to basically be our estimate, the estimate that we have put into place here. Now, when we think of the estimate, you could think of it a few different ways. Obviously, this could be something that could be an estimate for the job to see if we can then get the job. And then there's questions as to whether how hard the estimate is. In other words, is this an estimate that we're going to stick to no matter what the actual cost is, or are we going to actually go by the actual cost and then do the markup from that point in time? So you could then create, obviously, your invoice based on, and there's just a few other places where I kind of messed up here. This should be, but I'm just going to leave it. I'm not going to adjust it. We've got the zero amounts over here, so just realize that if I mess that up, sorry about that. But in any case, just realize that you can then say if it's a hard estimate, then once you complete the job, then of course you can bill whatever your billing rate is as you go. And your billing would be based on the estimate here rather than what we did, which was actually to use the actual billable items to pull over the invoice and then say, hey, look, this is what we think it's going to be, and then we're going to do what we're going to actually do, which will be the actual cost and the 30% markup. So there's obviously plus and cons to either method you're going to use. If you're more solid on the estimates, if your estimates are really good and you can make a solid estimate and you're not going to have that deviation because there's a solid change in the contract, the agreement that's going to be made, the estimates can give a lot of assurance. That kind of system can give a lot of assurance to the customers, because obviously as a customer, you're going to be worried that the actual cost is going to be greater than the estimate. So then the estimates aren't worth that much if you can't trust the estimate. But however, of course, if the estimate is you're estimating something that's got a lot of variant in it, a lot of preference in terms of the customer, then you're going to want to say, hey, this is what we think it's going to be, but it could vary from that, depending on what your personal preferences are and choices are and whatnot. And so we're going to base the contract based on what actually happens and then has to have a 30% markup. So it depends what it's going to work, but obviously this could be something then that you would use to populate the invoice if that's the system you were going to use. Or again, you could do it the way we did it, which is basically billing the information and then using that billable information to populate the invoice. So I'm going to go ahead and save this. I'm going to say save and close. Now if we want to view the estimate then, we can go to the transactions. I'm going to go to the second tab here with the transactions. And I'm going to sort the transactions or we could filter the transactions by basically the estimate. So I'm going to filter the transaction. We're going to go to the items here. Now I'm going to just look for the open estimates. So I'd like to see the open estimates because I left it open there. And then I'm going to say okay. And then there's our estimate. So we can then open up our estimate from here and take a look at that estimate. And so here's our actual estimate. Once again, if I close this back out, it's loading up a little slow, but that's okay. That's my fault. It's my computer's fault. I'm going to close this back out. And then of course, we can create an invoice. And if we were to create the invoice, we can populate the invoice basically from the estimate. Our options being then the remaining total of all lines or we can say 50% of each line or custom amount for each line. So in other words, if you had a completed job here and now you want to bill for the entire job, then you can say I want the remaining amount for all the lines if we haven't done any billing up to this point in time. Or we can say take some kind of percentage such as 50% of each line item if we're doing some kind of progress billing system or we can have some kind of custom amount that's going to be provided for each line. So if we keep it at the top one, then I'm going to say I want the remaining amount. I'm going to build the entire thing. We're going to then create the invoice. And so it's going to populate the invoice. And now we have an invoice that looks a whole lot like the estimate, right? We created the invoice from the estimate. You can see the link here. If you were to go to that, there's the estimate that it's going to be linked to. Now if we go down, it's indicated by these little chains, these little links mean that it's linked to the estimate. And obviously it's populating this information on the invoice based on the estimate and we get down to our total down below. So note, we already did this. We already invoiced the client and we did so through the billing process rather than pulling the information from the estimate. So it just depends how hard is the estimate? Is the estimate a hard estimate that you're going to use for sure? Then you can use the estimate to pull through to the invoice. If it's not a hard estimate and you'd rather actually bill based on the actual cost in some way, shape or form, then you can use that billing process as we did throughout the problem. So those are an options here. I'm going to close this back out. And do you want to leave without saving? Yes, I'm not going to actually save that because that would be billing twice because we used the other method to do so. Obviously if you went and you unfiltered this, I'm going to go back in and I'm going to see all transactions and apply all transactions. You'll remember and recall that we made the invoice here and we made the invoice that was based on the bill information. So if I was to view and edit, so if we go view and edit the invoice that was actually made, it looks like this and it was pulled over from the actual items, the actual billable items with again that 30% markup at the bottom. So I'm going to go back up. I'm going to close this amount out. So note you could do that comparing the invoice and the actual or the invoice and the estimate and the actual cost as you can see here as we're tracking the actual costs. We don't see a report at this point in time and hopefully they're going to be providing one at some point which would be an easy comparison report of the actual versus the estimate, the estimate versus the actual. What you can do for a similar kind of comparison actual versus estimate is create budgets. So you could go through the budgeting process and that would be with the gear up top and you can then create budgets and there are budget versus actual types of reports. So if you were to go into the budgeting process you can add the budget here and go through that process. I'm not going to go through that in detail but just note that is an option as well. So that's going to be it for now. Let's get out of here.