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Labor Allocation Question

Discussion in 'Business Operations' started by heybruck34, Apr 15, 2009.

  1. heybruck34

    heybruck34 LawnSite Senior Member
    Posts: 300

    How do you guys allocate labor to each job? Materials is easy but for those of you that have crews- do you charge the employee labor to the actual jobs? What is your process?

    Say you do 2 jobs- Smith and Jones. 1 receipt for 20 bales of pinestraw at Home Depot. 15 bales for Smith and 5 bales to Jones. You can code this receipt very easy and allocate to the two jobs.

    The 2 employees who did both jobs each worked 30 hours and got paid 300 each for that week. 20 hours at Smith and 10 at Jones. Total payroll 600 for the week (to keep it easy). When your payroll package shows up, how do you allocate the $600 so that their labor gets charged to the 2 jobs?

    No dumb replies OK- this example is easy. I'm trying to come up with a system to allocate a dozen employees doing maintenance, install, fertilization, etc,. I have an accounting degree so the data entry is easy- the SYSTEM for getting the accurate information efficiently is my question.

    SO- How does your operation work? Does the crew leader/supervisor allocate the time by job for entry into the computer? Who approves the material invoices/receipts? How does the labor and material make it to COGS for each job?
  2. heybruck34

    heybruck34 LawnSite Senior Member
    Posts: 300

    no one tracks their labor by job to know whether they really made a profit or not?

    If no, how do you guys track your labor- one Salaries & Wages account?

    CLARK LAWN LawnSite Silver Member
    Posts: 2,526

    i dont think anyone really understands your question, i know i dont.
  4. barefootlawnsandlandscape

    barefootlawnsandlandscape LawnSite Senior Member
    Posts: 296

    If we have mulitple locations of the same tasks, we will track cost by the day. We also track time efficiency when a crew is servicing multiple locations i.e. mulching, mowing, enhancement, irrigation maint.

    We try and never make a crew change tasks during a day unless an emergency arises.
  5. Fvstringpicker

    Fvstringpicker LawnSite Fanatic
    Posts: 7,603

    What you're talking about is job cost accounting. The only reliable way to track direct labor is the record the actual hours on the job. You can allocate indirect labor based on this since its logical that supervision and management is directly related to labor.
  6. bohiaa

    bohiaa LawnSite Fanatic
    Posts: 5,220

    The best way to do it is to have a computer program that keeps it for you.

    Your right, sometimes you dont pay taxes on this job or that job, and sometimes this job you will have to pay more taxes.
    and your expence will be higher on this job than that...

    we have unincorprated areas out here where I'm at. this makes sales tax at 5.24%
    while in citys it's 8.24 and County is 6.24%

    it's a nightmare sometimes. also the fuel charge.... theres a diffrence there aslo..

    however. unless this is a ton of money. I dont worrie about it.

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