Lawyers and CPA's

Discussion in 'Business Operations' started by LakeCountry, May 21, 2001.

  1. I pay my accountant $200 per month to run my corporate financial statements once per month, balance checkbook, do sales tax reports for state and 2 other cities, general phone advice 2 times per month usually, and file appropriate corporate documents at the right time. I am happy to pay him as I am tired of wearing all these hats, my neck hurts from it.
  2. HBFOXJr

    HBFOXJr LawnSite Bronze Member
    Posts: 1,712

    WE do out own bookeeping and payroll and pay a CPA to do the business & personal tax prep once a year. Cost a few hundred and thats it. I have everything business and personal computerized so data is a cinch.

    One caution and you should consult with a tax preparer/cpa before your computer setup. Contracting/service is a differnet animal from the financial analysis aspect than retail. You must structure your cost accounting & possibly chart of accounts different.

    I'd also say spend money on a bidding and estimating seminar (2 day) by Chuck Vander Kooi or Jim Huston. It will be the best and most important money you can spend early in your career. Those that haven't done one or are unwilling to spend the money don't understand how expensive ignorance (lack of knowledge) is. One job bid right rather than wrong can pay for the seminar AND you get to keep the knowledge for every job ther after.

    Charles VAnder Kooi

    Jim Huston

    What is screwy about some accounting organization is what is considered overhead. In our business overhead is all the non production costs that keep a businesses doors open every day wether you sell or do any work or not. Overhead may also be known as indirect expenses as theyare not tired to a specific job. These expenses

    Other expense may be known as production expenses or direct expenses because they can be directly tied to actual work done. Examples would be all production equipment including vehicles and expenses to aquire and operate them, labor to do the work and all expenses related to labor including insurances like liability, workmans comp etc whose premiums are tied to payroll and lastly the job materials and subcontractors that are used to perform work.

    Keeping records this way makes it easy to calulate your break even point, equipment costs per man hour, overhead costs per man hour, etc. I also pay my guys in production and non production hours such as rain days in the shop, vacation, sick or whatever. Then all you must do to find your labor costs is total your production hours both regular and overtime, then use that number to divide into overhead or equipment costs to get your cost per production man hour. You can also divide into your gross payroll to find the real cost per hour or into the other labor costs such as the insurances, uniforms, help wanted advertising, employer taxes etc to find out your "labor burden per hour".

    I recommend you do these things initially because it will make growth easy because there will be no unknowns and the system will be in place.

    And buy a stop watch or a Timex with the function so you can keep track of production time for phases of a job. Since labor is always the big unknown you can know yours.

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