Overhead costs such as administrative costs, labor overhead, miscellaneous supplies, or other costs should be considered in a job costing system to report accurate cost comparisons. The most common method of allocating overhead costs is to add a percentage only to the actual direct costs but not to the budget. The budget amounts added in the job proposal or change orders should include the margin required to cover overhead costs.
EBMS does give the user the option to add the percentage overhead costs to the budgeted amount in situations where the budgeted costs entered within a proposal do not include the margin required to cover overhead. This situation would occur if the proposal lists actual product and labor costs without any overhead margin.
Complete the following steps to add the same overhead percentage to the budget as the actual costs:
Select Job Costing > Options > Stage
Classifications tab from the main EBMS menu.
Select a classification and click Properties.
Enable Add Overhead To Budget to add the overhead percentage to all stages set with the selected classification.
Click OK to save. Repeat for other classifications.
Review Classifications for more details on creating classifications and setting options.
Note that the following values will be blank if the Add Overhead To Budget option is disabled.
The Budget >
Costs > Overhead value within the Budget tab of a job will be
blank if the option is disabled for all classifications for this job.
The Budget > Overhead value within
the Totals tab of a job stage will be blank if the option is disabled
for the stage classification.
