General Inquiries

Shop Cost Allocation

  • 1.  Shop Cost Allocation

    Posted 12-27-2018 16:11
    Does anyone have a good solution for allocating shop costs to jobs in Vista? We create "invoices" in excel and send them to PM's via email for approval/coding then do a job cost entries, but emails get lost (ignored) and the process is very manual. Thanks!

    Samantha Nickerson
    Manning Squires Hennig Co., Inc.
    Batavia NY

  • 2.  RE: Shop Cost Allocation

    Posted 12-28-2018 09:04
    We build our shop overhead costs directly into the internal revenue rates of our equipment in Vista.  Our revenue codes are broken down into three codes:  1) Repairs  2) Fuel, Oil and Operating and 3) Overhead. When hours on a piece of equipment are recorded (through payroll or other), the revenue rate is charged to the project and the shop is given credit for the resulting revenue.  The internal rates are reviewed annually  and this process includes reviewing the overhead allocation.  Normally, our revenue rates are set up by category which simplifies any updates to the rates.

    Jackie Farasyn
    The Mathiowetz Construction Company
    Sleepy Eye MN
    (507) 794-6953

  • 3.  RE: Shop Cost Allocation

    Posted 12-28-2018 11:06
    Have you looked at JC Allocations? Let's say direct labor is the basis. You can automatically allocate an additional 5% of direct labor to cover shop costs. This only requires a one time set up of the code and then someone kicks off the process monthly. You can also accomish this on the liability template and it will not the jobs as labor hits the job.

    If there's some other basis, like revenue, you can do that in JC Allocations as well.

    Sarah Stegman
    Director - Construction Software Consulting
    CohnReznick LLP

    (469) 371-7209

  • 4.  RE: Shop Cost Allocation

    Posted 12-28-2018 11:38

    I would recommend setting up your allocation to match how you bid for the shop cost in your estimates. If you add a percentage of labor in the estimates, then use the same basis in Vista. If your estimates use hourly or monthly equipment rates, then adjust your hourly or monthly rates to include all of the general shop overhead as mentioned by Jackie.

    If your allocation basis is labor, you could use JC Liability Templates to process the allocation with Payroll. Sarah mentioned using JC Allocations which gives you more flexibility on the basis, but must be processed separately.

    Your credit account should generally be a contra account (i.e. 6999 - Equipment Costs Applied).

    Kevin Halme
    Constructive Tech Solutions
    Omaha, NE

  • 5.  RE: Shop Cost Allocation

    Posted 01-02-2019 15:42

    We use Sage 300 and are having the same problem in not knowing exactly how to allocate expense to the jobs as in depreciation , vehicles  and  expenses, safety , computer licenses, human resource, administration expense etc.  Also how are the costs allocated, as a percentage of the job? Is there any help or class  out there in a step by step instructions on how

    To accomplish this? In other words how to decrease the expense on your income statement  and move that expense  to your jobs. I would appreciate any suggestions from the group.

    Cala Habel


  • 6.  RE: Shop Cost Allocation

    Posted 01-03-2019 06:48

    To handle the direct costs from our pre-fab shop, we created a phase code in the Phase Master.  The shop foreman codes the crew time to the jobs, any job without this code gets it added.  We charge it directly to the job this way.  If your question is more about indirect shop costs, I recommend just doing a standard allocation using manhours or revenue or other indicator of shop use.


    Ralph "Scott" Luman

    CFO | AES Electrical, Inc. | Freestate Baltimore, LLC

    Ph: 301-572-0131 | Fax: 240-294-5562

  • 7.  RE: Shop Cost Allocation

    Posted 01-03-2019 10:56
    We use an overhead allocation percentage based on labor dollars, which is evaluated annually to avoid over or under burdening our job costs over time similar to allocating overhead to products in a manufacturing setting, to apply indirect costs such as depreciation, repairs and maintenance, etc.  We don't try to apply this method to allocating all operating costs such as administration wages and other administrative expenses.

    Erik Wakeling
    Knight Construction & Supply, Inc.
    Deer Park WA
    (509) 276-2229