Cost code

A cost code is the identifier that categorizes a specific type of cost — a labor hour, a material purchase, a sub invoice — to a standard budget category so it can be tracked and compared across jobs.

Cost codes are what make job costing possible at all. Without them, every expense on a job is just a line in an accounting system with no connection to the estimate that predicted it. With them, 'concrete labor' or 'electrical rough-in' means the same thing on every job, so this project's actuals can be compared to the estimate — and to the last ten projects like it.

Most small shops either don't have a cost code structure or have one that doesn't match how they actually estimate, which means the two systems — estimating and job costing — never talk to each other.

Example

A GC codes every timesheet entry and material receipt to a standard list: 03-100 for concrete formwork, 16-050 for electrical rough-in, and so on. At any point, they can pull actual cost against estimate for 03-100 across every job that used it.

Related terms

Job costingJob costing is tracking actual labor, material, and overhead costs against the estimate for a specific project in real time, so you know whether it's making or losing money before it closes out.WIP reportA work-in-progress (WIP) report compares billed-to-date against earned revenue on every active job, surfacing over- or under-billing before it distorts a company's cash position.Schedule of values (SOV)A schedule of values (SOV) is the cost breakdown of a contract by line item — the basis every progress payment is measured against, showing percent complete per item.

Next step

Where this shows up in Datumel:

Job-Costing Workbook InstallFrom $6,000 one-time

A configured job-costing workbook in your own Sheets or Airtable: cost codes, estimate-versus-actual, WIP, and over/under billing, with training to run it.

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