Industry guide
Construction and trades bookkeeping
Construction and trade businesses need job-level visibility across materials, subcontractors, labor, deposits, progress billings, retainage, and equipment.
Reviewed by the Booksmrt bookkeeping teamLast reviewed 2026-07-27
What the monthly close has to prove
- Apply consistent job and cost codes to direct activity.
- Reconcile customer deposits, progress invoices, and collections.
- Track subcontractor bills and payment records.
- Separate repairs, supplies, tools, vehicles, and equipment under approved policies.
Documents to collect
- Customer contracts and invoices
- Vendor and subcontractor bills
- Bank and card statements
- Payroll and job-cost reports
- Equipment purchase records
- Change orders and retainage schedules
Common failure points
- Deposits treated as final revenue without context
- Materials and overhead mixed
- Loan principal posted to expense
- Equipment purchases fully expensed without policy review
- Job profitability unavailable
Example
A $25,000 customer deposit affects cash immediately, but the revenue timing depends on the accounting method, contract, and work performed.
Sources
Keep learning
Gross profitGross profit is revenue minus the direct cost of producing the goods or services sold.AssetAn asset is a resource controlled by the business that is expected to provide future economic benefit.ExpenseAn expense is a cost recognized in earning revenue or operating the business during a period.Accounts payableAccounts payable is money a business owes vendors for goods or services already received.Accounts receivableAccounts receivable is money customers owe a business for goods or services already delivered.
Educational information only. Booksmrt provides bookkeeping services, not tax, legal, audit, or investment advice. Confirm material accounting and tax decisions with the appropriate professional.