Industry Accounting BlueprintContractor job-costing and retainage conventions

Construction & General Contractors Chart of Accounts

Name: Construction & General Contractors QuickBooks Online Chart of Accounts Template
Creator: Ledgerbrook
License: https://creativecommons.org/licenses/by/4.0/

A construction chart of accounts must separate direct job costs into 5000-series accounts (Labor, Materials, Subcontractors, Equipment) from general overhead. Critical balance sheet accounts include Retainage Receivable (1150), Retainage Payable to Subcontractors (2110), and Costs in Excess of Billings (1300) / Billings in Excess of Costs (2120) for percentage-of-completion compliance.

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QuickBooks Online Ready CSV

Includes all 41 numbered accounts, types, and official QBO detail types.

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Industry Gotchas

Key Accounts Most Bookkeepers Set Up Incorrectly

Account #1150Other Current Assets

Retainage Receivable

Why It Matters:

Tracks withheld contract payments (typically 5%–10%) until project substantial completion and punch list sign-off.

⚠️ Common Mistake:

Booking retainage as bad debt or ignoring it, causing gross billing misstatements on AIA G702 applications.

Account #1300Other Current Assets

Costs in Excess of Billings (Underbillings)

Why It Matters:

Captures unbilled project costs incurred on percentage-of-completion contracts.

⚠️ Common Mistake:

Expensing all job costs immediately without deferring unbilled WIP, severely distorting monthly P&L swings.

Account #2110Other Current Liabilities

Retainage Payable to Subcontractors

Why It Matters:

Tracks amounts withheld from subcontractor progress billings pending inspection and release.

⚠️ Common Mistake:

Paying subcontractors in full before receiving conditional lien waivers and architect approval.

Account #5030Cost of Goods Sold

Subcontractor Expense (1099)

Why It Matters:

Isolates 1099 subcontractor payments directly attributable to active job sites.

⚠️ Common Mistake:

Lumping subcontractors with in-house payroll wages or office repair contractors.

Account Hierarchy

Complete Construction Account Tree

Code	Account Name	QuickBooks Account Type	QuickBooks Detail Type
1010	Operating Checking	Bank	Checking
1020	Payroll Checking	Bank	Checking
1100	Accounts Receivable	Accounts Receivable (A/R)	Accounts Receivable (A/R)
1150	Retainage Receivable	Other Current Assets	Other Current Assets
1200	Inventory - Direct Materials	Other Current Assets	Inventory
1300	Costs in Excess of Billings (Underbillings)	Other Current Assets	Other Current Assets
1400	Prepaid Commercial Insurance & Bonds	Other Current Assets	Prepaid Expenses
1510	Commercial Vehicles	Fixed Assets	Vehicles
1520	Machinery & Heavy Job Equipment	Fixed Assets	Machinery & Equipment
1590	Accumulated Depreciation	Fixed Assets	Accumulated Depreciation
2010	Accounts Payable	Accounts Payable (A/P)	Accounts Payable (A/P)
2020	Commercial Credit Card	Credit Card	Credit Card
2110	Retainage Payable to Subcontractors	Other Current Liabilities	Other Current Liabilities
2120	Billings in Excess of Costs (Overbillings)	Other Current Liabilities	Other Current Liabilities
2210	Payroll Liabilities	Other Current Liabilities	Payroll Tax Payable
2220	1099 Backup Withholding Payable	Other Current Liabilities	Other Current Liabilities
2510	Heavy Equipment Loans Payable	Long Term Liabilities	Notes Payable
2520	Vehicle Loans Payable	Long Term Liabilities	Other Long Term Liabilities
3010	Owner's Capital	Equity	Owner's Equity
3020	Owner's Draws	Equity	Owner's Equity
3030	Retained Earnings	Equity	Retained Earnings
4010	Contract Revenue - Progress Billings	Income	Service/Fee Income
4020	Change Order Revenue	Income	Service/Fee Income
4030	Time & Materials Revenue	Income	Service/Fee Income
5010	Direct Job Materials	Cost of Goods Sold	Supplies & Materials - COGS
5020	Direct Field Labor	Cost of Goods Sold	Cost of Labor - COS
5030	Subcontractor Expense (1099)	Cost of Goods Sold	Cost of Labor - COS
5040	Job Site Equipment Rental	Cost of Goods Sold	Equipment Rental - COS
5050	Municipal Permits & Engineering Fees	Cost of Goods Sold	Other Costs of Service - COS
5060	Dumpsters & Job Site Cleanup	Cost of Goods Sold	Other Costs of Service - COS
5070	Job Site Safety & Small Tools (< $2,500)	Cost of Goods Sold	Supplies & Materials - COGS
5080	Freight & Direct Delivery Charges	Cost of Goods Sold	Shipping, Freight & Delivery - COS
6010	Advertising & Bid Marketing	Expenses	Advertising/Promotional
6020	Merchant & Bank Wire Fees	Expenses	Bank Charges
6030	General Liability & Workers Comp Insurance	Expenses	Insurance
6040	Estimating Software & Office Supplies	Expenses	Office/General Administrative Expenses
6050	Professional Fees - Legal & Accounting	Expenses	Legal & Professional Fees
6060	Shop & Storage Yard Lease	Expenses	Rent or Lease of Buildings
6070	Utilities & Mobile Communications	Expenses	Utilities
6080	Overhead Vehicle Gas & Repairs	Expenses	Auto
7010	Business Loan Interest Expense	Other Expense	Other Miscellaneous Expense

Reconciliation Rules

Monthly Sanity Checks for Construction Files

✓Tie out Retainage Receivable and Payable against open customer and sub AIA progress billings.
✓Verify Work in Progress (WIP) schedules against project milestone percentage-of-completion.
✓Reconcile 1099 subcontractor payments and confirm valid Certificates of Insurance (COI) on file.
✓Clear unassigned job costs from general cost pool to specific customer project numbers.

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Frequently Asked Questions

Construction Chart of Accounts FAQ

How do I import this Construction chart of accounts into QuickBooks Online?

Download the pre-formatted QBO CSV file using the button on this page. In QuickBooks Online, click the Gear icon -> Import Data -> Chart of Accounts. Upload the CSV, map the columns (Account Number, Account Name, Type, Detail Type), and click Import. Ensure account numbers are enabled under Account and Settings -> Advanced -> Chart of accounts.

What accounting standard does this Construction chart of accounts follow?

This chart of accounts is designed around the Contractor job-costing and retainage conventions. It groups direct operating costs, tax-sensitive accounts, and subledgers to ensure accurate gross margins and CPA tax preparation.

Can I customize this template for my specific business or firm?

Yes. Once imported into QuickBooks Online, you can add sub-accounts, rename categories to match vendor naming conventions, or delete unused accounts without breaking the core financial reporting hierarchy.