How to Use Project Costing
Track estimated vs. actual cost on every project, line by line, so overruns show up while you can still do something about them.
- Who can use this
- Anyone with permission to view project financials.
- What the client sees
- Project costing is internal. Clients never see cost, markup, or variance.
Before you start
- An approved estimate that created a project
Open the costing view
- Open the project and click the Project Costing tab.
- You'll see every estimate line item plus any change orders, with budgeted amounts.
- As work happens, log expenses against each cost line — materials, subs, and labor.
- Actual and Variance update in real time; over-budget lines are highlighted.
- Use Add cost line for anything unplanned (rentals, dump fees, surprise materials).
Reading the numbers
Each cost line carries the revenue it earns and the cost you planned for it. The totals bar at the bottom sums the whole project.
- Actuals to date — what you have actually spent: expenses tagged to the line plus approved labor hours.
- Projected cost — each line finishes at the higher of its budget or its actuals, so a line already over budget can never look fine.
- Cost to complete — projected cost minus actuals: what is still to be spent.
- Projected profit — revenue minus projected cost.
- Margin — projected profit as a share of revenue, not a markup on cost.
- All costing figures are pre-tax. Sales tax is handled on estimates and invoices and is never in these totals.
A worked example
A tile line sold for $10,000 was budgeted at $6,000 of cost, and $6,500 of expenses have already hit it.
Projected cost is $6,500 (actuals, because they exceed the budget), cost to complete is $0, projected profit is $3,500, and margin is 35%. If instead only $2,000 had been spent, projected cost would still be $6,000, cost to complete $4,000, projected profit $4,000, and margin 40%.
Change orders on the costing tab
- An approved change order's lines appear as their own group, so added scope never hides inside the original budget.
- Contract amount is the approved estimate plus every approved change order; a negative change order reduces it.
- A change order still in draft or sent is not in costing yet — only approved ones are.
Habits that keep it accurate
- Tag expenses to the right cost line the day they happen.
- Review the costing tab weekly so you can still talk to the client about overruns.
- Write a change order before you spend on new scope, not after.
Troubleshooting
Two line items with the same name look merged.
They are tracked separately by line, not by name. Rename them if you want the report easier to scan.
An expense isn't showing in Actual.
Confirm it's attached to the project and to a cost line, and that it isn't still a pending receipt.
Projected cost is higher than the budget you typed.
That is intentional: a line that has already spent past its budget is projected at what it has actually cost.
Costing totals don't match the invoice.
Costing is pre-tax and includes only approved scope. Invoices add sales tax and may bill a draw or a subset of lines.
Extra scope makes the job look over budget.
Put the added work on a change order. Once approved it brings its own revenue and its own cost group instead of eating the original margin.
Related guides
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Verified against the shipped product on August 24, 2026.