Bookkeeping, payroll, and accounting services for small businesses across Northwest Arkansas.

Call or Text: (479) 685-9673

How do I handle progress payments in my construction books?

Progress payments require a different approach than simple invoicing because the work happens over time and payment comes in stages. Getting this right means you’ll always know where each job stands financially.

Start by setting up each project as a separate job in your accounting system. In QuickBooks, this means creating a project or customer sub-job for each contract. Every invoice you send, every material purchase, every labor hour, and every subcontractor bill should be coded to that specific job. Without this separation, you have no way to know if a project is making or losing money until it’s too late.

When you submit a draw request or payment application, record it as an invoice to the customer for that specific job. If you’re billing $45,000 for completed foundation work, create an invoice for $45,000 coded to the foundation phase of that project. When the payment arrives, apply it against that invoice. This keeps your receivables accurate and shows what’s been billed versus what’s been collected.

Retainage needs its own tracking. Most commercial and larger residential jobs hold back 5 to 10 percent until final completion. When you invoice $45,000 but only receive $40,500 because of 10% retainage, you need to record that $4,500 somewhere. Create a retainage receivable account and track it by job. At project closeout when you receive the holdback, you’ll apply that payment and clear the retainage balance.

Match your costs to the same job and phase. If you’re invoicing for foundation work, your books should show the concrete, rebar, labor, and forming subcontractor costs against that same job. This is where most construction contractors struggle. The invoicing happens, but costs end up in generic expense accounts with no job assignment. You think you’re making money, but you can’t prove it.

Review your work in progress regularly. Compare what you’ve billed to what you’ve spent plus what’s committed. A job that looks profitable based on billings received might actually be underwater once you factor in the invoices sitting on your desk and the work remaining to complete the scope.

The goal is knowing your true position on each project at any moment. A bookkeeper near Gentry who understands construction can help you set up job costing correctly from the start. The structure matters as much as the data entry. Get it right and your books become a management tool, not just a tax compliance exercise.

Northwest Arkansas's Dedicated Bookkeeping Partner

The Next Step:
A Quick Conversation

Tell us about your business and where you need help. We'll listen, ask a few questions, and give you a clear plan and honest price.

More Questions

What does a bookkeeper actually do for a small business?

A bookkeeper handles day-to-day financial record-keeping including transaction categorization, bank reconciliation, and financial statement preparation. The work keeps your books accurate and tax-ready so you can focus on running your business.

Read answer

What quarterly taxes do trucking companies need to pay?

IFTA is the big one most trucking companies deal with quarterly. You'll also owe federal and state estimated taxes, plus quarterly payroll taxes if you have employees.

Read answer

How do I track daily sales from my POS system?

Either integrate your POS directly with your accounting software or enter a daily sales summary manually. The method matters less than doing it consistently and reconciling against your bank deposits.

Read answer

What tax obligations do salon owners have?

Salon owners must pay income tax, self-employment tax, and collect Arkansas sales tax on services and products. If you have employees, you also handle payroll taxes, and booth renters require 1099 filings.

Read answer

How do I track mileage in QuickBooks?

QuickBooks Online has a built-in mileage tracker in the mobile app that can log trips automatically or let you add them manually. You'll categorize each trip as business or personal, and the business miles feed directly into your expense records for tax time.

Read answer

What's the best way to track expenses in QuickBooks?

Connect bank accounts for automatic imports and set up categorization rules for recurring transactions. Use the mobile app to capture receipts digitally and reconcile your accounts weekly instead of monthly.

Read answer

Oliver Bookkeeping Solutions offers monthly bookkeeping, payroll, and accounting services to small businesses in Benton County and across Northwest Arkansas.

Client Reviews

5-Star Rated Firm

Social

  • QuickBooks Level 1 Certified badge
  • QuickBooks Level 2 Certified badge
  • QuickBooks Payroll Certified badge
  • Intuit Bookkeeping Certified badge

© 2026 Oliver Bookkeeping Solutions, LLC