Skip to main content
Skip to main content

📋 Chart of Accounts for Construction

Your chart of accounts is the foundation of your financial reporting. A well-designed COA makes job costing, WIP reporting, and financial analysis much easier.

Key Principle

Design for reporting, not just recording. Think about what reports you need, then build your COA to support them.

Construction COA Structure​

Why Construction Is Different​

General business COAs don't work well for construction because:

  • Job costing requires cost tracking by project
  • WIP reporting needs underbilling/overbilling accounts
  • Multiple cost types (labor, material, sub, equipment)
  • Retention receivable and payable
  • Work in progress as an asset

Basic Structure​

1000-1999  Assets
2000-2999  Liabilities
3000-3999  Equity
4000-4999  Revenue
5000-5999  Cost of Goods Sold (Direct Costs)
6000-6999  Overhead / Indirect Costs
7000-7999  General & Administrative
8000-8999  Other Income/Expense
9000-9999  (Reserved)

Asset Accounts (1000s)​

Current Assets​

AccountDescription
1000Cash - Operating
1010Cash - Payroll
1020Cash - Savings/Reserve
1100Accounts Receivable - Trade
1110Accounts Receivable - Retention
1150Allowance for Doubtful Accounts
1200Costs in Excess of Billings (Underbillings)
1250Prepaid Expenses
1300Employee Advances
1350Due from Related Parties
1400Inventory - Materials

Fixed Assets​

AccountDescription
1500Vehicles
1510Accumulated Depreciation - Vehicles
1520Equipment
1530Accumulated Depreciation - Equipment
1540Office Furniture & Equipment
1550Accumulated Depreciation - Office
1560Leasehold Improvements
1570Accumulated Amortization - Leasehold
1600Land
1610Buildings
1620Accumulated Depreciation - Buildings

Other Assets​

AccountDescription
1700Deposits
1800Notes Receivable
1900Investments

Liability Accounts (2000s)​

Current Liabilities​

AccountDescription
2000Accounts Payable - Trade
2010Accounts Payable - Retention
2050Accrued Expenses
2100Billings in Excess of Costs (Overbillings)
2150Accrued Payroll
2160Accrued Payroll Taxes
2170Accrued Benefits
2200Sales Tax Payable
2250Income Tax Payable
2300Current Portion - Long Term Debt
2350Line of Credit
2400Due to Related Parties
2450Customer Deposits

Long-Term Liabilities​

AccountDescription
2500Notes Payable - Bank
2550Notes Payable - Equipment
2600Notes Payable - Vehicles
2650Notes Payable - Shareholders
2700Deferred Tax Liability

Equity Accounts (3000s)​

AccountDescription
3000Common Stock
3100Additional Paid-in Capital
3200Retained Earnings
3300Current Year Earnings
3400Shareholder Distributions
3500Treasury Stock

Revenue Accounts (4000s)​

By Contract Type​

AccountDescription
4000Contract Revenue - Lump Sum
4100Contract Revenue - Cost Plus
4200Contract Revenue - T&M
4300Contract Revenue - Unit Price
4400Contract Revenue - Service
4500Change Order Revenue
4600Claims Revenue
4900Other Operating Revenue

Or By Division​

AccountDescription
4000Revenue - Commercial Division
4100Revenue - Residential Division
4200Revenue - Service Division
4300Revenue - Self-Perform

Cost of Goods Sold / Direct Costs (5000s)​

Structure by Cost Type​

AccountDescription
5000Direct Labor
5100Labor Burden
5200Materials
5300Subcontractors
5400Equipment
5500Other Direct Costs
5900Cost Adjustments

Detailed Labor​

AccountDescription
5000Direct Labor - Regular
5010Direct Labor - Overtime
5020Direct Labor - Double Time
5100Burden - Payroll Taxes
5110Burden - Workers Comp
5120Burden - Health Insurance
5130Burden - Retirement
5140Burden - Union Benefits

Detailed Materials​

AccountDescription
5200Materials - General
5210Materials - Rental
5220Small Tools & Supplies
5230Permits & Fees
5240Freight & Delivery

Detailed Equipment​

AccountDescription
5400Equipment - Owned
5410Equipment - Rental
5420Fuel
5430Equipment Repairs

Indirect Costs / Overhead (6000s)​

AccountDescription
6000Indirect Labor
6100Indirect Burden
6200Shop Supplies
6300Small Equipment
6400Temporary Facilities
6500Safety Supplies
6600Quality Control
6700Warranty Costs

General & Administrative (7000s)​

Personnel​

AccountDescription
7000Officers' Salaries
7010Office Salaries
7020Estimating Salaries
7050Payroll Taxes - Admin
7060Benefits - Admin
7070Bonus & Incentives

Facilities​

AccountDescription
7100Rent
7110Utilities
7120Repairs & Maintenance
7130Janitorial

Professional Services​

AccountDescription
7200Accounting & Audit
7210Legal
7220Consulting
7230IT Services

Insurance​

AccountDescription
7300General Liability Insurance
7310Auto Insurance
7320Umbrella Insurance
7330D&O Insurance
7340Bonding Costs

Office Operations​

AccountDescription
7400Office Supplies
7410Postage & Shipping
7420Telephone
7430Internet
7440Software & Subscriptions
7450Dues & Memberships

Business Development​

AccountDescription
7500Advertising
7510Marketing
7520Entertainment
7530Travel
7540Trade Shows

Other G&A​

AccountDescription
7600Depreciation - Admin
7610Amortization
7620Bank Charges
7630Bad Debt Expense
7700Training & Education
7800Miscellaneous

Other Income/Expense (8000s)​

AccountDescription
8000Interest Income
8100Interest Expense
8200Gain/Loss on Sale of Assets
8300Rental Income
8400JV Income/Loss
8500Other Income
8600Other Expense
8900Income Tax Expense

Job Cost Coding​

Integrate with Cost Codes​

Your GL accounts work with cost codes:

GL Account: 5200 (Materials)
Cost Code: 03-2000 (Concrete Reinforcing)

Entry: 5200.03-2000 → Materials charged to Rebar

Cost Code Structure​

See our Cost Coding Guide for detailed cost code setup.

Multi-Entity Considerations​

Intercompany Accounts​

AccountDescription
1350Due from [Entity Name]
2400Due to [Entity Name]

Division Tracking​

Option 1: Separate GL accounts per division Option 2: Use department/division codes Option 3: Separate company files

Setting Up Your COA​

Best Practices​

  1. Start with template from your software or industry
  2. Customize for your business - add what you need
  3. Keep it manageable - don't over-complicate
  4. Plan for growth - leave room for new accounts
  5. Document it - create a COA manual
  6. Train your team - everyone codes consistently

Common Mistakes​

  • Too many accounts (harder to manage)
  • Too few accounts (not enough detail)
  • Inconsistent naming conventions
  • Not mapping to cost codes properly
  • No account descriptions