Construction Accounting Course

Lesson 1 • Financial Statements for Contractors

Covers the balance sheet, income statement, and cash flow statement as used by construction firms. Students interpret contractor-specific line items and schedules.

Lesson 2 • Core Accounting Principles Applied

Reviews fundamental accounting concepts—assets, liabilities, equity, and matching—within a construction context. Connects general ledger structure to construction-specific reporting needs.

Lesson 3 • Construction Industry Financial Overview

Introduces the economic structure of construction firms and how revenue cycles differ from other industries. Sets the context for all subsequent accounting methods covered in the course.

Lesson 1 • Subcontractor Cost Tracking

Covers the accounting treatment of subcontracted work within the job cost system. Students manage subcontractor invoices, retainage, and compliance documentation.

Lesson 2 • Introduction to Job Costing

Defines job costing and explains why project-level cost tracking is essential in construction. Contrasts job costing with process costing to clarify its unique application.

Lesson 3 • Overhead Allocation Methods

Explains how indirect costs are identified, pooled, and distributed across jobs using allocation bases. Students select appropriate drivers to avoid cost distortion.

Lesson 4 • Tracking Direct Labor Costs

Teaches methods for capturing and allocating field labor costs to specific jobs. Covers time tracking systems, labor burden, and payroll integration.

Lesson 1 • Revenue Recognition Standards in Practice

Applies current performance-obligation-based revenue standards to construction contracts. Students identify distinct performance obligations and allocate transaction prices.

Lesson 2 • Overbillings and Underbillings

Explains billings in excess of costs and costs in excess of billings as balance sheet items. Students calculate, record, and interpret these figures to assess project financial health.

Lesson 3 • Percentage-of-Completion Method

Teaches the dominant revenue recognition method for long-term construction contracts. Students calculate completion percentages using cost-to-cost and other input measures.

Lesson 4 • Completed-Contract Method

Covers when and how to apply the completed-contract method for short-term or uncertain projects. Students compare tax and financial reporting outcomes against percentage-of-completion.

Lesson 1 • WIP Schedule Structure and Components

Breaks down every column of the WIP schedule and explains the relationship among contract value, costs, and billings. Establishes the WIP schedule as the link between job costing and financial statements.

Lesson 2 • Estimating Costs to Complete

Focuses on the judgment-intensive process of projecting remaining costs on active projects. Students apply systematic approaches to reduce estimate variability and improve accuracy.

Lesson 3 • WIP Adjustments and Journal Entries

Covers the journal entries required to record WIP adjustments in the general ledger. Students post overbilling, underbilling, and anticipated loss entries accurately.

Lesson 4 • Preparing the Monthly WIP Report

Guides students through the step-by-step process of compiling a WIP report at month-end. Covers data sources, reconciliation steps, and common entry errors.

Lesson 1 • Retainage Accounting

Covers the accounting treatment of retainage withheld by owners and held from subcontractors. Students track retainage receivable and payable through project completion.

Lesson 2 • Accounts Receivable Management

Addresses the setup and maintenance of the construction accounts receivable ledger. Students apply aging analysis and dispute resolution to minimize overdue balances.

Lesson 3 • Lien Rights and Payment Security

Introduces mechanics lien rights as a financial protection tool for contractors and subcontractors. Students understand preliminary notice requirements and lien filing timelines.

Lesson 4 • Collections and Cash Flow Acceleration

Provides strategies for accelerating collections and reducing days sales outstanding on construction projects. Students design collection workflows and escalation procedures.

Lesson 1 • Internal Controls and Fraud Prevention

Identifies common fraud schemes in construction AP and payroll and the controls that mitigate them. Students design segregation-of-duties frameworks appropriate for small and mid-size contractors.

Lesson 2 • Construction Accounts Payable Workflow

Maps the full AP cycle from purchase order creation to payment release in a construction environment. Establishes controls that prevent duplicate payments and unauthorized disbursements.

Lesson 3 • Cash Flow Forecasting for Projects

Teaches construction-specific cash flow forecasting using project schedules and billing plans. Students build short-term and long-term cash projections to prevent liquidity gaps.

Lesson 4 • Banking Relationships and Credit Lines

Explains how contractors use revolving credit lines and equipment financing to manage working capital. Students evaluate financing options and understand lender reporting requirements.

Lesson 1 • Employee Benefits Accounting

Covers the accounting for health insurance, retirement plans, and union benefit contributions. Students record benefit costs accurately and reconcile benefit liabilities.

Lesson 2 • Construction Payroll Fundamentals

Covers the payroll cycle for field and office employees, including gross-to-net calculations and deductions. Establishes payroll as a primary cost driver requiring tight integration with job costing.

Lesson 3 • Prevailing Wage and Certified Payroll

Explains prevailing wage requirements on publicly funded construction projects and certified payroll reporting. Students prepare compliant certified payroll reports and understand fringe benefit credit rules.

Lesson 4 • Workers Compensation and Insurance Audits

Addresses workers compensation premium calculation, payroll classification, and year-end audit preparation. Students minimize premium errors and manage audit exposure.

Lesson 1 • Surety Bonding and Financial Prequalification

Explains how surety underwriters analyze contractor financials to issue bid, performance, and payment bonds. Students prepare financial packages that support bonding capacity.

Lesson 2 • Contractor Financial Statement Preparation

Guides students through preparing a complete set of contractor financial statements, including the WIP schedule as a supplemental report. Emphasizes accuracy, consistency, and disclosure.

Lesson 3 • Depreciation and Equipment Tax Strategy

Addresses depreciation methods, bonus depreciation, and expensing elections for construction equipment. Students calculate depreciation schedules and assess the tax impact of equipment decisions.

Lesson 4 • Construction Tax Methods and Elections

Covers tax accounting methods available to contractors, including long-term contract methods and small-contractor exemptions. Students evaluate method selection for tax deferral and cash flow benefits.