What did this job
actually earn?

Start with a clear calculation

Project profit = project income − assigned project costs. For the example below, income is the amount billed excluding tax. Costs are the materials, labour, subcontractors and other costs assigned to that job. Your accountant may use a different recognition basis for formal accounts.

Project margin = project profit ÷ project income × 100. Margin is different from markup: markup compares profit with cost rather than income.

A worked example

Example ACMV job · SGD, excluding tax

Item	Amount
Billed income	S$48,200
Materials	S$14,820
Labour	S$9,600
Subcontractors	S$5,400
Other assigned costs	S$1,820
Total project costs	S$31,640
Project profit	S$16,560

S$16,560 divided by S$48,200 gives a project margin of approximately 34.4%. It does not mean 34.4% of your company’s turnover becomes net profit.

Profit does not tell you what was paid

If the customer has paid S$36,000 of the example’s S$48,200 billed amount, S$12,200 remains uncollected. That unpaid balance does not disappear because the project margin is positive.

Cash collection is a separate check. Supplier payment dates and other cash commitments also matter.

Check the costs that are easy to miss

• Bills not yet entered or assigned to the project.
• Labour and materials needed for work that remains.
• Extra costs created by a variation order.
• Credits and supplier rebates that affect costs.
• Shared overheads such as office rent, administration or equipment costs not already allocated.

Ask whether you are reviewing the result to date or the expected result on completion. Both can be useful, but they answer different questions.

Make a regular review practical

Review an active project with the person responsible for the work and the person responsible for the books. Reconcile the scope, income, assigned costs and outstanding payments. Record what is still missing.

Learn how TidyAcc’s project costing workflow connects the records.