The Overhead Percent field in Job Type Maintenance is designated for a percentage amount (i.e., 2%, 1.5%, etc.) which will be added to the total costs on each job. This field can be used to capture overhead job costs. It is tied to the Job Type code because many times, overhead can be higher on certain types of jobs versus others. It is only visible and accessible by User Control settings.
This feature can also be used to inflate costs by a small percentage, so that owners are not hit as hard on their bottom line when problems arise on a job. This added cost will not be broken down in the normal Job Cost screens, however it is simply added to the total cost on the job (before any Overbill value). It will then be reflected in the base used to determine salesperson commissions (provided commissions are being programmed on Margin and not on Total job).
In other words, the commission base will be reduced by the total Overhead amount, and the bottom line profit and margin totals on the job will be adjusted accordingly.
The Overhead Percentage amount will not inflate inventory value, nor will it show up in the Purchase Order module or Receive Inventory feature. Additionally, it will not be reflected in the Review P.O. History option in the Accounts Payable / Open Item Maintenance module. It is simply a tool for owners and managers to recoup some overhead costs.
In the Owner Functions menu, the Overbill / Overhead Job Cost Margin Report will display true job cost information and break down the total Overhead Percentage amount collected on each job. If you do not wish to use this feature, then you may simply leave this field blank.
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