Allowances in T&M Billing

How should I handle allowances in projects with Time & Materials billing?

A project Allowance is a small bit of time and materials work, that you can include in any type of project. Allowances are very helpful for any items in an Estimate that don't have firm specifications.

When you submit a project bill for allowanced items, Goldenseal bills for the difference in cost between actual costs and the original allowance amount. If you spend more than the allowance, the bill is for a positive amount. If you spend less than the allowance, the bill is for a negative amount (subtracted from the main project billing amount).

On a project with time and materials billing, you really don't even need Allowances, since everything is based on actual costs. However, Goldenseal automatically adjusts the billing amounts if you do decide to use allowance billing on a T&M project.

In Goldenseal estimating software 2.8 or older, do not enter the allowance into the Applies To field in your expense records. That way the expenses will be billed as part of the regular project. In versions of Goldenseal after 2.8, Time & Materials billing works correctly whether or not you expense items for the Allowance.

HINT-- If you are not sure if a T&M project has allowances entered, choose Billing from the Bank menu and choose Allowances from the submenu. If the T&M project is listed there, then you have entered allowance expenses for the project, and should remove the allowance from the Applies To field in those records.

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