Owners, Subs, time tracking, items & billing rates

The Billing Rate feature is designed to allow you to charge different rates for employees or vendors for the same item.  You could use the same item but, with a different billing rate, as long as the owner is in QuickBooks as a vendor or employee.  Just enter her time on the weekly timesheet as well as the draftsmen.  Mark it billable.  Create a billing rate for Owner - Drafting at $XX in addition to the one you have for Drafting - Subs at $XX. 

And, you shouldn't need different billing rates for the two draftsmen if they are being billed out with the same rate.  The billing rate is for the rate being charged on invoices, it won't affect the cost of individual vendors.

Hope that helps.

"You could use the same item but, with a different billing rate, as long as the owner is in QuickBooks as a vendor or employee. "

That is not necessary and leads to errors. If the owner is not really an employee, then the Timesheet and Owner utiliize the Other Names list.

I would suggest not using the Billing Rate Level for your client file. Billing Rate Levels adjust Base Price of items per the name on the timesheet. Price Levels adjust Base Price of items per customer name.

You should set up the drafting item, or Items, to meet what you need to see on reports and use in estimates. You want at least two.

Since the owner bills out at a different rate, if the owner is not on payroll ( a Sole Proprietorship), you won't get good job costing unless you pay the owner using Items, such as, items that are tracked as Draw instead of Expense.

Create a Service item for Owner time, "this is used in" should be checkmarked to provide an Expense side and an Income side for accounting data flow. Set the Expense side to owner draw. Pay the owner using Job Tracking and the Items tab.

For the subs, using a timesheet allows you to pay from the timesheet, but the two-sided item "Cost" data is what is used for AP; not Billing Rate Level. This can be overridden, if they don't Cost the same rate, of course. QB tells you to "leave cost as $0 if cost varies" in fact.

For using this method, the timesheet data is marked Not Billable. When you pay the subs, such as Write Check, QB asks if you want to pay from the timesheet. This is the transaction where the Items are marked Billable.

Now you have Billable entries for invoices and the Cost data.

Costs do not come from timesheets. They come from purchases and payments.

I used QB for an architectural firm for ten years. It works well but takes some set up.

No problem.

"If I enter the owner's time"

meaning, we are tracking Tasks...

"and they're going to take a draw,"

meaning, they take funds...

"I mark it unbillable,"

Well, the timesheet is marked billable, unless you intend to use a payment (purchase) transaction of some sort and bill from it. You don't need to have Billable entries to have job cost data. You need to have Billable entries for something that is to be charged back. You need to Job Track any data that you expect to see on job reports. These serve different purposes...

"write a check to the owner off her time...but what if she's getting more? "

You use the Items tab and job track the amounts that apply to jobs, such as, "I want to job cost myself at $20 per hour." On the Expenses tab, add the rest as Owner Draw. Check = total of Items tab and Expenses tab. This is Splits and job allocation.

"and Should I be encouraging the owners to keep time cards to allocate their time to jobs?"

Always. Even if you don't bring $ into the job costing picture, the ability to avoid tracking your time means, you have no idea if you really are wasting your time or underbidding a project. Or both. This is a business management tool and not a bookkeeping or financial tool.

QB is far more than accounting.