Guide
Paving contractor bookkeeping: tons, equipment and the season
Most of the year is earned in a window of months. The books have to show what each job in it really used.
Reviewed by Darren Lim, US CPALicense CPA.742536024 min read
Paving is a race against a season and a temperature. Hot mix has to be placed while it is hot, plants in colder regions close for the winter, and most of a year’s revenue is earned in a window of months with heavy equipment, fuel and crews all running at once.
The books have to make that window visible: what each job used in tons and hours, what the equipment really costs, and whether the busy season earned enough to carry the quiet one.
Tons, by the ticket
Hot mix asphalt is bought by the ton, with a ticket for every truckload. Those tickets are the most important source document in the business.
For each job, reconcile tons ordered, tons placed, and tons invoiced by the plant. Over-ordering is normal; a job where the gap is much larger than usual points to a thickness error, waste, or a ticket that does not belong to the job. And where you bill by the ton or the square yard, the tickets are what settle disputes.
Aggregate base, tack coat and other materials follow the same rule: coded to the job, matched to delivery tickets.
Equipment by the hour
Pavers, rollers, milling machines, skid steers and trucks are most of the capital in a paving business. Give each machine an hourly cost — ownership (financing, insurance, the value it loses) plus operating (fuel, maintenance, wear parts) — and charge its hours to jobs. The method is the same as for excavation; see excavation bookkeeping.
Fuel for off-road equipment is often taxed differently from road fuel. Keep them separate in the books from the start, and let your CPA confirm what applies.
Mobilization and minimums
Moving a paving crew and equipment to a site costs the same whether the job is a driveway or a parking lot. Mobilization should be a line on every job cost. It is also why small jobs so often lose money: the fixed cost of showing up swamps the margin on the asphalt.
Track job size against margin. Many paving companies discover a size below which they should not quote without a minimum charge.
Sealcoating and striping
Sealcoating, crack filling and line striping are usually a separate business inside a paving company: lower-ticket, faster, material in drums or totes, often sold as recurring maintenance to property managers. Separate them with their own income accounts or classes. Material on hand — sealer, crack filler, paint — is inventory until used.
Commercial and public work
Parking lots, subdivisions and municipal work bring pay applications, retainage, lien waivers, bonding and often prevailing wage and certified payroll. See retainage explained, getting bonded, and prevailing wage and certified payroll. Once jobs span months, a WIP schedule is what sureties and banks ask for.
The winter
In colder regions, the plants close and paving stops. Payroll shrinks but equipment payments, insurance and overhead do not. A reserve built in the season carries the winter — the seasonal reserve calculator sizes it from your own figures — and winter is the time to review which job types and customers actually paid over the year.
Related
- Concrete contractor bookkeeping
- How to bid a job so it makes what you intended
- Buy, lease or finance? Equipment decisions
General information, not tax advice. Fuel tax treatment and depreciation are for your CPA to confirm.
How we do this
We build this into your books. Starting with a month that costs you nothing.
Asphalt tonnage tickets reconciled to each job, equipment charged by the hour, mobilization on every job cost, and sealcoating and striping kept on their own lines.
- Every transaction categorized, accounts reconciled, the month closed
- Reviewed and signed by Darren Lim, US CPA — license CPA.74253602
- The 24-Hour Guarantee: Your first month back in 24 hours, or the next month is free.
Small paving jobs so often lose money because mobilization swamps the margin, and nobody sees it without per-job costs. One month shows you. Free, back in 24 hours.