Project and related activities are generally active for longer time periods. While developments keep happening on the Project, there are various transactions that are done against each project. Hence, it becomes important to track the Profitability of a Project to ensure that you don't overspend.
Project in Sales Transactions
You can link a Project in all the sales transactions like Sales Order, Delivery Note, Sales Invoice, and Payment. Linking Project with the sales transactions will help you in tracking income received against that Project.
In sales transactions, Project field is generally available in the More Information section.
Project in Purchase Transactions
The project can also be linked to the purchase transactions like Purchase Order, Purchase Receipt, and Purchase Invoice.
In the purchase transactions, Project's link field is available in the Item table. This is because you could be procuring material for multiple Projects from the same purchase entry.
Budgeting against Project
You can create Budget for a Project as well. The expense limit defined in the Budget master will be validated in the expense transactions.
Based on the all the income and expense entries created for the Project, you can get its profitability.
Accounts > Profitability Analysis
Filter report based on Project to check Project-wise Profitability.