Which of the following best explains 'time and materials contracts'?
A) The buyer agrees to pay the supplier all material costs and employee hours against pre-determined hourly rates and margins for services.
B) The buyer agrees to pay the supplier all material costs.
C) The buyer agrees to pay the supplier all employee hours against pre-determined hourly rates and margins for services.
D) The buyer agrees to pay the supplier all material costs and employee hours.

Question

Which of the following best explains 'time and materials contracts'? 
A) The buyer agrees to pay the supplier all material costs and employee hours against pre-determined hourly rates and margins for services. 
B) The buyer agrees to pay the supplier all material costs. 
C) The buyer agrees to pay the supplier all employee hours against pre-determined hourly rates and margins for services. 
D) The buyer agrees to pay the supplier all material costs and employee hours.

Quizplus · Accepted Answer

A time and materials contract is a type of contract where the buyer agrees to pay the supplier for all material costs and employee hours, based on pre-determined hourly rates and margins for services. This means that the buyer will have to pay for both the cost of materials and the amount of time spent by the supplier's employees on the project, which will be calculated based on agreed-upon hourly rates and margins.

Which of the Following Best Explains 'Time and Materials Contracts