Cost Plus Contract Meaning With Example In Travis
Category:
State:
Multi-State
County:
Travis
Control #:
US-00462
Format:
Word;
Rich Text
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Description
A cost plus contract is an agreement where the owner pays the contractor for the actual costs incurred for labor and materials, plus an additional fee for the contractor’s services. For example, in a construction project in Travis, if the total costs for materials come to $50,000, and the contractor fee is set at $10,000, the owner would owe a total of $60,000 upon completion. Key features of this contract include defining the scope of work, specifying the work site, and detailing responsibilities for permits, insurance, and changes to the work. Users must ensure to document any changes via written change orders. This form is especially useful for attorneys, partners, owners, and paralegals as it streamlines the construction process and clarifies financial obligations. The clear structure aids legal professionals in advising clients accurately and efficiently, while also establishing a mutual understanding between owners and contractors.
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FAQ
Ing to Boundy (2012), typically, a written contract will include: Date of agreement. Names of parties to the agreement. Preliminary clauses. Defined terms. Main contract clauses. Schedules/appendices and signature provisions (para. 5).
Contract costing, also known as Terminal costing, is a form of specific order costing which applies where work is undertaken to customer's special requirements and each order is of long duration. It is a variant of job costing as each contract is nothing but a job completed.
Contract Costs means the estimated costs of the extension, conversion, or modification of service.
