cost-plus contract


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cost-plus contract

[¦kȯst ′pləs ‚kän‚trakt]
(engineering)
A contract under which a contractor furnishes all material, construction equipment, and labor at actual cost, plus an agreed-upon fee for his services.
References in periodicals archive ?
For cost-plus contracts, the government pays all cost overruns and the contractor is virtually unaffected.
Cost-plus contracts also can strain accounting systems that were designed for private commercial investors.
Further choices are required between various types of contracts ranging between firmprice, incentive, and cost-plus contracts.
Under cost-plus contracts, a principal pays ail project costs plus a fee to the agent; the agent receives a fixed fee under fixed-price contracts.
Other factors which may favor these industry offers are fixed-price rather than cost-plus contract terms, and an anticipated unwillingness by the US Army to guarantee installed system performance.
Either we bid on a lump sum contract based on completed plans and specifications or a cost-plus contract with or without a guaranteed maximum price (GMP), also based, in all likelihood, on completed plans and specifications.
This taxpayer's compensation arrangement with the relos resembles a cost-plus contract, which is frequently used in manufacturing or construction.
McCain has threatened to block funding for the B-21 aircraft, which will cost around $500 million for each unit, as long as it remains a cost-plus contract.
The cost-plus contract modifications exercise options for post-delivery support of Littoral Combat Ship USS Gabrielle Giffords (LCS 10) and Littoral Combat Ship USS Omaha (LCS 12).
In a cost-plus contract, a share ratio based on the contract cost and the contractor's fee (profit) is negotiated so that the contractor has a predetermined responsibility for the performance costs, which will directly affect the fee (profit) (U.
I completely agree with David Packard that costs can be controlled on a cost-plus contract by better management.
Finally, in some cases, the government may terminate a cost-plus contract for convenience.