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Welcome to Act Notes Tutorials! My name is Matt, and I am here to explain the Time and Materials contract type. This type of contract is typically used in construction and product development, where the company or employee is paid for their time and materials used. Time and Materials contracts are chosen when project size or changes cannot be estimated, unlike fixed-price contracts. According to federal regulations, supplies or services are acquired based on direct labor hours at fixed hourly rates including wages, overhead, expenses, profit, and material costs. Use a Time and Materials contract when project scope is uncertain.
