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This tutorial provides an overview of time and materials contracts, commonly used in construction and product development. In this type of contract, companies or employees are paid for their time and the materials used in the project. It is ideal for situations where project size or changes cannot be accurately estimated. Detailed in federal regulations, these contracts involve acquiring supplies or services based on direct labor hours and fixed rates that cover wages, overhead, and materials cost. Time and materials contracts are recommended when project scope and changes are uncertain.
