A Costing Agreement

The contractor must justify and bear all costs related to the contract. Depending on the terms of the agreement, the contractor may „replenish” certain costs, including working wages, to cover overhead and unforeseen expenses. Owners and contractors have two options for the nature of the contract and the agreement: fixed price or cost-plus. A price agreement is a pricing tool set up in the Order app that provides item charges (unit charges) for order and requirement positions. If you have established a cost loss hierarchy for your company that indicates price agreements, some price agreements for item costs may be referenced. Contract Costing is a special type of order calculation, in which the cost unit is a single contract. The contract itself is a cost center and is executed according to the customer`s requirements.