Price
is a flexible item that depends upon varied factors, such as strategies, competition,
cost etc. It is an essential element that affects both buyers and sellers.
Contract pricing begins with estimating the cost of the contract. Cost is
determined by developing a work breakdown structure, which is based on the
technical and administrative performance requirements. Performance costs are
determined by the resources needed to work, quantities of the resources needed
and cost of the resources. Thus, contract price can be defined as a mutually
agreed upon total amount that a buyer or project owner pays to a contractor on
the completion of the contract as per the terms and conditions.
Contract
price may be calculated with the help of three methods. Loading...