Use app×
Join Bloom Tuition
One on One Online Tuition
JEE MAIN 2025 Foundation Course
NEET 2025 Foundation Course
CLASS 12 FOUNDATION COURSE
CLASS 10 FOUNDATION COURSE
CLASS 9 FOUNDATION COURSE
CLASS 8 FOUNDATION COURSE
0 votes
141 views
in General by (114k points)
closed by
Which of the following contracts is not type of cost-plus contract?
1. Cost plus percentage contract
2. Cost plus lump sum contract
3. Cost plus fixed fee contract
4. Cost-plus fluctuating fee contract

1 Answer

0 votes
by (115k points)
selected by
 
Best answer
Correct Answer - Option 2 : Cost plus lump sum contract

Explanation:

Cost-plus contract:

(i) Cost-Plus, mean something over and above the cost involved in completing the contract which is under consideration, the former word “Cost” will include all types of cost, i.e., direct, indirect, overhead, etc. incurred while performing the activity and the latter word “Plus” refer to profit which will include a specific percentage of income over and above the total cost of the contract as agreed by the contracting parties.

Typed of cost-plus contract:

The contract can vary only in the aspect of payment of profit or fee component to the contractor.

(i) Cost + Fixed Percentage Fee:- In this, the contractor will receive the income in using a pre-decided percentage on the cost of the contract.

(ii) Cost + Fixed Fee Contract:- Under this contract, the amount to be paid to the contractor is fixed and independent from the cost of the contract.

iii) Cost + Fixed percent / Fee and Incentive:- Certain contracts may have an additional incentive covenant, which states that in case of early completion of the completion of levels as mentioned in the agreement, the contractor is eligible to receive the incentive as mentioned in terms of the agreement.

Welcome to Sarthaks eConnect: A unique platform where students can interact with teachers/experts/students to get solutions to their queries. Students (upto class 10+2) preparing for All Government Exams, CBSE Board Exam, ICSE Board Exam, State Board Exam, JEE (Mains+Advance) and NEET can ask questions from any subject and get quick answers by subject teachers/ experts/mentors/students.

Categories

...