Intermediate Financial Accounting II
A fixed-price contract is a type of agreement where the payment amount does not change regardless of the actual costs incurred by the contractor. This means that the contractor agrees to deliver a specified service or product for a set price, providing budget certainty for the buyer while also placing the risk of cost overruns on the contractor. These contracts are often used in project-based work, where defining clear deliverables and timelines is essential to both parties.
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