Construction Contracts:

Question 1

Cost Plus Fee:

Answer 1

A cost-plus contract is a construction contract under which the contractor gets paid for all construction-related expenses plus an agreed-upon profit.

Question 2

Cost Plus Fee:

Answer 2

A cost-plus contract is a construction contract under which the contractor gets paid for all construction-related expenses plus an agreed-upon profit.

Question 3

Cost Plus Fee used when:

Answer 3

Total construction costs unknown to owner

and Drawings and specifications not completed for bidding.

Question 4

Cost Plus Fee contact reimbursements:

Answer 4

Contractor must have a written agreement concerning what is reimbursable and non reimbursable

Question 5

Cost Plus Fee contact reimbursements:

Answer 5

Contractor must have a written agreement concerning what is reimbursable and non reimbursable

Question 6

Cost Plus Fee contact various methods to determine fees include:

Answer 6

Various methods to determine fees include:

1. Fixed percentage
2. Fixed amount including maximum
3. Fixed amount with bonus (Job completed ahead of schedule)
4. Fixed amount with shared savings (Owner 75% - Contractor 25%)