A Variation on Cost-Plus Pricing Is Time-And-Material Pricing

question 8

Essay

A variation on cost-plus pricing is time-and-material pricing. Under this approach, two pricing rates are set.
Required:
Explain where this approach is used and identify the steps involved in time-and-material pricing. Also explain what the material loading charge covers and how it is expressed.

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Definitions:

Influenza

A highly contagious viral infection that affects the respiratory system, commonly known as the flu.

Allergy

An immune system response to a foreign substance (allergen) that is not typically harmful to the body, which can cause various symptoms.

Chronic Obstructive Pulmonary Disease

A group of lung conditions that cause breathing difficulties, including emphysema and chronic bronchitis.

Poor Appetite

Reduced desire to eat, which can be a symptom of various medical conditions or may occur as a side effect of certain treatments.