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About using the Time and material project type for a fixed-price project

Important

This content is archived and is not being updated. For the latest documentation, see Microsoft Dynamics 365 product documentation. For the latest release plans, see Dynamics 365 and Microsoft Power Platform release plans.

Applies To: Microsoft Dynamics AX 2012 R3, Microsoft Dynamics AX 2012 R2, Microsoft Dynamics AX 2012 Feature Pack, Microsoft Dynamics AX 2012

Projects that are sold at a fixed price are usually set up as Fixed-price projects. However, in some cases you might benefit from setting up a project as a Time and material project even though the project is sold at a fixed price. Time and material projects are generally easier to set up and execute because they do not require the use of the estimate system.

Generally, when a project contract involves a large sum of money, the project is expected to last for an extended period of time, and the schedule for recognizing revenue does not match the invoicing schedule, the Fixed-price project type is the most appropriate type.

However, if you are managing projects that have fixed prices and smaller contract values that will be fully invoiced within a single fiscal period, a Time and material project type might be suitable. In this situation, you would set the project up as a Time and material project and invoice the customer through fee transactions. No other transaction types would be billed to the customer.

See also

About project types