Completed Contract Method - Time & Materials Job

I have a C-Corp client in the home construction business. It's a small operation. They usually are only running 2 jobs at a time. Generally, their contracts are fixed price (with change orders) and they report their income under the completed contract method.

This last year they took a time & materials job. The bill for their time (marked up labor) and pass along the costs of materials with no mark up. Are they still allowed (required) to use the completed contract method for this job?

I believe they are required to use the completed contract method if the contract is a long term contract.

Reg 1.460-5 has rules for allocating costs in cost plus contracts, that are long term contracts. So, I infer that time an materials contracts would be treated the same way under the long term contract rules. I can't find any other criteria for long term contracts that would carve out an exception for time and material contracts, the only criteria being length of time and subject matter (real property).

To begin with, it is important to determine if the contract is actually a long-term contract.

Appreciate the reply, MWPXYZ.

Yes. It's a long-term contract. The bookkeeper was posting the income to consulting fees, so it made me question it. But they are on the job until the home is completed.