Which of the following best describes a supplier contract?

A supplier contract is best described as a legally binding document specifying terms between the buyer and supplier. This type of contract outlines the rights and responsibilities of both parties, including pricing, delivery terms, quality standards, and other conditions that govern the procurement process. By establishing a legal framework, it helps ensure that both the buyer and the supplier are clear on their obligations, thus reducing the potential for disputes and misunderstandings.

In contrast, the other choices do not encapsulate the essence of a supplier contract. An informal agreement with a vendor does not hold the same legal weight and may lack the clarity and protection that a formal contract provides. A record of supplier invoices focuses solely on tracking the invoicing aspect of transactions rather than the comprehensive terms of engagement between parties. Similarly, a tracking mechanism for supplier payments pertains specifically to financial transactions rather than the overarching relationship and obligations defined in a contract.