Variable Billing Projects allow you to invoice your clients for both the time your staff spends on a project, and whatever fixed cost items you bill your client for.
To allow for billing based on both time tracked and any fixed cost items, you will want to set your billing type to "Time & Materials":
Time and Materials allows you to set rates for your allocated time, and fixed costs for your materials and expenses:
Then, when the time comes to Invoice and you want to include both the tracked time and the fixed cost items, choose one of the time based invoicing options and make sure to tick the "Include Quantity/Fixed Items" box. This will allow you to select both of these types of Items for invoicing:
