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Article #6387

Re: Stupid Shut Cost arguements (was Re: Terminal Velocity of DCX?

#6387
From: Gary Coffman
Date: Fri, 25 Dec 1992 01:46
34 lines
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In article <1992Dec23.132824.14131@iti.org> aws@iti.org (Allen W. Sherzer) writes:
>In article <9gt204c@rpi.edu> strider@clotho.acm.rpi.edu (Greg Moore) writes:
>
>>If this is teh case, than
>>you have to treat the shuttle development costs as sunk costs.
>
>I have no problem treating the research vehicles which supported
>Shuttle (like X-24) being treated as sunk costs but I don't think
>development costs should be. That simply makes commercial development
>that much harder.

In military procurement, the development costs are charged against
the prototypes, X, Y, etc, and the operational vehicles of the procurement 
are charged at "flyaway" cost. Following this model, Enterprise ate the 
development costs, and it's retired. Current Orbiters are only liable for 
their $1.5 billion flyaway cost and their operational costs. 

Payload costs, including mission specialists and their ground support 
staffs, belong to the customer for the payload, Now in NASA's case, 
these costs all come out of the same pocket, but you're making faulty 
conclusions when you insist on lumping them for Shuttle while separating 
them, and ignoring large parts of them, for your favorite projects.
Remenber that the data gathered, and techniques developed by the Shuttle
program, the RL-10 development program, NASP materials, etc are available 
free to McDD for their program. Are you going to charge these costs against 
DC? To be consistent with the way you treat Shuttle, you should, but of
course this is nonsense accounting.

Gary
-- 
Gary Coffman KE4ZV          |    You make it,     | gatech!wa4mei!ke4zv!gary
Destructive Testing Systems |    we break it.     | uunet!rsiatl!ke4zv!gary
534 Shannon Way             |    Guaranteed!      | emory!kd4nc!ke4zv!gary      
Lawrenceville, GA 30244     |                     | emory!ke4zv!gary@gatech.edu
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Message-ID: <1992Dec25.014627.4982@ke4zv.uucp>
Path: arc1-ca.pugleaf.net!sparky!uunet!wupost!emory!wa4mei!ke4zv!gary
References: <71877@cup.portal.com> <1992Dec22.160715.28828@iti.org> <9gt204c@rpi.edu> <1992Dec23.132824.14131@iti.org>

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Newsgroups: sci.space
Path: arc1-ca.pugleaf.net!sparky!uunet!wupost!emory!wa4mei!ke4zv!gary
From: gary@ke4zv.uucp (Gary Coffman)
Subject: Re: Stupid Shut Cost arguements (was Re: Terminal Velocity of DCX?
Message-ID: <1992Dec25.014627.4982@ke4zv.uucp>
Reply-To: gary@ke4zv.UUCP (Gary Coffman)
Organization: Destructive Testing Systems
References: <71877@cup.portal.com> <1992Dec22.160715.28828@iti.org> <9gt204c@rpi.edu> <1992Dec23.132824.14131@iti.org>
Date: Fri, 25 Dec 1992 01:46:27 GMT
Lines: 34