Unit Cost Analysis

Annual Recurring Operating and Support Cost Methodology

by John F. Schank, Susan J. Bodilly, Richard Y. Pei

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This report presents a consistent and complete methodology for comparing annual operating and support costs of active and reserve units within and across all components of the force. Existing service models and data were modified or manipulated to create active and reserve annual cost models and cost factors. The report describes the general approach and uses service-specific case studies to demonstrate methods and cost factor derivations. Case studies include: Air Force F-4D and C-130E squadrons; Army mechanized infantry, tank, field artillery, and combat engineering battalions; and Navy F-4S squadrons and FF1052 frigates. Results, given in FY 1983 dollars, show wide variances in annual active and reserve unit costs across units and services, emphasizing the need for a case-by-case approach to unit costing. Technical appendixes present the detailed descriptions of cost factor derivations and data sources. A companion document, R-3210/1-RA, provides a summary of this report in executive briefing format.

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