• Journal of the Korea Convergence Society
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• v.9 no.3
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• pp.223-230
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• 2018

This study analyzes the cost fluctuation between cost in contract stage and cost in adjustment stage in defense R&D project. This research shows that certain costs hold with the cost fluctuation and their degree of influence. The results of first analysis show that 13 out of 17 costs have a relationship with the cost fluctuation. The estimate of direct labor cost is positive and significant at the 0.1% level(direct labor = 1.022, t = 38.355). The estimate of amount of cost paid to subcontractor is positive and significant at the 1% level(amount paid to subcontractor = 0.942, t = 51.894). The results of second analysis show that all the direct costs have a relationship with the cost fluctuation(The fact that cost system is focused on direct labor cost is a consideration in this analysis). The estimate of direct labor cost is positive and significant at the 0.1% level(direct labor = 2.014, t = 21.787). The estimate of amount of cost paid to subcontractor is positive and significant at the 0.1% level(amount of cost paid to subcontractor = 1.068, t = 15.636). This finding supports a proposal theory that cost system is focused on direct labor cost through actual proof analysis and an inducement that amount of cost paid to subcontractor is a way to reduce the R&D cost.