What is typically considered a fixed cost in manufacturing?

Building depreciation is typically considered a fixed cost in manufacturing because it represents a constant expense associated with the asset of a manufacturing facility. Depreciation allocates the cost of the building over its useful life, and this charge remains consistent regardless of the production level or the volume of goods manufactured.

Fixed costs are expenses that do not vary with the level of output; they remain constant even when production increases or decreases. In contrast, raw materials and consumables are variable costs, as they fluctuate with production volumes. Direct labor can also be variable if it includes overtime or temporary workers whose hours may increase as production demands rise. Thus, building depreciation stands out as a true fixed cost, as it is incurred continuously regardless of operational activity levels.