Infrastructure Costs

Infrastructure costs are those costs that exist because a firm has an infrastructure (e.g., a building, various machinery, etc.). Examples include depreciation and long?term leases. As these costs typically benefit a firm for a longer period of time than most other costs, capital budgeting is often necessary, and management pays particular attention to the outlay for these types of expenditures. Infrastructure costs can be contrasted to engineered costs and discretionary costs. See also engineered costs and discretionary costs.