Hello,
I was going through the Relevant costing chapter in study hub and got a little bit confused regarding labour cost.
For materials, the Relevant cost would be the opportunity cost of contribution foregone if we used the materials that was regularly used in some other production and there was no replacement of it.
Similarly if labour was limited and we brought the workers to work for a new project and leave the existing project then the relevant cost I thought would be just the opportunity cost of the contribution foregone. But it's written that it's labour cost + contribution foregone.
If this is the case, then why don't we account the same for materials as well?
Thank you. :)