FedEx Corporation provides logistics services using operating costing. In March 2032, the company incurs the following operating costs:

• Sorting Center Rent: $30 million
• Package Handling Labor: $40 million
• Transportation Costs: $25 million
• Customer Support: $10 million
• Selling Expenses: $20 million
• Distribution Expenses: $15 million

Required:

• Allocate operating costs to sorting, handling, and transportation operations.
• Determine the cost per package delivered assuming 100 million packages processed.
• Analyze the cost structure and profitability of FedEx Corporation's logistics operations.
• Discuss the role of cost allocation in managing operating costs.
• Prepare an operating costing statement for FedEx Corporation.