Walmart Inc. operates retail stores and distribution centers globally. In August 2026, the company incurs the following operating costs across its supply chain operations:

• Distribution Center Costs: $40 million
• Inventory Handling Costs: $15 million
• Transportation Costs: $25 million
• Inventory Management Costs: $10 million
• Supplier Relationship Costs: $5 million

Required:

• Allocate operating costs to distribution centers and retail stores using the step-down allocation method.
• Determine the cost per unit delivered assuming 10 million units shipped.
• Analyze the cost structure of operating costing in the retail supply chain.
• Discuss the role of cost allocation in managing supply chain costs at Walmart Inc.
• Prepare an operating costing statement for Walmart Inc.'s supply chain segment.