There are nowhere near 70k engineers working on this - I'd be surprised if even 7k - but this has been in development for years, and will be in development for a few more.
Depending on how many headsets they planned to deliver - I wouldn't be surprised if they each cost more than $1k - there are like 60k infantry soldiers - so that could easily cost >$60M.
I'd imagine they spent >$100M lobbying on this and Jedi.
I can't see how this would cost anywhere near $22Bn - but military contractors are known to have profit margins >30%.
I'm obviously missing a lot of things - but I wouldn't be surprised if this cost MSFT >$10Bn.