Learn how to track AWS EC2 costs for multiple projects efficiently using cost allocation tags. Discover the best practices for cost management in the AWS Certified Cloud Practitioner CLF-C02 exam.
Table of Contents
Question
A company is running applications on Amazon EC2 instances in the same AWS account for several different projects. The company wants to track infrastructure costs for each of the projects separately. The company must perform this tracking with the least possible impact on existing infrastructure and at no additional cost.
A. Use a different Amazon EC2 instance type for each project.
B. Publish project-specific Amazon CloudWatch custom metrics for each application.
C. Deploy EC2 instances for each project in a separate AWS account.
D. Use cost allocation tags with values specific to each project.
Answer
D. Use cost allocation tags with values specific to each project.
Explanation
The correct answer is D because cost allocation tags are a way to track infrastructure costs for each of the projects separately. Cost allocation tags are key-value pairs that can be attached to AWS resources, such as EC2 instances, and used to categorize and group them for billing purposes. The other options are incorrect because they do not meet the requirements of the question. Using a different Amazon EC2 instance type for each project does not help track the costs of each project and may impact the performance and compatibility of the applications. Publishing project-specific Amazon CloudWatch custom metrics for each application does not help track the costs of each project and may incur additional costs for using CloudWatch. Deploying EC2 instances for each project in a separate AWS account helps track the costs of each project but impacts the existing infrastructure and incurs additional costs for using multiple accounts.
To track infrastructure costs for different projects in a single AWS account, the most efficient and cost-effective solution is to use AWS cost allocation tags. Here’s why this is the best option:
What Are Cost Allocation Tags?
Cost allocation tags are key-value pairs that you can assign to AWS resources (e.g., EC2 instances, S3 buckets). These tags help categorize and organize resources based on business needs, such as projects, departments, or environments.
Once activated in the AWS Billing and Cost Management console, these tags allow you to generate detailed cost reports using tools like the AWS Cost Explorer or Cost and Usage Report (CUR).
Why This Solution Is Ideal
Minimal Impact on Existing Infrastructure: Tags can be applied to existing resources without requiring downtime or configuration changes.
No Additional Cost: Tagging is a built-in feature of AWS and does not incur extra charges.
Granular Tracking: Tags enable you to track costs at a detailed level, allowing you to attribute expenses to specific projects or teams.
Flexibility: You can define custom tags (e.g., Project: Alpha, Project: Beta) tailored to your organizational needs.
Other Options Analyzed
A. Use a different Amazon EC2 instance type for each project: This approach is impractical and inefficient because instance type selection should be based on workload requirements, not cost tracking. It also complicates resource management.
B. Publish project-specific Amazon CloudWatch custom metrics for each application: While CloudWatch metrics are useful for monitoring performance, they are not designed for cost tracking and would incur additional costs.
C. Deploy EC2 instances for each project in a separate AWS account: Managing multiple AWS accounts adds administrative overhead and complexity. It also contradicts the requirement of minimal impact on existing infrastructure.
Best Practices for Using Cost Allocation Tags
Use consistent naming conventions for tag keys and values (e.g., Environment: Production, Project: Alpha).
Activate tags in the Billing and Cost Management console to include them in cost reports.
Regularly audit your tagging strategy to ensure all resources are properly tagged.
By leveraging cost allocation tags, companies can efficiently track project-specific costs while adhering to the requirements of minimal impact and no additional expense. This aligns perfectly with the scenario described in the question. This solution is critical knowledge for candidates preparing for the AWS Certified Cloud Practitioner CLF-C02 exam, as it demonstrates foundational understanding of AWS billing and cost management concepts.
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