- A
AWS Budgets
Why wrong: Budgets sets cost thresholds and alerts. While it can be filtered by tag, it is not the feature that attaches team labels to resources and enables cost reporting by team.
- B
AWS Cost Allocation Tags
Cost Allocation Tags let teams tag resources with metadata (e.g., Team=Engineering). After activating these tags in the billing console, AWS includes them in cost reports so spending can be broken down and attributed to each team.
- C
AWS Organisations consolidated billing
Why wrong: Consolidated billing combines costs from multiple accounts into one bill. It supports per-account reporting but not per-team reporting within a single account without tagging.
- D
AWS Cost and Usage Report
Why wrong: The CUR is the report that includes tag data, but the tags themselves must be created and activated separately. Cost Allocation Tags is the feature that enables tagging and cost attribution.
CLF-C02 Billing, Pricing, and Support Practice Question
This CLF-C02 practice question tests your understanding of billing, pricing, and support. Match the stated requirement to the specific cloud service, access model, or configuration option — many options are valid in isolation but not for this scenario. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A company runs workloads for multiple teams in a single AWS account and wants to track and report costs per team in their monthly AWS bill. Which feature allows them to categorise and report AWS costs by team?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
AWS Cost Allocation Tags
AWS Cost Allocation Tags allow you to tag AWS resources with team-specific metadata (e.g., 'Team: Engineering') and then activate those tags in the Billing and Cost Management console. Once activated, AWS generates cost reports that group and summarize charges by those tags, enabling per-team cost tracking in the monthly bill. This is the correct feature because it directly categorizes costs at the resource level and reports them in billing data.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
AWS Budgets
Why it's wrong here
Budgets sets cost thresholds and alerts. While it can be filtered by tag, it is not the feature that attaches team labels to resources and enables cost reporting by team.
- ✓
AWS Cost Allocation Tags
Why this is correct
Cost Allocation Tags let teams tag resources with metadata (e.g., Team=Engineering). After activating these tags in the billing console, AWS includes them in cost reports so spending can be broken down and attributed to each team.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
AWS Organisations consolidated billing
Why it's wrong here
Consolidated billing combines costs from multiple accounts into one bill. It supports per-account reporting but not per-team reporting within a single account without tagging.
- ✗
AWS Cost and Usage Report
Why it's wrong here
The CUR is the report that includes tag data, but the tags themselves must be created and activated separately. Cost Allocation Tags is the feature that enables tagging and cost attribution.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse AWS Budgets (which only alerts on cost thresholds) with cost categorization features, or assume the Cost and Usage Report inherently groups costs by team without needing tags.
Detailed technical explanation
How to think about this question
Cost allocation tags can be user-defined (custom tags) or AWS-generated tags (e.g., aws:createdBy). After creating tags on resources like EC2 instances or S3 buckets, you must activate them in the Billing console under 'Cost Allocation Tags' — only activated tags appear in cost reports. A common real-world scenario is a company using multiple tags (e.g., 'Project', 'Environment', 'Team') to slice costs in the AWS Cost Explorer, enabling granular chargeback or showback to business units.
KKey Concepts to Remember
- Read the scenario before looking for a memorised answer.
- Find the constraint that changes the correct option.
- Eliminate answers that are true in general but not in this case.
TExam Day Tips
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A startup's cloud architect reviews their monthly bill and notices costs are higher than expected for a long-running batch job. Switching from on-demand instances to Reserved Instances — or using Spot/Preemptible VMs — can reduce compute costs by up to 72 %. Questions like this test whether you understand the tradeoffs between commitment, flexibility, and cost across cloud pricing models.
What to study next
Got this wrong? Here's your next step.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
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Billing, Pricing, and Support — study guide chapter
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FAQ
Questions learners often ask
What does this CLF-C02 question test?
Billing, Pricing, and Support — This question tests Billing, Pricing, and Support — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: AWS Cost Allocation Tags — AWS Cost Allocation Tags allow you to tag AWS resources with team-specific metadata (e.g., 'Team: Engineering') and then activate those tags in the Billing and Cost Management console. Once activated, AWS generates cost reports that group and summarize charges by those tags, enabling per-team cost tracking in the monthly bill. This is the correct feature because it directly categorizes costs at the resource level and reports them in billing data.
What should I do if I get this CLF-C02 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
About these practice questions
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Last reviewed: Jun 11, 2026
This CLF-C02 practice question is part of Courseiva's free Amazon Web Services certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the CLF-C02 exam.
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