Resource tagging for cost tracking in AWS - Mini Project: Build & Apply

Resource tagging for cost tracking

📖 Scenario: You work in a company that uses AWS cloud services. To keep track of costs, your team wants to tag resources with specific labels. These tags help identify which department or project owns each resource.For this project, you will create AWS EC2 instances with tags that specify the Department and Project. This will help the finance team track spending accurately.

🎯 Goal: Create an AWS CloudFormation template that launches an EC2 instance with the exact tags Department: Finance and Project: Budget2024. This template will be used to deploy tagged resources for cost tracking.

📋 What You'll Learn

Create a CloudFormation template with an EC2 instance resource

Add a parameter for the EC2 instance type

Add tags Department with value Finance and Project with value Budget2024 to the EC2 instance

Use best practices for CloudFormation syntax and structure

💡 Why This Matters

🌍 Real World

Tagging AWS resources helps companies track costs by department or project, making budgeting and billing clearer.

💼 Career

Cloud architects and engineers often create templates with tags to organize resources and enable cost allocation reports.

1

Create the basic CloudFormation template with EC2 instance

Create a CloudFormation template with a resource named MyEC2Instance of type AWS::EC2::Instance. Set the InstanceType property to t2.micro and use the Amazon Linux 2 AMI ID ami-0c55b159cbfafe1f0 for ImageId.

AWS

# Your code here

Need a hint?

Start with the Resources section. Define MyEC2Instance with the correct type and properties.

2

Add a parameter for the EC2 instance type

Add a Parameters section with a parameter named InstanceTypeParam. Set its type to String and default value to t2.micro. Then update the InstanceType property of MyEC2Instance to use this parameter with !Ref InstanceTypeParam.

AWS

Resources:
  MyEC2Instance:
    Type: AWS::EC2::Instance
    Properties:
      InstanceType: t2.micro
      ImageId: ami-0c55b159cbfafe1f0
# Add Parameters section and update InstanceType property to use the parameter
# Your code here

Need a hint?

Define the parameter at the top level. Use !Ref InstanceTypeParam to refer to it in the instance properties.

3

Add tags for Department and Project to the EC2 instance

Add a Tags property under MyEC2Instance with two tags: one with Key as Department and Value as Finance, and another with Key as Project and Value as Budget2024.

AWS

Parameters:
  InstanceTypeParam:
    Type: String
    Default: t2.micro
Resources:
  MyEC2Instance:
    Type: AWS::EC2::Instance
    Properties:
      InstanceType: !Ref InstanceTypeParam
      ImageId: ami-0c55b159cbfafe1f0
      # Add Tags property here
# Your code here

Need a hint?

Tags are a list of key-value pairs under the Tags property.

4

Add Outputs section with the EC2 instance ID

Add an Outputs section with an output named InstanceId. Set its Value to !Ref MyEC2Instance and add a Description of EC2 Instance ID.

AWS

Parameters:
  InstanceTypeParam:
    Type: String
    Default: t2.micro
Resources:
  MyEC2Instance:
    Type: AWS::EC2::Instance
    Properties:
      InstanceType: !Ref InstanceTypeParam
      ImageId: ami-0c55b159cbfafe1f0
      Tags:
        - Key: Department
          Value: Finance
        - Key: Project
          Value: Budget2024
# Add Outputs section below
# Your code here

Need a hint?

The Outputs section helps you see important information after deployment.