CLO-002 Premium Exam Questions

Monthly cloud service costs are best described as operating expenditures. Operating expenditures (OPEX) are the ongoing costs of running a business or a service, such as rent, utilities, salaries, maintenance, and subscriptions1. Cloud services are typically paid on a monthly or annual basis, depending on the usage and the service level agreement. Cloud services reduce the need for capital expenditures (CAPEX), which are the upfront costs of acquiring assets, such as hardware, software, or infrastructure1. Fixed expenditures are the costs that do not change regardless of the level of output or activity, such as rent or insurance2. Personnel expenditures are the costs of hiring, training, and retaining employees, such as salaries, benefits, or taxes3. References: CompTIA Cloud Essentials+ Certification | CompTIA IT Certifications, CompTIA Cloud Essentials CLO-002 Certification Study Guide, Fixed Costs Definition, Personnel Costs Definition

 A project charter is a document that defines the scope, objectives, and stakeholders of a project. It also provides a high-level overview of the project’s benefits, risks, assumptions, constraints, and deliverables. A project charter is used to gain the support and approval of upper management and other key stakeholders before initiating a project. A project charter is one of the outputs of the cloud assessment process, which involves evaluating the feasibility, suitability, and readiness of an organization to adopt cloud services. References: CompTIA Cloud Essentials+ (CLO-002) Study Guide, Chapter 4: Cloud Assessment, Section 4.1: Cloud Assessment Process, page 9712; CompTIA Cloud Essentials+ Certification Exam Objectives, Objective 4.1: Given a scenario, analyze and report the outputs of a cloud assessment, page 143

Capital expenditures are costs that a business incurs to acquire or improve long-term assets that will provide benefits beyond the current year. Capital expenditures are also known as PP&E, which stands for Property, Plant, and Equipment. Capital expenditures are usually one-time purchases of fixed assets that have a high initial cost and a long useful life. Capital expenditures are recorded as assets on the balance sheet and depreciated over time12

Data center wiring and server purchases are examples of capital expenditures, because they are part of the physical infrastructure that supports the IT operations of a business. Data center wiring and server purchases have a high upfront cost and a long lifespan, and they provide benefits for several years. Data center wiring and server purchases are also recorded as assets on the balance sheet and depreciated over time34

Cloud consultant fees, data center electric bill, spot instances, and disposable virtual machines are not examples of capital expenditures, but rather operating expenses. Operating expenses are costs that a business incurs to run its day-to-day operations and generate revenue. Operating expenses are also known as OPEX, which stands for Operating Expenses. Operating expenses are usually recurring payments for variable or consumable resources that have a low cost and a short useful life. Operating expenses are recorded as expenses on the income statement and deducted from revenue to calculate profit12

Cloud consultant fees are operating expenses, because they are payments for professional services that help a business implement or optimize its cloud strategy. Cloud consultant fees are recurring payments that vary depending on the scope and duration of the project, and they do not result in the acquisition or improvement of any long-term assets. Cloud consultant fees are also recorded as expenses on the income statement and deducted from revenue to calculate profit5

Data center electric bill is an operating expense, because it is a payment for the utility service that powers the data center equipment. Data center electric bill is a recurring payment that varies depending on the consumption and the rate of electricity, and it does not result in the acquisition or improvement of any long-term assets. Data center electric bill is also recorded as an expense on the income statement and deducted from revenue to calculate profit.

Spot instances and disposable virtual machines are operating expenses, because they are payments for cloud computing resources that are available on-demand and for a short duration. Spot instances and disposable virtual machines are recurring payments that vary depending on the usage and the market price of the resources, and they do not result in the acquisition or improvement of any long-term assets. Spot instances and disposable virtual machines are also recorded as expenses on the income statement and deducted from revenue to calculate profit.

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