A company needs to classify resources and track AWS costs at a detailed level by department, environment, and application. Which approach will meet this requirement?

Applying tags to resources and enabling cost allocation tags is the correct approach because tags are key-value pairs that you can assign to AWS resources. When enabled as cost allocation tags, AWS uses them to categorize and track costs across different dimensions like department, environment, or application within cost management tools. This allows for detailed cost reporting and analysis. Opening the AWS Cost Management console helps with overall budget management and alerts but doesn't provide the granular classification needed for detailed cost tracking by specific categories. Building Amazon CloudWatch dashboards is for monitoring operational metrics, not for organizing and allocating costs based on business dimensions. The AWS Billing and Cost Management dashboard provides an overview of costs but requires cost allocation tags to break down expenses by custom categories.