Costs are classified as follows:
1. Development Cost:
Salaries of system development staff.
Cost of conversion of data files.
Cost of testing the system.
Cost of new or expanded computer facilities.
2. Operating Cost:
Hardware/Software rent or depreciation.
Salaries of computer staff.
Cost of input data preparation & control.
Cost of data processing supplier.
3. Intangible Cost:
These can not be easily measured is terms of money, e.g. : loss in employees productivity due to loss of morale, loss of goodwill due to initial system errors.