Cost of Money

In building one of my reports for the DCAA today it occured to me that I have no idea what Cost of Money is. Can anyone here give me an elementary education on this?

Google turned up:

Which I read as a way of paying a contractor for interest he could have earned on certain capital if he wasn’t forced to use it as part of the contract.

More precisely, it’s called the weighted average cost of capital (WACC). Think of it as a firm’s overall required rate of return, and is used to decide if projects (which will cost money) can be economically justified.

I found the same article when I was Googling it, but your explanation ties it all together. Thanks.