C7 License, Law, and Business Test #1

Question 1

Double cleat ladders must not exceed ____ feet in length.

20
25
30
40

Answer 1

30

Question 2

A contractor doing a remodeling job finds numerous code violations that were done prior to his/her work being started. He/she should:

report the violations to the building inspector.
report the violations to the owner accompanied with an estimate for the repairs that are needed.
make immediate repairs to bring everything up to code.
do nothing until the Building Department presents a list of corrections.

Answer 2

report the violations to the owner accompanied with an estimate for the repairs that are needed.

Question 3

After the filing of the “Notice of Completion” by the owner, the original contractors have:

20 days to file their Mechanics’ Liens against the job.
30 days to file their Mechanics’ Liens against the job.
60 days to file their Mechanics’ Liens against the job.
90 days to file their Mechanics’ Liens against the job.

Answer 3

60 days to file their Mechanics’ Liens against the job.

Question 4

A contractor, when starting work on any building that has been constructed prior to __________, must first ascertain whether there is asbestos present in the area in which the work will be performed.

1972
1978
1984
1990

Answer 4

1978

Question 5

A contractor that fails to carry a valid policy of Workers’ Compensation Insurance cannot:

take a job valued at over $500.
maintain a contracting business.
have employees.
All of the above

Answer 5

have employees

Question 6

A contractor finds a 12″ discrepancy on a set of drawings for an office building. The contractor should:

• contact the owner.
• contact the architect or designer.
• make the correction and get on with the job.
• do all of the above.

Answer 6

contact the architect or designer.

Question 7

A contractor may disregard an owner’s plans or specifications if:

• he knows that he can improve upon them and give the owner a better job.
• the owner gives the contractor written permission.
• the contractor finds a better construction method.
• the contractor can save money.

Answer 7

the owner gives the contractor written permission.

Question 8

A construction contract was written containing the following time estimates to complete the job. It would take 2 days to ready the construction site and then the job itself would be done in 2 phases. The first phase would take 10 days and the second would take 7 days, but these 2 phases could be at the same time. In addition, it would take an additional 1 day at the end to clean up. Actually, how many days would it take to complete this project?

• 15 days
• 13 days
• 11 days
• 7 days

Answer 8

13 days

Question 9

A contractor must pay Federal Unemployment Tax (FUTA) yearly to the IRS if:

• he/she has one or more employees.
• he/she is in a partnership.
• he/she has ten or more employees.
• his/her payroll is less than $100.

Answer 9

he/she has one or more employees.

Question 10

A short term loan should not be obtained to cover which of the following?

• Materials
• Project loan
• Rent
• Payroll

Answer 10

Rent

Question 11

A contractor has a contract with Tom Jones to construct a room addition. The contractor is required by the City to have a City License and he/she must obtain a building permit. In order to get the permit he/she must provide his/her:

• license classification.
• license classification and license number.
• license number & Workers’ Compensation Certificate.
• license classification, license number, Workers’ Compensation Certification or equivalent.

Answer 11

license classification, license number, Workers’ Compensation Certification or equivalent.

Question 12

Bodily contact with the stream of abrasive material presents a constant danger. What other hazard exists for the workers using abrasive blasting?

• Lack of oxygen
• Explosion of the air tank
• Dust from removed rust and scale
• Low pressure

Answer 12

Dust from removed rust and scale

Question 13

“Fixed assets” are:

• such things as land, buildings, machinery, furniture, fixtures, etc. These are assets used to run the business. . . not for resale.
• cash plus inventory.
• current assets.
• current liabilities.

Answer 13

such things as land, buildings, machinery, furniture, fixtures, etc. These are assets used to run the business. . . not for resale.

Question 14

A construction permit is not required for the installation of a(n):

• 115 volt receptacle.
• fire rated door.
• 80 square feet of roofing.
• 200 square foot utility shed.

Answer 14

200 square foot utility shed.

Question 15

A Form I-9 must be filled out by which of the following employees?

• Every employee
• Rehired employees
• Newly hired employees
• Employees that are not U. S. citizens

Answer 15

Every employee

Question 16

A contractor has a contract with the homeowner and the job is progressing along very well. One day the homeowner comes up with six different changes, three small ones and three rather large ones which he would like done. The contractor has four other jobs backed up waiting for him. What should he do?

• Refuse the work
• Tell the homeowner that the additional work will be added to his original contract and get the work done as soon as possible.
• Provide an estimate and change order contract for each of the different changes. If the homeowner still wants the work and signs each contract then the contractor should get the work done as soon as possible.
• Tell the homeowner that he will do the three small jobs but that he doesn’t have time to do the larger jobs.

Answer 16

Provide an estimate and change order contract for each of the different changes. If the homeowner still wants the work and signs each contract then the contractor should get the work done as soon as possible.

Question 17

A contractor signs a Home Improvement Contract and accepts a down payment but never shows up to do the work. Which statement is correct concerning this action?

• The contract is automatically canceled in 30 days.
• The contractor is subject to penalty of $100 – $5000 and/or one year in jail.
• The contractor’s license will be automatically revoked for one year.
• All of the above

Answer 17

The contractor is subject to penalty of $100 – $5000 and/or one year in jail.

Question 18

Mr. Smith has approached a contractor (Mr. Jones) asking for a bid on the construction of a building for which Smith has drawn plans. Jones has found numerous items in the plans that conflict with current building codes, but Smith has said that he wants the building to be built exactly as he has drawn the plans. Jones, a contractor, should therefore:

• advise Mr. Smith that the building code must be followed, even if he loses the job.
• take the job but build according to code.
• consult with Mr. Smith’s wife.
• build it the way the owner wishes.

Answer 18

advise Mr. Smith that the building code must be followed, even if he loses the job.

Question 19

A contractor finished a job and found that it was not up to code. Which of the following would be responsible for this problem?

• The prime contractor
• The subcontractor
• The building inspector
• The architect

Answer 19

The prime contractor

Question 20

A contractor bids for a job for an owner. The owner has added “extra” items to be bid upon. Receiving the bid, the owner claims it is too high and tells the contractor to lower the price. What should the contractor do?

• Refuse the work in its entirety.
• Lower the bid basically to cost plus overhead.
• Lower the bid to cost with the hopes of recovering the overhead at another time through another job for the same owner.
• Try to negotiate in order to lessen the extent of the job, thereby eliminating some extras.

Answer 20

Try to negotiate in order to lessen the extent of the job, thereby eliminating some extras.

Question 21

A contractor accepts work on a time and materials basis. His pricing should be based on:

• adding his intended profit and overhead only to labor.
• adding his intended profit and overhead only to materials.
• adding profit and overhead to labor and materials only.
• none of the above.

Answer 21

adding profit and overhead to labor and materials only.

Question 22

A construction superintendent should visit each jobsite that he/she supervises at least:

• whenever near the job.
• once a day.
• twice a week.
• four times a month.

Answer 22

once a day.

Question 23

A contractor’s gross profit for a project is determined by which of the following?

• Amount of contract – direct costs – indirect costs = gross profit
• Amount of contract – indirect costs = gross profit
• Amount of contract – labor – materials = gross profit
• Amount of contract – direct cost – indirect costs – general overhead – income taxes = gross profit

Answer 23

Amount of contract – direct costs – indirect costs = gross profit

Question 24

A “class 2” fire hazard means there is/are ______ present.

• flammable material
• dust
• textiles
• all of the above

Answer 24

flammable material

Question 25

A contractor estimates the direct costs for a project at $17,000. The project overhead expenses are generally 20 percent of the direct costs. In order to make a 20 percent profit on this project, the bid must be:

• $20,400.00
• $23,800.00
• $24,480.00
• $25,500.00

Answer 25

$24,480.00

Question 26

___________ on the ends of dimension lines limit each dimension on a print.

• Arrows.
• Dots.
• Slashes.
• All of the above.

Answer 26

all of the above

Question 27

A contractor deliberately passes over a contracted portion of a job. The resultant dispute with the owner goes to arbitration. The finding is for the owner. The contractor must:

• correctly complete the entire job.
• complete the job as contracted and repay the owner for lost time and costs incurred.
• complete the job and pay a $1000.00 fine.
• None of the above

Answer 27

complete the job as contracted and repay the owner for lost time and costs incurred.

Question 28

A contractor sent a bill to his/her client which was due to be paid, according to their contract, by the 10th of the month. The bill has still not been paid and is now twenty days overdue. What is the best course of action, of those shown below, for the contractor to follow?

• Turn the bill over to a collection agency
• Immediately lien the property
• Use it as a write-off against taxes
• Send the client a second bill and a letter of explanation

Answer 28

Send the client a second bill and a letter of explanation

Question 29

A contractor may purchase Workers’ Compensation Insurance from:

• the State Contractors’ Board.
• the State Fund Insurance or a private insurance company.
• both A and B.
• none of the above.

Answer 29

the State Fund Insurance or a private insurance company.

Question 30

A Stop Notice, which is a claim for payment to a subcontractor, inhibits payment from:

• the prime contractor to the subcontractor.
• the property owner to the prime contractor.
• the property owner to the subcontractor.
• the property owner to the supplier of materials.

Answer 30

the property owner to the prime contractor.

Question 31

After plans have been approved by the Building and Safety Department, the next thing to do is:

order materials.
hire subcontractors.
demand a deposit.
schedule the job.

Answer 31

schedule the job.

Question 32

A client must submit a claim for service or repair of a defect on fit and finish items after a job completion by:

• overnight mail
• personal delivery
• certified mail
• All of the above are correct

Answer 32

All of the above are correct

Question 33

A contractor may disregard plans and specifications if he knows a better method of construction, but only with the consent of the:

• owner.
• subcontractors.
• architect.
• engineer.

Answer 33

owner

Question 34

A contractor’s license is not necessary if a job is priced less than _____ including labor, services and materials.

• $500.00
• $400.00
• $300.00
• $250.00

Answer 34

$500

Question 35

__________ are not covered by a contractor’s insurance policies.

• Burglaries of job materials
• Vandalism damage
• Tools owned by the employees
• Damage caused by weather problems

Answer 35

Tools owned by the employees

Question 36

A Balance Sheet will show:

• revenues and expenses over an extended period of time.
• revenues and expenses at a certain time.
• assets and liabilities over an extended period of time
• assets and liabilities and net worth at a certain time.

Answer 36

assets and liabilities and net worth at a certain time.

Question 37

A contractor should not seek a short term loan for:

• office rent.
• materials.
• salaries.
• bid bond.

Answer 37

office rent

Question 38

A contractor should include material, labor and direct costs, permits, profit and ___________, when bidding on a Home Improvement Contract.

• overhead costs
• repairs
• direct labor
• materials for the job

Answer 38

overhead costs

Question 39

A debit is:

• an increase in value.
• an increase in value for the asset account.
• a decrease in value.
• a decrease in value for the asset account.

Answer 39

an increase in value for the asset account.

Question 40

A contractor collects Sales Tax; how often does he have to prepare his return?

• Weekly
• Monthly
• Quarterly
• Yearly

Answer 40

Quarterly

Question 41

A contract to be awarded by the State Public Works authority which involves an amount of over $25,000 for the digging of a trench with a depth of 5 feet or more cannot be awarded until:

• a Civil Engineer ôsign-off” signature is on the plans.
• the contractor fully understands the work that is to be done.
• it contains a requirement stating that the contractor will submit plans illustrating the scope of shoring, bracing, etc. to give protection from cave-ins.
• the contractor obtains a valid specific license that will permit him to be involved in this type of work.

Answer 41

it contains a requirement stating that the contractor will submit plans illustrating the scope of shoring, bracing, etc. to give protection from cave-ins.

Question 42

A contractor has signed an agreement to construct a building on a State University campus. Which of the following state agencies should the contractor contact for disabled access approval?

• Office of State Architect
• Department of Rehabilitation
• Department of Housing and Community Development
• All of the above

Answer 42

Office of State Architect

Question 43

A decrease in value of a fixed asset due to wear or passage of time is known as:

• commission.
• draw.
• depreciation.
• working capital.

Answer 43

depreciation

Question 44

A contractor has asked for proof of insurance from one of his/her subs. The sub is working on a very long-term job. The best way that the contractor can insure that the subcontractor will have insurance coverage during the entire length of the project is:

• the contractor should contact the subcontractor at regular intervals and question whether or not the insurance is still valid.
• he/she should leave the responsibility of insurance to the subcontractor.
• the contractor in his/her subcontract specifications should require the submission and proof of renewal of the subcontractor’s insurance policy.
• he/she should request the information when needed.

Answer 44

the contractor in his/her subcontract specifications should require the submission and proof of renewal of the subcontractor’s insurance policy.

Question 45

A contractor has advertised a job which requires heavy lifting as a job requirement. A person 41 years old applies, but he/she can not do any heavy lifting; the contractor:

• would not have to hire anyone over 40.
• can not discriminate because of age.
• can hire anyone he/she wants.
• does not have to hire him/her since he/she does not meet his/her requirements.

Answer 45

does not have to hire him/her since he/she does not meet his/her requirements.

Question 46

A contractor gets into a disagreement with the owner and walks off the job. The owner sues for breach of contract and wins. The owner is entitled to:

• his/her economic loss.
• as much as he/she can get.
• a finished job and lost profits.
• lost depreciation.

Answer 46

a finished job and lost profits.

Question 47

A developer purchases a small parcel of underdeveloped land for $750,000.00 according to the following terms: $100,000 in cash with a mortgage of $650,000 payable in full in 5 years, with interest at 10 percent payable quarterly. How much cash will this contract cost the purchaser, when the contract is closed?

• $100,000.00
• $100,000 plus interest quarterly
• $650,000
• $750,000 plus interest quarterly

Answer 47

$100,000.00

Question 48

A signed copy of the contract shall be furnished to the owner or tenant:

• at least two weeks after the work has been started.
• before the work is started.
• the day after work has started.
• three days before the work is started.

Answer 48

before the work is started.

Question 49

Except for C-8, C-20, C-22 and D-49, a contractor does not have to have Workers’ Compensation if:

his/her employee signs a waiver releasing him/her from any liability.
he/she has no employees.
he/she only has 1 employee.
he/she hires a relative only for an employee.

Answer 49

he/she has no employees.

Question 50

A citation issued by the Registrar can include an order of correction, fixing a reasonable time for correction of the violation and may also contain:

• a mandatory suspension.
• a mandatory jail sentence.
• an assessment of a civil penalty (fine).
• none of the above.

Answer 50

an assessment of a civil penalty (fine).

Question 51

A contractor should use his bookkeeping books for:

• establishing and maintaining his goals.
• keeping track of costs.
• estimating taxes.
• all of the above.

Answer 51

all of the above

Question 52

A construction contract contained all the specifics that were basically necessary with the exception that there is wording that is somewhat vague. Which of the following is MOST right?

• A vague phrase renders the contract null and void.
• Construction contracts very often appear to be vague because of a wide number of interpretations that exist in the construction industry.
• It is of primary importance in construction contracts to exclude wording that is not readily understandable and to define all specifications as clearly as possible.
• This practice is the prevalent standard format in construction contracts and is acceptable.

Answer 52

It is of primary importance in construction contracts to exclude wording that is not readily understandable and to define all specifications as clearly as possible.

Question 53

A contractor must keep a copy of these safety orders, those which apply to his own field of contracting, on the job at all times.

• True
• False

Answer 53

True

Question 54

__________ of the contractor members shall be General Building Contractors.

• One (1)
• Two (2)
• Three (3)
• Four (4)

Answer 54

Two (2)

Question 55

A construction elevator, as well as stairways, are required for structures or buildings ____ feet or more below ground level or ____ feet above ground.

• 50 – 50
• 40 – 60
• 48 – 60
• 30 – 60

Answer 55

48 – 60

Question 56

A contracting business needs:

• sufficient resources for attracting business
• an area with sufficient construction activity.
• both A and B.
• neither A nor B.

Answer 56

both A and B.

Question 57

__________ must be included in a contract.

• The job number
• Contractor’s name
• Contractor’s address
• The approximate completion date

Answer 57

The approximate completion date

Question 58

A builder starts a construction company with $100,000 in cash and other assets. A year later, the company’s income statement shows that sales were $85,000 & net profit was $9,500. The return on investment was:

• 9.5 percent.
• 11.0 percent.
• 10.4 percent.
• 11.6 percent.

Answer 58

9.5 percent.

Question 59

___________ which cause little or no profit on the job are often not figured by contractors.

• Closed costs
• Open costs
• Controlled extras
• A solid completion date

Answer 59

Open costs

Question 60

A contractor finished a job and found that it was not up to code. Which of the following would be responsible for this problem?

• The prime contractor
• The subcontractor
• The building inspector
• The architect

Answer 60

The prime contractor

Question 61

After the filing of the “Notice of Completion” by the owner, the subcontractors, laborers, materialmen, etc. shall file their Mechanics’ Liens within:

• 20 days.
• 30 days.
• 60 days.
• 90 days.

Answer 61

30 days

Question 62

A 20 day Public Works Preliminary Lien Notice:

• is required for private and public works.
• is a necessary prerequisite to enforce a claim on a payment bond.
• can be given by a claimant who has a direct contractual relationship with the original contractor.
• Both A and B

Answer 62

is a necessary prerequisite to enforce a claim on a payment bond.

Question 63

According to Cal/OSHA, the ground within ____ of buildings under construction should be kept reasonably free of irregularities wherever it is practicable.

• 4 ft.
• 5 ft.
• 6 ft.
• 7 ft.

Answer 63

6 ft.

Question 64

A company has just purchased its own building; depreciation must be calculated using:

• the 10 year class.
• the 26.5 year straight line.
• the 31.5 year straight line.
• the declining balance.

Answer 64

the 31.5 year straight line.

Question 65

A 5/8″ manila rope will break under a load of:

• 3,000 lbs.
• 6,500 lbs.
• 2,300 lbs.
• 4,400 lbs.

Answer 65

4,400 lbs.

Question 66

A competitive bid contract is:

• a lump sum and unit price contract.
• when the contractor buys all materials and charges the owner 20 percent profit.
• when the contractor works by the hour at a predetermined rate.
• a cost plus fee contract.

Answer 66

a lump sum and unit price contract.

Question 67

A 90 day Preliminary Lien Notice on a Public Works is:

• to protect the owner.
• served with the director of the department which let the contract.
• served after the work is completed.
• served before the work is completed.

Answer 67

served with the director of the department which let the contract.

Question 68

A capacity plate must be posted inside the car and ropes must be inspected and records kept. How often must the ropes be inspected?

• Every 10 days
• Every 15 days
• Every 20 days
• Every 30 days

Answer 68

Every 30 days

Question 69

After the contract has been finished and the owner requests additional work, what should the contractor do?

• Get the money first.
• Have the owner sign a change order.
• Attach the changes to the old contract.
• Have a verbal agreement with the owner.

Answer 69

Have the owner sign a change order.

Question 70

A contractor’s bid is correct if:

• it shows a large profit.
• the actual cost is just below the estimated cost.
• he/she is getting more jobs than he/she can handle.
• the actual cost is just above the estimated cost.

Answer 70

the actual cost is just above the estimated cost.

Question 71

A fiscal year and a calendar year:

• are never the same.
• are always the same.
• may start and end on the same days.
• None of the above

Answer 71

may start and end on the same days.

Question 72

A contractor licensed as a General Building Contractor may advertise as a __________ if his B License is current and active.

• Roofing Contractor
• Plumbing Contractor
• Electrical Contractor
• General Building Contractor

Answer 72

General Building Contractor

Question 73

A C-53 Swimming Pool Contractor must furnish a ________ bond or cash to be kept on file with the Registrar in order to maintain a valid license.

• $5,000
• $2,500
• 25,000
• $7,500

Answer 73

$25,000

Question 74

A contractor receives a notice from the Employment Development Department (EDD) that one of his former employees has filed a claim for Unemployment Insurance (UI) benefits against his reserve account. He/she may:

• call EDD within 5 days and protest.
• protest, in writing, within 10 days of the mailing date of the notice.
• protest, in writing, within 30 days of the mailing date.
• protest, in writing, within 45 days of the mailing date.

Answer 74

protest, in writing, within 10 days of the mailing date of the notice.

Question 75

A contractor should do which of the following to guarantee that there will be enough capital to meet the expenses?

• Establish a line of credit prior to starting business drawing on it only if absolutely needed
• Be certain that the company has enough money prior to starting a business
• Borrow whatever amount of money that he/she thinks the company will need that year
• Not start a business without enough capital

Answer 75

Establish a line of credit prior to starting business drawing on it only if absolutely needed

Question 76

A contractor’s license is not necessary if a job is priced less than _____ including labor, services and materials.

• $500.00
• $400.00
• $300.00
• $250.00

Answer 76

$500

Question 77

A California Contractor’s License is required for any construction work that is done in this State for which the total cost of labor, services and materials (combined) is ___________ or more.

• $250.00
• $300.00
• $400.00
• $500.00

Answer 77

$500

Question 78

A contractor that fails to carry a valid policy of Workers’ Compensation Insurance cannot:

• take a job valued at over $500.
• maintain a contracting business.
• have employees.
• All of the above

Answer 78

Have employees

Question 79

As a Project Manager, which of the following is the single most important aspect of managing a job in the field?

• Good knowledge of all trades in the job
• Personally inspecting all work being done at the job-site on a daily basis for quality and comparing it to the schedule of work
• Being able to read and understand the plans and specs for the job
• Bringing the subcontractors together at the right time

Answer 79

Personally inspecting all work being done at the job-site on a daily basis for quality and comparing it to the schedule of work

Question 80

A contractor hiring a person does not have to have Workers’ Compensation insurance if the employee is hired for pay less than:

• $200.00.
• $300.00.
• $500.00.
• He/she has to insure the employee regardless of the amount.

Answer 80

He/she has to insure the employee regardless of the amount.

Question 81

A contractor’s income taxes are based on:

• the balance sheet.
• the income statement.
• gross profit.
• net profit.

Answer 81

net profit

Question 82

A contractor presents his lowest possible bid to a client. The client refuses to accept the bid claiming the price is too high. What should the contractor do?

• Lower the bid to cost and expect to make a profit based on extras
• Endeavor to have the customer reduce the size of the job
• Reduce the bid to cost and overhead only removing any excess profits
• If there is no ôfat” in the bid, maintain his/her original price or refuse the work

Answer 82

If there is no ôfat” in the bid, maintain his/her original price or refuse the work

Question 83

As shown on an invoice for materials, the term: 2 percent – 10th prog. net 15 means:

• a 2 percent discount can be taken off the invoice total if paid within 10 days of billing, etc.
• the net invoice total only will be paid from 10 to 15 days after invoicing.
• after 15 days there can be additional charges.
• all of the above.

Answer 83

all of the above

Question 84

As the prime contractor on the job, what are three of the main requirements before hiring a subcontractor?

• That he/she have a valid state contractors’ license, shows proof of workers’ compensation and that all of his/her employees have proper immigration papers
• That he/she have a valid state contractors’ license, show proof of liability insurance and that all of his/her employees have proper immigration papers
• That he/she have a valid state contractors’ license, show proof of workers’ compensation and liability insurance
• That he/she have a valid state contractors’ license, show proof of workers’ compensation and that he/she has completed his/her last three jobs on time in an acceptable manner

Answer 84

That he/she have a valid state contractors’ license, show proof of workers’ compensation and liability insurance

Question 85

A corporation pays Franchise Taxes on:

• net income.
• gross income.
• profit.
• net worth and borrowings.

Answer 85

net income

Question 86

A contractor’s bid was accepted for a complete project, but he/she accidentally omitted a part of the job from his/her bid. He should, therefore:

• add the additional costs for the omitted portion to the bid.
• do the work that was left out on a time and material basis.
• tell the customer of omission, show bid error and request withdrawal or change in price.
• proceed with the work even though it may cost a loss of monies.

Answer 86

A contractor’s bid was accepted for a complete project, but he/she accidentally omitted a part of the job from his/her bid. He should, therefore:

Question 87

A contract can be cancelled when there is consent through duress or fraud by the other party.

• True
• False

Answer 87

True

Question 88

A contractor’s license need not be displayed at the main place of business if:

• it is always available for inspection.
• the contractor carries the pocket card.
• it is displayed at the job site office.
• the license must always be displayed at the place of business.

Answer 88

the license must always be displayed at the place of business.

Question 89

A contractor has to file a Stop Notice with a Preliminary Notice within:

• 10 days.
• 20 days.
• 60 days.
• The Stop Notice is NOT filed with Preliminary Lien Notice.

Answer 89

The Stop Notice is NOT filed with Preliminary Lien Notice.

Question 90

A contractor must report all injuries or illnesses that are job-related to the Workers’ Compensation Insurance carrier within _________ of the occurrence.

• 1 day (24 hours)
• 3 days
• 5 days
• 10 days

Answer 90

5 days

Question 91

A contractor must start a job within ______ days of the specific date in the contract or be guilty of a misdemeanor unless there is a lawful excuse.

• 3
• 20
• 10
• 7

Answer 91

20

Question 92

A contractor is currently building an addition on an office building. The building was built in 1976. Which of the following statements is MOST true, according to the “Handicapped Access” Laws?

• Only the addition needs to be made handicapped accessible if the addition is over 200 sq. ft.
• Only the addition needs to be handicapped accessible and a “path of travel” to the remodeled area is generally required.
• The entire building must be made handicapped accessible since there is an addition being made to the building.
• The entire building must be made handicapped accessible if the addition cost more than $10,000.

Answer 92

Only the addition needs to be handicapped accessible and a “path of travel” to the remodeled area is generally required.

Question 93

A contractor should show the construction contract to his/her attorney:

• once the permit has been taken out.
• prior to reviewing it with the customer and prior to signing it.
• after reviewing it with the customer prior to signing.
• never – the attorney should not interfere.

Answer 93

prior to reviewing it with the customer and prior to signing it.

Question 94

A contractor’s most accurate method for scheduling the work to be done on a project is to:

• set up a pert chart.
• follow the scheduling as shown in the critical-path method.
• form a bar graph.
• base the schedule on information gathered from estimating books.

Answer 94

follow the scheduling as shown in the critical-path method.

Question 95

To increase liabilities that are generally represented by credit balances, you would:

• credit the liability.
• debit the assets.
• debit the owner’s equity.
• credit the assets.

Answer 95

credit the liability.

Question 96

A CPA advises a contractor to set up a cost management system. What will this program provide?

• It compares what others are charging for subcontract work.
• It gives a cost history for use in order to analyze labor and material costs.
• It shows where profits and losses are.
• It shows costs of material.

Answer 96

It gives a cost history for use in order to analyze labor and material costs.

Question 97

A contractor, working for the Perez Construction Co., observed an employee putting tools belonging to the company in his/her tool box and leaving the office. The contractor followed him/her out and asked for an explanation. The employee could not give an explanation and was ultimately fired. Is the employee entitled to unemployment benefits?

• No, absolutely not
• Yes and the reserve account for the company would be charged if it had a bad rating
• Yes and the reserve account would be charged
• If it was decided that he/she was entitled to unemployment benefits, the reserve account of the company would not be charged

Answer 97

If it was decided that he/she was entitled to unemployment benefits, the reserve account of the company would not be charged

Question 98

A drawing which is 1/48 actual size has a scale of:

• 1/8″ = 1′.
• 1/4″ = 1′.
• 3/16″ = 1′.
• 1/2″ = 1′.

Answer 98

1/4″ = 1′.

Question 99

A Federal Employer Identification Number is given to each employer by the:

• County Tax Assessor.
• Franchise Tax Board.
• Internal Revenue Service.
• Board of Equalization.

Answer 99

Internal Revenue Service.

Question 100

A contractor’s gross profit for a project is determined by which of the following?

• Amount of contract – direct costs – indirect costs = gross profit
• Amount of contract – indirect costs = gross profit
• Amount of contract – labor – materials = gross profit
• Amount of contract – direct cost – indirect costs – general overhead – income taxes = gross profit

Answer 100

Amount of contract – direct costs – indirect costs = gross profit

Question 101

A contractor’s license may not be suspended or revoked for abandonment of a project if only _____ of the job remains to be finished.

• 3 percent or less
• 5 percent or less
• 7 percent or less
• none

Answer 101

none