Test 2

Question 1

A construction company was hiring a new crew and asked each prospective employee for their name, address, and Social Security number. Several prospective employees remembered their Social Security numbers but did not have a card or other documentation. The practice of relying On memorized Social Security numbers is:

A. acceptable: A memorized Social Security number is sufficient.

B. acceptable: New employees do not have to provide documentation of their Social Security
number.

C. acceptable: Emplovees must show documentation of their Social Security number only if they are resident aliens working in this country.

D. unacceptable: The actual Social Security card should have been inspected.

Answer 1

A. acceptable: A memorized Social Security number is sufficient.

Question 2

Who must pay for a pre-employment physical?

A. employer

B. employee

C. employer and employee

D. workers’ compensation insurer

Answer 2

A. employer

Question 3

In the absence of a collective bargaining agreement, two employees filed a written complaint with DOSH because of unsafe working conditions. The contractor discovered who the employees were and fired them because of the complaint. What would probably happen if the employees appealed the termination?

A. Nothing: A contractor may fire any employee for any reason.
B. Nothing: There is no appeals board for such cases.

C. The contractor must reinstate the employees and reimburse them for lost wages and benefits.

D. The contractor must reinstate the employees but is not required to reimburse them for lost wages and benefits.

Answer 3

C. The contractor must reinstate the employees and reimburse them for lost wages and benefits.

Question 4

A licensed contractor contracts with a building owner to do a $900 improvement. When applying for a building permit, the contractor checks the owner-builder box on the declaration form. Which of the following statements is correct?

A. The contractor may check the box to avoid insurance charges.

B. The contractor should check the box so that the owner-builder verification will be mailed to the owner.

C. The contractor may check the box because the contractor is the owner’s employee.

D. The contractor may not check the owner-builder box because the owner contracted for the improvement.

Answer 4

D. The contractor may not check the owner-builder box because the owner contracted for the improvement.

Question 5

A consumer may cancel a home solicitation contract at any time prior to midnight of the ______________________ after the date of the transaction.

A. 2nd business day

B. 3rd business day

C. 5th business day

D. 7th calendar day

Answer 5

B. 3rd business day

Question 6

Which of the following methods of accounting is not recommended for contractors?

A. accrual

B. percentage of completion

C. completed contract

D. cash

Answer 6

D. cash

Question 7

Where must a contractor include the “Mechanics Lien Warning?”

A. home improvement and service and repair contracts

B. home improvement contracts, including swimming pool contracts

C. home improvement, swimming pool, and service and repair contracts

D. public works contracts

Answer 7

B. home improvement contracts, including swimming pool contracts

Question 8

When a joint control addendum is used, which of the following does not have to be included in a home improvement contract?

A. owner’s signature

B. schedule of payments

C. “Mechanics Lien Warning”

D. license number of the contractor

Answer 8

B. schedule of payments

Question 9

Current liabilities on a balance sheet are debts that become due within:

A. one year.

B. 18 months.

C. two years.

D. it depends on the liability.

Answer 9

A. one year.

Question 10

Within how many days must an employer make personnel records available for inspection by an employee after receiving a written request?

A. immediately

B. no later than 10 calendar days

C. no later than 30 calendar days

D. within 60 working days

Answer 10

C. no later than 30 calendar days

Question 11

A contractor bus a construction firm from a person who is retiring. There is an existing collective bargaining agreement with a successor clause that is good for three years. As the new owner, is the contractor bound by the collective bargaining agreement?

A. No. The contractor never personally consented to the collective bargaining agreement.

B. No. A successor clause in a collective bargaining agreement is not binding on a successor for more than a year.

C. No. Successor clauses in collective bargaining agreements are illegal.

D. Yes. A successor clause in a collective bargaining agreement is binding on a successor for up to three vears.

Answer 11

D. Yes. A successor clause in a collective bargaining agreement is binding on a successor for up to three vears.

Question 12

After the building plans are approved, what is the next step?

A. review the plans and estimate

B. hire employees

C. schedule the job

D. order materials

Answer 12

A. review the plans and estimate

Question 13

Who is responsible for keeping track of change orders?

A. property owner

B. foreperson

C. general contractor

D. supervisor

Answer 13

C. general contractor

Question 14

How often should a job supervisor or responsible managing employee visit the job site?

A. once a day

B. once a week

C. once a month

D. whenever they are near the job site

Answer 14

A. once a day

Question 15

If you find that work done by a previous contractor is in violation of the local building code, what should you do?

A. Repair the violation immediately.

B. Report the violation to the owner with an estimate for the needed repairs.

C. Report the violation directly to the building department.

D. The contractor may ignore the violation.

Answer 15

B. Report the violation to the owner with an estimate for the needed repairs.

Question 16

A contractor finds a 6 inch discrepancy on a set of plans. He or she should:

A. make the correction.

B. contact the owner.

C. ignore the discrepancy because it is minor.

D. contact the architect or the building designer.

Answer 16

D. contact the architect or the building designer.

Question 17

What happens if the sole owner of a construction business dies?

A. Nothing.

B. The business is terminated and the contractor’s license cancelled.

C. The contractor’s license may be transferred to another business.

D. The business is terminated and the contractor’s license suspended.

Answer 17

B. The business is terminated and the contractor’s license cancelled.

Question 18

Who is primarily responsible for safety at the jobsite?

A. contractor and lawyer

B. contractor and building inspector

C. employer and employees

D. Cal/OSHA and job superintendent

Answer 18

C. employer and employees

Question 19

The required Injury and Illness Prevention Program (IPP) takes the form of:

A. a written plan.

B. oral safety talks supplemented by a written plan.

C. an oral or written plan approved by the contractor and an employee representative.

D. a written plan that includes procedures and that is put into practice and documented.

Answer 19

D. a written plan that includes procedures and that is put into practice and documented.

Question 20

Which of the following injuries must be reported to DOSH?

A. Worker suffers a concussion and is unable to return to work for a full day.

B. Worker suffers a burn that requires first aid.

C. All job-related injuries must be reported.

D. Employers are not required to report injuries unless they are serious.

Answer 20

A. Worker suffers a concussion and is unable to return to work for a full day.

Question 21

The purpose of a Preliminary Notice for a home improvement project is to:

A. obtain a building permit.

B. obtain financing for the project.

C. preserve a subcontractor’s or supplier’s right to file a lien if unpaid.

D. stop an unauthorized payment to a subcontractor or supplier.

Answer 21

C. preserve a subcontractor’s or supplier’s right to file a lien if unpaid.

Question 22

How should the prime contractor determine whether a subcontractor has workers’ compensation insurance?

A. Subcontractors do not need workers compensation insurance.

B. The prime contractor should ask to see the expiration date on the sub’s certificate of insurance.

C. The prime contractor should periodically call the sub’s insurance agent to check on the sub’s policies.

D. The prime contractor should check with the Registrar’s office to see if the sub is insured.

Answer 22

B. The prime contractor should ask to see the expiration date on the sub’s certificate of insurance.

Question 23

An employer who receives a citation for a serious violation of Cal/OSHA regulations can be assessed a penalty of up to _________ for each violation.

A. $1,000

B. $5,000

C. $10,000

D. $25,000

Answer 23

D. $25,000

Question 24

Under proper circumstances, the CSLB will arbitrate home improvement contract disputes where the alleged damages are:

A. less than $50,000.

B. over $75,000.

C. less than $100,000.

D. in any amount.

Answer 24

A. less than $50,000.

Question 25

An employer hires one part-time and two full-time employees. The full-time employees are covered by workers’ compensation insurance but not the part-time employee. Is this lawful?

A. Yes: Part-time employees do not have to be covered.

B. Yes: If all of the full-time employees are covered, the part-time employee does not have to be.

C. Yes: If the company has less than 10 employees, part-time employces do not have to be covered.

D. No: Even part-time employees must be covered.

Answer 25

D. No: Even part-time employees must be covered.

Question 26

An income statement shows:

A. assets and liabilities over an extended period of time.

B. revenues and losses at a certain point in time.

C. assets and liabilities at a certain point in time.

D. revenues and expenses over an extended period of time.

Answer 26

D. revenues and expenses over an extended period of time.

Question 27

On a public works project, which of following must be provided to the agency before execution of the contract?

A. copy of the contractor’s license bond

B. copies of employee I-9 forms

C. photo IDs of all employees

D. certificate of workers’ compensation insurance

Answer 27

D. certificate of workers’ compensation insurance

Question 28

In the cash system of accounting, a transaction is recorded or posted:

A. when cash changes hands.

B. when an amount is approved for payment.

C. when an amount is invoiced.

D. when cash is earned and expenses are incurred.

Answer 28

A. when cash changes hands.

Question 29

Employees must provide the contractor with Form W-4:

A. with their job application.

B. when they start work.

C. within 10 days of starting work.

D. no later than January 31 of each year.

Answer 29

B. when they start work.

Question 30

Of the following, which is the best description of “accounts receivable”?

A. Money due from customers who have purchased goods or services on credit.

B. Business costs and expenses due and payable within the current accounting period.

C. Accounts listed on the liability side of the balance sheet.

D. Money owed to material suppliers for credit purchases.

Answer 30

A. Money due from customers who have purchased goods or services on credit.

Question 31

An employer must file federal Form 1099-MISC to report payments of _______ or more per calendar year to persons not treated as employees (e.g., independent contractors) for services performed for the business.

A. $200

B. $300

C. $450

D. $600

Answer 31

D. $600

Question 32

A supplier who is furnishing a contractor with equipment or materials without any form of security other than the reputation of the contractor for paying debts when due has extended what type of credit?

A. unsecured loan

B. open account

C. uninsured load

D. closed account

Answer 32

B. open account

Question 33

Social Security tax for a self-employed contractor is:

A. based on the rate set for the self-employed for the year in which the tax is paid.

B. zero because self-employed contractors are not required to pay social security tax.

C. the same as the employees’ rate.

D. half the employees’ rate.

Answer 33

A. based on the rate set for the self-employed for the year in which the tax is paid.

Question 34

How often are FUTA tax deposits made by most employers?

A. weekly

B. monthly

C. quarterly

D. yearly

Answer 34

C. quarterly

Question 35

To whom does an emplover pay FUTA tax?

A. Employment Development Department

B. Internal Revenue Service

C. U.S. Department of Labor

D. State Franchise Tax Board

Answer 35

B. Internal Revenue Service

Question 36

An employee whose regular rate is $20/hour works 60 hours one week and 30 hours the next. Based on a two-week payroll system, what are the gross wages due, allowing for time-and-a-half overtime pay after 40 hours in a week?

A. $1,000

B. $1,800

C. $2,000

D. $2,300

Answer 36

C. $2,000

Question 37

What is the best way to determine if your company is profitable?

A. Ask the crew supervisors.

B. Compare the size of inventory with last year’s.

C. Examine the income statement.

D. Examine the balance sheet.

Answer 37

C. Examine the income statement.

Question 38

Which of the following is considered a fixed expense?

A. office rent

B. wages

C. office supplies

D. materials

Answer 38

A. office rent

Question 39

Which financial ratio measures liquidity?

A. current ratio

B. acid-test ratio (quick ratio)

C. both of the above

D. neither of the above

Answer 39

C. both of the above

Question 40

Which of the following is a correct statement about budgets?

A. Budgets do not require accurate books.

B. Budgets do not require detailed cost information.

C. The goal of a budget is to forecast expenses as accurately as possible.

D. A budget should allow leeway for month-to-month variations.

Answer 40

D. A budget should allow leeway for month-to-month variations.

Question 41

If you are required to report employment taxes or give tax statements, the ________________ must obtain a federal Employer Identification Number.

A. employee and employer

B. employee

C. employer

D. bookkeeper

Answer 41

C. employer

Question 42

Suppose you include depreciation on your income statement your first year in business, but you do not include it in the second year. How will this affect your net income being reported?

A. It is illegal to omit depreciation.

B. Your net income will be the same for both years.

C. Your net income will be less than it should be in the second year.

D. Your net income will be greater than it should be in the second year.

Answer 42

D. Your net income will be greater than it should be in the second year.

Question 43

What federal forms are given to a newly hired employee?

A. W-4 and I-9

B. W-4 and DE-1

C. I-9 and W-3

D. 1099-R and FTD-8109

Answer 43

A. W-4 and I-9

Question 44

How do you know if you are bidding correctly?

A. You are getting all the jobs you bid on.

B. The job cost is almost the same as the estimated cost.

C. The job cost is substantially below the estimated cost.

D. The job cost is substantially above the estimated cost.

Answer 44

B. The job cost is almost the same as the estimated cost.

Question 45

You are bidding on a job with plans drawn by a homeowner. You notice that the dimensions on the plans do not add up. What should you do?

A. Inform the homeowner that you cannot bid until the numbers add up.

B. Tell the homeowner to consult an architect.

C. Bid the job as is. You can add change orders later.

D. Make the corrections yourself and bid the job.

Answer 45

A. Inform the homeowner that you cannot bid until the numbers add up.

Question 46

A contractor is bidding on a project for a homeowner. The homeowner has included several “extra” items to be bid upon. Àfter receiving the bid, the homeowner said it was too high and asked the contractor to lower the price. What should the contractor do?

A. Decline the work.

B. Negotiate with the homeowner to reduce the scope of the work by eliminating some of the extra items.

C. Lower your bid to cost and hope to recover the overhead later.

D. Lower your bid to cost and overhead only (eliminate the profit).

Answer 46

B. Negotiate with the homeowner to reduce the scope of the work by eliminating some of the extra items.

Question 47

A schedule of payments in a home improvement contract must include which of the following details?

A. amount of each payment as a sum in dollars and cents

B. specific reference to the amount of work and services to be performed

C. specific reference to the materials and equipment to be supplied

D. all of the above

Answer 47

D. all of the above

Question 48

A prime contractor decides to sub out the electrical work. How would the prime determine what price to add for the electrical work?

A. The prime calls up the electrical material supplier and calculates the bid amount.

B. The prime gets an estimate from the subcontractor.

C. Everybody charges a flat rate.

D. The prime gets a firm bid from the subcontractor.

Answer 48

D. The prime gets a firm bid from the subcontractor.

Question 49

What is the best way to ensure that your license bond remains in effect after its expiration date (i.e., what is the best way to avoid a period of suspension)?

A. Renew the bond seven days after expiration.

B. Make sure the effective date of the new bond is the same as the cancellation date of the old bond

C. Make sure the effective date of the new bond is the day after the cancellation date of the old bond

D. Buy a second bond that overlaps coverage.

Answer 49

B. Make sure the effective date of the new bond is the same as the cancellation date of the old bond

Question 50

Direct costs are $7,200, overhead is 12%, and profit is 10%. What is the selling price?

A. $7,389.50

B. $8,326.28

C. $9,132.37

D. $9,230.77

Answer 50

D. $9,230.77

Question 51

A home improvement salesperson’s (HIS) registration must be renewed every:

A. four years.

B. two years.

C. year.

D. job.

Answer 51

B. two years.

Question 52

Bob Smith is the RME and works full-time for XYZ Construction Co. Bob holds an individual license with a different name and license number and wants to bid and build wood decks on weekends. Is this legal?

A. Yes: Bob may qualify an unlimited number of active contractor’s licenses.

B. Yes: Bob may work under his individual license if he works at least 32 hours a week for XYZ.

C. No: Bob must take another qualifying exam to qualify a second license.

D. No: Bob may qualify only XYZ’s license in this case.

Answer 52

D. No: Bob may qualify only XYZ’s license in this case.

Question 53

An individual who meets certain conditions may serve as the qualifier for up to _________ firms in any one-year period.

A. one

B. two

C. three

D. four

Answer 53

C. three

Question 54

Using money from a current job to pay for unrelated projects is called:

A. diversion.

B. usury.

C. penury.

D. transmigration.

Answer 54

A. diversion.

Question 55

As a subcontractor on a public work of improvement, you complete your contract in a workmanlike manner. The prime contractor, Mr. Adams, informs you that he cannot pay you. One of your best options is to file a stop payment notice, which has what effect?

A. It starts foreclosure proceedings.

B. It instructs Mr. Adams to “stop” work until you are paid, or else face felony charges.

C. It creates a lien on the construction funds.

D. It creates a lien on the property you improved.

Answer 55

C. It creates a lien on the construction funds.

Question 56

Besides workers’ compensation, what type of insurance is required for a public works project?

A. term life

B. builders risk

C. health

D. liability

Answer 56

D. liability

Question 57

How long does a client have to submit a claim for service or repair of a defect on fit and finish items after a remodel?

A. 30 days

B. 1 month

C. 1 year

D. 10 years

Answer 57

C. 1 year

Question 58

A Small Claims Court may dismiss a lawsuit filed by a contractor if:

A. the home improvement contract price is less than $50.00.

B. the contractor did not file a mechanics lien.

C. the contractor was not licensed during performance of a contract for $500 or more.

D. the owner did not post a notice of non-responsibility.

Answer 58

C. the contractor was not licensed during performance of a contract for $500 or more.

Question 59

59. Of the following, which is usually the most difficult item to estimate?

A. labor

B. materials

C. overhead

D. profit

Answer 59

A. labor

Question 60

Except in an emergency, you must notify the regional Underground Service Alert Center within how many days before beginning to excavate?

A. at least one calendar day

B. at least one working day

C. at least two working days but not more than 14 calendar days

D. at least five working days but no more than 28 calendar days

Answer 60

C. at least two working days but not more than 14 calendar days

Question 61

Excavators must clearly mark the boundaries of a work area, usually with _________ paint.

A. red

B. yellow

C. brown

D. white

Answer 61

D. white

Question 62

What happens to a partnership license if a general partner leaves the business or dies?

A. Nothing.

B. The partnership will have to merge with another business.

C. The partnership license will be converted to an individual license.

D. The partnership license will be cancelled.

Answer 62

D. The partnership license will be cancelled.

Question 63

Which of the following information may an employer reveal about an employee?

A. employee’s Social Security Number

B. employee’s name

C. employee’s home address

D. employee’s driver’s license number

Answer 63

B. employee’s name

Question 64

How long should a contractor keep employee payroll records?

A. 3 years

B. 2 years

C. 1 year

D. for as long as a worker is employed

Answer 64

A. 3 years

Question 65

If a contractor has temporary cash-fow problems, what is a good way to get through the crisis?

A. Hold off paying the materials bill

B. Delay paying the employees.

C. Apply for a construction loan.

D. Use funds from a pre-established line of credit.

Answer 65

D. Use funds from a pre-established line of credit.

Question 66

___________, although usually the largest single item in a bid, can be fairly accurately determined.

A. Permits

B. Overhead

C. Labor

D. Materials

Answer 66

D. Materials

Question 67

Disabled access laws went into effect in ______ for public buildings and in _______ for private buildings.

A. 1960 … 1961

B. 1968 … 1970

C. 1970 … 1971

D. 1975 … 1976

Answer 67

B. 1968 … 1970

Question 68

You are at a critical point in a project and the owner tells you that something already completed was not done correctly. What should you do?

A. Tell the owner you will attend to the matter after you complete the critical work you are doing.

B. Stop work on the critical job and remedy the error.

C. Hire more workers to remedy the error.

D. Ask the owner to sign a change order.

Answer 68

A. Tell the owner you will attend to the matter after you complete the critical work you are doing.

Question 69

Of the following; which is the best way to monitor and analyze labor costs?

A. Use detailed time cards with a task breakdown for each worker.

B. Compare previous labor costs.

C. Ask crew supervisors.

D. Check the profit-and-loss statement.

Answer 69

A. Use detailed time cards with a task breakdown for each worker.

Question 70

Unsafe or faulty equipment is found on a job site. What should be done?

A. The contractor should call Cal/OSHA.

B. It is the contractor’s responsibility to correct the problem.

C. It is the property owner’s responsibility to correct the problem.

D. It is the employees’ responsibility to correct the problem.

Answer 70

B. It is the contractor’s responsibility to correct the problem.

Question 71

In most construction contracts, the retention may be held for up to _______ days as a guarantee that the prime pays the subcontractors and suppliers.

A. 10

B. 30

C. 60

D. 90

Answer 71

C. 60

Question 72

How often should the safety supervisor be at the job site?

A. once a week

B. only when dangerous equipment is used or about to be used

C. once a day

D. it depends on the work being done

Answer 72

D. it depends on the work being done

Question 73

A contractor has been turned in to DOSH by an employee for a safety violation. The contractor wants to find out who reported the violation and asked DOSH for the employee’s name. What will DOSH likely do?

A. Through due-process procedures, DOSII will identify the employee, but no retaliation may
be directed at the employee.

B. Through due-process procedures, DOSHI will identify the employce, but the employee may
not be fired.

C. DOSH will release the employee’s name for a fee, and the contractor may deal with the employee in any way the contractor chooses.

D. Unless requested otherwise, DOSHI will keep confidential the name of any person making a complaint, and no retaliation may be directed at the employee if the employee’s identity is
discovered.

Answer 73

D. Unless requested otherwise, DOSHI will keep confidential the name of any person making a complaint, and no retaliation may be directed at the employee if the employee’s identity is
discovered.

Question 74

How long are contractors required to keep records after completing a construction project?

A. 2 years

B. 5 years

C. 7 years

D. 10 years

Answer 74

B. 5 years

Question 75

If a contractor violates a safety code and an employce is injured, who will be held responsible?

A. architect

B. employee

C. contractor

D. owner

Answer 75

C. contractor

Question 76

Which of the following is considered the most accurate way to bid a job?

A. calculate by square footage and use a unit-price manual

B. get estimates from material suppliers

C. make a detailed survey of equipment and materials needed for the job

D. use the architect’s cost estimate

Answer 76

C. make a detailed survey of equipment and materials needed for the job

Question 77

If a building permit is required, when does the law permit a building inspector to enter and inspect a residence?

A. between 8 am and 6 pm unless the owner has given permission to inspect at some other time

B. within 24 hours after the building department is notified that construction has been completed

C. 10 days after completion of all work

D. anytime, day or night

Answer 77

A. between 8 am and 6 pm unless the owner has given permission to inspect at some other time

Question 78

Star Construction moved to a new office but never filed a change-of-address form with the Registrar. As a result, Star never received a license renewal application. If Star fails to renew its license within five years of the date of expiration, it will have to:

A. apply for a new license.

B. simply file a contractor’s license bond.

A. pay a delinquency fee to renew the license.

D. complete and file a delinquent license renewal form.

Answer 78

A. apply for a new license.

Question 79

A balance sheet shows:

A. revenues and expenses over an extended period of time.

B. assets and liabilities over an extended period of time.

C. assets and liabilities at a certain point in time.

D. revenues and expenses at a certain point in time.

Answer 79

C. assets and liabilities at a certain point in time.

Question 80

Whom do you contact to obtain a permit for building in a coastal area?

A. Coastal Commission and CSLB

B. Coastal Commission and Building Department

C. CSLB

D. a permit is not required in a coastal area

Answer 80

B. Coastal Commission and Building Department

Question 81

Before beginning work on a project, the contractor must inquire of the owner whether asbestos is present in any building or structure built before:

A. 1968.

B. 1978.

C. 1982.

D. 1985.

Answer 81

B. 1978.

Question 82

When preparing a bid, you should:

A. allow for unexpected problems or costs.

B. put as little in writing as possible.

C. schedule the job to slightly overload your capacity.

D. not include overhead costs.

Answer 82

A. allow for unexpected problems or costs

Question 83

An active contractor’s license that was issued on January 18, 2016, will expire on:

A. January 18, 2018.

B. January 31, 2018.

C. January 18, 2020.

D. January 31, 2020.

Answer 83

B. January 31, 2018.

Question 84

A notice canceling a home solicitation contract becomes effective:

A. when the written notice is deposited in the mail.

B. when signed by the owner.

C. the day the owner cancels by telephone.

D. within 72 hours from the postmark on the cancellation letter.

Answer 84

A. when the written notice is deposited in the mail.

Question 85

If an owner cancels a home solicitation contract on March 20, by what date must the contractor return the down payment?

A. March 23

B. March 30

C. April 1

D. April 20

Answer 85

B. March 30

Question 86

Which of the following is an employer required to do to discourage sexual harassment in the workplace?

A. Hire only men or women.

B. Hold weekly meetings to discuss harassment.

C. Ask job applicants to disclose previous complaints of sexual harassment.

D. Use approved brochures, posters, and other publications to inform employees about the illegality and consequences of sexual harassment.

Answer 86

D. Use approved brochures, posters, and other publications to inform employees about the illegality and consequences of sexual harassment.

Question 87

A subcontractor must file a mechanics lien with the:

A. County Clerk.

B. County Recorder.

C. owner.

D. lender.

Answer 87

B. County Recorder.

Question 88

How many days does a subcontractor have to file a lien after a Notice of Cessation is recorded?

A. 10 days

B. 30 days

C. 60 days

D. 90 days

Answer 88

B. 30 days

Question 89

If no Notice of Completion or Cessation is given on a job, how many days does a contractor have to file a mechanics lien after completion of work?

A. 30 days

B. 60 days

C. 90 days

D. 180 days

Answer 89

C. 90 days

Question 90

If a subcontractor were to serve the owner with a stop payment notice, the most likely reason would be to:

A. inform the owner that the subcontractor has not been paid by the prime, and the owner must set aside sufficient funds to pay the subcontractor’s bill

B. inform the owner that the owner’s property will be attached if payment is not made.

C. notify the owner that a lien will be filed against the property if the subcontractor is not paid.

D. notify the owner that the subcontractor has completed his or her portion of the work.

Answer 90

A. inform the owner that the subcontractor has not been paid by the prime, and the owner must set aside sufficient funds to pay the subcontractor’s bill

Question 91

If you are a subcontractor, there are three general steps in the mechanics lien procedure to make sure you are paid for works of improvement upon property.
Step 1: Determine the exact legal description of the property (map book, page, etc.).
Step 2:
Step 3: Complete the work and record a Claim of Lien if you are not paid on time.
What is Step 2?

A. Request prepayment for your work.

B. Serve a preliminary 20-day notice.

C. Run credit checks on the owner and prime contractor.

D. List the attorney representing the subcontractor.

Answer 91

D. List the attorney representing the subcontractor.

Question 92

A contract bond:

A. is required to obtain a corporate contractor’s license.

B. guarantees payment of labor and materials only.

C. guarantees job completion only.

D. guarantees job completion and payment of all labor and materials.

Answer 92

D. guarantees job completion and payment of all labor and materials

Question 93

If an employee works 40 hrs/week for four weeks and insurance costs $147.20/month, how much is the insurance cost per hour for the employee?

A. $0.46

B. $0.76

C. $0.92

D. $1.32

Answer 93

C. $0.92

Question 94

If a client has a dispute with a contractor for $25,000 in damages, where is the dispute likely to be heard?

A. Small Claims Court

B. Federal Court

C. CSLB voluntary arbitration program

D. CSLB mandatory arbitration program

Answer 94

C. CSLB voluntary arbitration program

Question 95

A contractor submits the lowest bid for a home improvement project. Which of the following bonds will protect the owner if the contractor decides not to take the job?

A. bid bond

B. performance bond

C. contract bond

D. completion bond

Answer 95

A. bid bond

Question 96

Who determines the prevailing wage rate on public works projects?

A. prime contractor negotiates rate with workers

B. CSLB

C. EDD

D. DIR

Answer 96

D. DIR

Question 97

Which of the following payroll taxes does not have a limit?

A. FICA

B. FUTA

C. FIT

D. SDI

Answer 97

C. FIT

Question 98

Which of the following requires an EIN?

A. licensed contractor with no employees

B. any business located in California

C. a sole proprietorship with employees

D. the owner of a retail store with no employees

Answer 98

C. a sole proprietorship with employees

Question 99

How long must a contractor retain records for employees exposed to hazardous materials?

A. 15 years

B. 30 years

C. 40 years

D. as long as an employee works for the contractor

Answer 99

B. 30 years

Question 100

Which of the following is classified as a job-related direct cost?

A. performance bond

B. contractor’s license renewal fee

C. trade association membership fee

D. office rent

Answer 100

A. performance bond