NASCLA BUSINESS LAW AND MANAGEMENT
EXAM SC EXAM QUESTIONS AND CORRECT
ANSWERS (VERIFIED ANSWERS) PLUS
RATIONALES 2026 Q&A | INSTANT DOWNLOAD
PDF
Sole Proprietorship - CORRECT ANSWER -a business owned and
managed by a single individual
Simplest form to set up
unlimited Liability
Partnerships - CORRECT ANSWER -Business organizations in which two
or more persons share responsibilities, costs, profits, and losses.
C Corporations - CORRECT ANSWER -Corporations that have no
restrictions on who owns their shares or the number of shareholders; they
cannot qualify for subchapter S tax treatment and are subject to direct
taxation
S corporation - CORRECT ANSWER -A unique government creation that
looks like a corporation but is taxed like sole proprietorships and
partnerships
No more than 100 shareholders
FILING IRS FORM 2553
,Limited liability company - CORRECT ANSWER -A business organization
in which the business (not the owner) is liable for the company's debts
joint venture - CORRECT ANSWER -an agreement between two or more
companies to share a business project
Reserving business Name - CORRECT ANSWER -Register with secretary
of state
Purpose of licensing - CORRECT ANSWER -Protect Health, Safety, and
welfare of the public
When is a Contractors license Needed? - CORRECT ANSWER -Excess of
$5000
cease and desist order - CORRECT ANSWER -ruling requiring a company
to stop an unfair business practice from performing work without a license
Monetary limitations for general and mechanical contractors - CORRECT
ANSWER -determined by the financial net worth of the entity seeking
licensure
Group Limitations - CORRECT ANSWER -Divided into groups according to
net worth.
Reciprocity - CORRECT ANSWER -South Carolina has a reciprocal
agreement with certain states but licensee must still pass the business and
law exam.
, Property insurance - CORRECT ANSWER -A type of insurance that covers
damage to property, such as a home.
liability insurance - CORRECT ANSWER -insurance that provides
protection from claims arising from injuries or damage to other people or
property
Business Owners Policy (BOP) - CORRECT ANSWER -Property and
liability Coverage are bundles under business owners policies
Automobile Insurance - CORRECT ANSWER -Provides payments for both
liability and physical damage to vehicles
Burglary and Theft Insurance - CORRECT ANSWER -Loss or damage by
burglary, theft, Larceny, Robbery, Forgery, Fraud, and vandalism.
Key Man Life Insurance - CORRECT ANSWER -This type of insurance is
available as life insurance or disability insurance to protect continuing
sucess of your business.
Coverage Gaps and Overlaps - CORRECT ANSWER -It is important to
evaluate all your insurance coverage. Using one insurer may minimize
gaps and overlaps in coverage.
Bid Documents include - CORRECT ANSWER -An invitation to Bid
Bid instructions
EXAM SC EXAM QUESTIONS AND CORRECT
ANSWERS (VERIFIED ANSWERS) PLUS
RATIONALES 2026 Q&A | INSTANT DOWNLOAD
Sole Proprietorship - CORRECT ANSWER -a business owned and
managed by a single individual
Simplest form to set up
unlimited Liability
Partnerships - CORRECT ANSWER -Business organizations in which two
or more persons share responsibilities, costs, profits, and losses.
C Corporations - CORRECT ANSWER -Corporations that have no
restrictions on who owns their shares or the number of shareholders; they
cannot qualify for subchapter S tax treatment and are subject to direct
taxation
S corporation - CORRECT ANSWER -A unique government creation that
looks like a corporation but is taxed like sole proprietorships and
partnerships
No more than 100 shareholders
FILING IRS FORM 2553
,Limited liability company - CORRECT ANSWER -A business organization
in which the business (not the owner) is liable for the company's debts
joint venture - CORRECT ANSWER -an agreement between two or more
companies to share a business project
Reserving business Name - CORRECT ANSWER -Register with secretary
of state
Purpose of licensing - CORRECT ANSWER -Protect Health, Safety, and
welfare of the public
When is a Contractors license Needed? - CORRECT ANSWER -Excess of
$5000
cease and desist order - CORRECT ANSWER -ruling requiring a company
to stop an unfair business practice from performing work without a license
Monetary limitations for general and mechanical contractors - CORRECT
ANSWER -determined by the financial net worth of the entity seeking
licensure
Group Limitations - CORRECT ANSWER -Divided into groups according to
net worth.
Reciprocity - CORRECT ANSWER -South Carolina has a reciprocal
agreement with certain states but licensee must still pass the business and
law exam.
, Property insurance - CORRECT ANSWER -A type of insurance that covers
damage to property, such as a home.
liability insurance - CORRECT ANSWER -insurance that provides
protection from claims arising from injuries or damage to other people or
property
Business Owners Policy (BOP) - CORRECT ANSWER -Property and
liability Coverage are bundles under business owners policies
Automobile Insurance - CORRECT ANSWER -Provides payments for both
liability and physical damage to vehicles
Burglary and Theft Insurance - CORRECT ANSWER -Loss or damage by
burglary, theft, Larceny, Robbery, Forgery, Fraud, and vandalism.
Key Man Life Insurance - CORRECT ANSWER -This type of insurance is
available as life insurance or disability insurance to protect continuing
sucess of your business.
Coverage Gaps and Overlaps - CORRECT ANSWER -It is important to
evaluate all your insurance coverage. Using one insurer may minimize
gaps and overlaps in coverage.
Bid Documents include - CORRECT ANSWER -An invitation to Bid
Bid instructions
