NASCLA EXAMINATION PREP STUDY GUIDE
LATEST UPDATED PRACTICE SOLUTION
VERIFIED 100 PERCENT
◉ When a business is purchased by a new owner, what happens in
regards to the "EIN"? Answer: A new EIN is required
Alabama Business Law & Project Management Residential (4th) -
This question is not in the book, but can show up on your exam.
◉ What is the difference between mediation and arbitration? Answer:
With mediation the two disputing parties themselves set the
conditions of any agreement with the help of a mediator. Arbitration
involves a third party that will render the decision by which all parties
are legally bound.
Alabama Business Law & Project Management Residential (4th) - 8-8
◉ How much are performance bonds on federal construction projects
usually for compared to the contract price? Answer: 100%
Alabama Business Law & Project Management Residential (4th) - 4-9
◉ In what year was the Miller Act enacted? Answer: 1935
,Alabama Business Law & Project Management Residential (4th) - 4-9
◉ How are general conditions of a contract typically modified before
the bid? Answer: By using a supplemental conditions document
Alabama Business Law & Project Management Residential (4th) - 8-4
◉ If you receive an invoice for $1000.00 with payment terms of 2/10
net 30. What would be the amount owed if paid within 10 days?
Answer: $980
Alabama Business Law & Project Management Residential (4th) - 14-
13
◉ What are three key functions of a business plan? Answer: Planning
Tool, Loan or Investor Document, Benchmarking tool
Alabama Business Law & Project Management Residential (4th) - 1-2
◉ Which business structure is considered the simplest to setup?
Answer: Sole Proprietorship
Alabama Business Law & Project Management Residential (4th) - 2-1
,◉ What is the major disadvantage of a sole proprietorship? Answer:
Unlimited personal liability
Alabama Business Law & Project Management Residential (4th) - 2-1
◉ With a sole proprietorship, doing business under a different name
other than your own typically requires filing of what document?
Answer: Fictitious name certificate with local or state government
office
Alabama Business Law & Project Management Residential (4th) - 2-1
◉ Which of the following is most important when entering into a
50/50 partnership? Answer: Prepare a written agreement.
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ With a Partnership, are you responsible for the actions of your
partner? Answer: Yes, if they act in the name of the business
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ Which individuals have NO managerial decision-making power
and have liability restricted to the amount of the investment? Answer:
Limited partners
, Alabama Business Law & Project Management Residential (4th) - 2-2
◉ A partnership dissolves leaving a debt of $50,000. How is each
partner liable? Answer: Each partner is liable for the entire amount.
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ A _________ is a legal relationship where two or more persons are
contractually associated as principals in a business? Answer: general
partnership
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ Joe and Harry have formed a partnership. Joe invests 40% of his
personal finances and Harry invests 60% of his finances. The
partnership dissolves after 3 years with debts owed to suppliers of
$50,000. How much is Joe liable for? Answer: $50,000
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ What is one of the ADVANTAGES of a partnership? Answer:
Partnerships share financial resources.
Alabama Business Law & Project Management Residential (4th) - 2-2
LATEST UPDATED PRACTICE SOLUTION
VERIFIED 100 PERCENT
◉ When a business is purchased by a new owner, what happens in
regards to the "EIN"? Answer: A new EIN is required
Alabama Business Law & Project Management Residential (4th) -
This question is not in the book, but can show up on your exam.
◉ What is the difference between mediation and arbitration? Answer:
With mediation the two disputing parties themselves set the
conditions of any agreement with the help of a mediator. Arbitration
involves a third party that will render the decision by which all parties
are legally bound.
Alabama Business Law & Project Management Residential (4th) - 8-8
◉ How much are performance bonds on federal construction projects
usually for compared to the contract price? Answer: 100%
Alabama Business Law & Project Management Residential (4th) - 4-9
◉ In what year was the Miller Act enacted? Answer: 1935
,Alabama Business Law & Project Management Residential (4th) - 4-9
◉ How are general conditions of a contract typically modified before
the bid? Answer: By using a supplemental conditions document
Alabama Business Law & Project Management Residential (4th) - 8-4
◉ If you receive an invoice for $1000.00 with payment terms of 2/10
net 30. What would be the amount owed if paid within 10 days?
Answer: $980
Alabama Business Law & Project Management Residential (4th) - 14-
13
◉ What are three key functions of a business plan? Answer: Planning
Tool, Loan or Investor Document, Benchmarking tool
Alabama Business Law & Project Management Residential (4th) - 1-2
◉ Which business structure is considered the simplest to setup?
Answer: Sole Proprietorship
Alabama Business Law & Project Management Residential (4th) - 2-1
,◉ What is the major disadvantage of a sole proprietorship? Answer:
Unlimited personal liability
Alabama Business Law & Project Management Residential (4th) - 2-1
◉ With a sole proprietorship, doing business under a different name
other than your own typically requires filing of what document?
Answer: Fictitious name certificate with local or state government
office
Alabama Business Law & Project Management Residential (4th) - 2-1
◉ Which of the following is most important when entering into a
50/50 partnership? Answer: Prepare a written agreement.
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ With a Partnership, are you responsible for the actions of your
partner? Answer: Yes, if they act in the name of the business
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ Which individuals have NO managerial decision-making power
and have liability restricted to the amount of the investment? Answer:
Limited partners
, Alabama Business Law & Project Management Residential (4th) - 2-2
◉ A partnership dissolves leaving a debt of $50,000. How is each
partner liable? Answer: Each partner is liable for the entire amount.
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ A _________ is a legal relationship where two or more persons are
contractually associated as principals in a business? Answer: general
partnership
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ Joe and Harry have formed a partnership. Joe invests 40% of his
personal finances and Harry invests 60% of his finances. The
partnership dissolves after 3 years with debts owed to suppliers of
$50,000. How much is Joe liable for? Answer: $50,000
Alabama Business Law & Project Management Residential (4th) - 2-2
◉ What is one of the ADVANTAGES of a partnership? Answer:
Partnerships share financial resources.
Alabama Business Law & Project Management Residential (4th) - 2-2
