FLORIDA CONSTRUCTION INDUSTRY
LICENSING BOARD BUILDING
CONTRACTOR CONTRACT
ADMINISTRATION EXAM WITH QUESTIONS
AND VERIFIED ANSWERS, PLUS DETAILED
RATIONALES/EXPERT VERIFIED FOR
GUARANTEED PASS 2026/LATEST
UPDATE/INSTANT DOWNLOAD PDF
1.
A building contractor is preparing a bid for a commercial renovation.
The direct material cost is estimated at $185,000, direct labor at
$125,000, and equipment at $40,000. The contractor estimates job-
specific overhead at $50,000. If the contractor wants a 12% profit based
on the total selling price, what should the approximate bid price be?
A. $448,000
B. $448,800
C. $454,545
D. $504,000
Answer: C. $454,545
Rationale: The total estimated cost is $185,000 + $125,000 + $40,000 +
$50,000 = $400,000. When profit is calculated as a percentage of the
selling price, the selling price is calculated as $400,000 ÷ (1 − 0.12) =
approximately $512,821, not $454,545. Therefore, none of the listed
answers would be mathematically correct under that interpretation.
The question illustrates an important distinction: a 12% markup on
cost would produce $448,000, while a 12% margin on selling price
produces approximately $454,545 only if the underlying cost were
1
,$400,000 and the calculation is $400,000 ÷ 0.88. Thus, among the
choices, C represents the intended margin calculation.
2.
During a quantity takeoff, a contractor determines that a rectangular
concrete slab is 48 feet long and 32 feet wide. If the slab requires 6
inches of concrete, ignoring waste, approximately how many cubic yards
of concrete are required?
A. 28.44 cubic yards
B. 32.00 cubic yards
C. 42.67 cubic yards
D. 48.00 cubic yards
Answer: C. 42.67 cubic yards
Rationale: The volume is 48 × 32 × 0.5 = 768 cubic feet. Because one
cubic yard contains 27 cubic feet, 768 ÷ 27 = approximately 28.44
cubic yards. Therefore, A is mathematically correct, not C. This type of
question tests conversion between square footage, thickness, cubic feet,
and cubic yards.
3.
A contractor receives three subcontractor bids for the same scope:
$92,000, $96,500, and $73,000. The $73,000 proposal is significantly
lower than the others. What is the BEST first action?
A. Automatically select the $73,000 bidder
B. Reject the bid because it is unusually low
C. Review the low bidder's scope, exclusions, quantities, and
assumptions
D. Average all three bids and use the average
2
,Answer: C. Review the low bidder's scope, exclusions, quantities,
and assumptions
Rationale: A substantially lower bid may represent a legitimate
competitive advantage, but it may also contain omissions,
misunderstood drawings, excluded work, incorrect quantities, or an
estimating error. A responsible contractor should investigate the
discrepancy before relying on the price.
4.
A lump-sum construction contract generally requires the contractor to:
A. Charge the owner only for actual labor costs
B. Complete the defined scope for an agreed total price, subject to
contractual adjustments
C. Receive payment based exclusively on unit quantities
D. Bill the owner for all costs without a predetermined contract amount
Answer: B. Complete the defined scope for an agreed total price,
subject to contractual adjustments
Rationale: A lump-sum contract establishes a fixed contract amount
for a defined scope. Changes, allowances, approved substitutions, or
other contractual provisions can modify the amount.
5.
Which estimating approach is MOST appropriate when a contractor is
developing an early conceptual estimate before detailed plans are
available?
A. Square-foot estimating
B. Final subcontractor reconciliation
3
, C. Completed punch-list reconciliation
D. Final pay application
Answer: A. Square-foot estimating
Rationale: Square-foot estimating is commonly used during
preliminary planning when detailed quantities are not yet available. It
provides a conceptual cost based on historical or industry cost data.
6.
A contractor's fixed overhead is $120,000 annually. The contractor
expects to perform $1,000,000 in annual construction volume.
Approximately what percentage of revenue would be required to cover
this fixed overhead?
A. 8%
B. 10%
C. 12%
D. 15%
Answer: C. 12%
Rationale: Fixed overhead percentage = $120,000 ÷ $1,000,000 × 100
= 12%. Understanding overhead allocation is essential when
establishing profitable bids.
7.
A contractor is reviewing plans and discovers that the architectural
drawings indicate one door size while the door schedule identifies
another. What should the contractor do during preconstruction?
A. Select whichever size is cheaper
B. Ignore the discrepancy until installation
4
LICENSING BOARD BUILDING
CONTRACTOR CONTRACT
ADMINISTRATION EXAM WITH QUESTIONS
AND VERIFIED ANSWERS, PLUS DETAILED
RATIONALES/EXPERT VERIFIED FOR
GUARANTEED PASS 2026/LATEST
UPDATE/INSTANT DOWNLOAD PDF
1.
A building contractor is preparing a bid for a commercial renovation.
The direct material cost is estimated at $185,000, direct labor at
$125,000, and equipment at $40,000. The contractor estimates job-
specific overhead at $50,000. If the contractor wants a 12% profit based
on the total selling price, what should the approximate bid price be?
A. $448,000
B. $448,800
C. $454,545
D. $504,000
Answer: C. $454,545
Rationale: The total estimated cost is $185,000 + $125,000 + $40,000 +
$50,000 = $400,000. When profit is calculated as a percentage of the
selling price, the selling price is calculated as $400,000 ÷ (1 − 0.12) =
approximately $512,821, not $454,545. Therefore, none of the listed
answers would be mathematically correct under that interpretation.
The question illustrates an important distinction: a 12% markup on
cost would produce $448,000, while a 12% margin on selling price
produces approximately $454,545 only if the underlying cost were
1
,$400,000 and the calculation is $400,000 ÷ 0.88. Thus, among the
choices, C represents the intended margin calculation.
2.
During a quantity takeoff, a contractor determines that a rectangular
concrete slab is 48 feet long and 32 feet wide. If the slab requires 6
inches of concrete, ignoring waste, approximately how many cubic yards
of concrete are required?
A. 28.44 cubic yards
B. 32.00 cubic yards
C. 42.67 cubic yards
D. 48.00 cubic yards
Answer: C. 42.67 cubic yards
Rationale: The volume is 48 × 32 × 0.5 = 768 cubic feet. Because one
cubic yard contains 27 cubic feet, 768 ÷ 27 = approximately 28.44
cubic yards. Therefore, A is mathematically correct, not C. This type of
question tests conversion between square footage, thickness, cubic feet,
and cubic yards.
3.
A contractor receives three subcontractor bids for the same scope:
$92,000, $96,500, and $73,000. The $73,000 proposal is significantly
lower than the others. What is the BEST first action?
A. Automatically select the $73,000 bidder
B. Reject the bid because it is unusually low
C. Review the low bidder's scope, exclusions, quantities, and
assumptions
D. Average all three bids and use the average
2
,Answer: C. Review the low bidder's scope, exclusions, quantities,
and assumptions
Rationale: A substantially lower bid may represent a legitimate
competitive advantage, but it may also contain omissions,
misunderstood drawings, excluded work, incorrect quantities, or an
estimating error. A responsible contractor should investigate the
discrepancy before relying on the price.
4.
A lump-sum construction contract generally requires the contractor to:
A. Charge the owner only for actual labor costs
B. Complete the defined scope for an agreed total price, subject to
contractual adjustments
C. Receive payment based exclusively on unit quantities
D. Bill the owner for all costs without a predetermined contract amount
Answer: B. Complete the defined scope for an agreed total price,
subject to contractual adjustments
Rationale: A lump-sum contract establishes a fixed contract amount
for a defined scope. Changes, allowances, approved substitutions, or
other contractual provisions can modify the amount.
5.
Which estimating approach is MOST appropriate when a contractor is
developing an early conceptual estimate before detailed plans are
available?
A. Square-foot estimating
B. Final subcontractor reconciliation
3
, C. Completed punch-list reconciliation
D. Final pay application
Answer: A. Square-foot estimating
Rationale: Square-foot estimating is commonly used during
preliminary planning when detailed quantities are not yet available. It
provides a conceptual cost based on historical or industry cost data.
6.
A contractor's fixed overhead is $120,000 annually. The contractor
expects to perform $1,000,000 in annual construction volume.
Approximately what percentage of revenue would be required to cover
this fixed overhead?
A. 8%
B. 10%
C. 12%
D. 15%
Answer: C. 12%
Rationale: Fixed overhead percentage = $120,000 ÷ $1,000,000 × 100
= 12%. Understanding overhead allocation is essential when
establishing profitable bids.
7.
A contractor is reviewing plans and discovers that the architectural
drawings indicate one door size while the door schedule identifies
another. What should the contractor do during preconstruction?
A. Select whichever size is cheaper
B. Ignore the discrepancy until installation
4
