CSLB CONTRACTOR'S EXAM PRACTICE QUESTIONS AND ANSWERS LATEST UPDATE

CSLB CONTRACTOR'S EXAM PRACTICE QUESTIONS AND ANSWERS LATEST UPDATE . Which act establishes the rights of workers to organize into unions and negotiate contracts? - Answer National Labor Relations Act of 1935 A contractor has had a problem with employees stealing tools and equipment from job sites. When conducting job interviews, may the contractor ask prospective employees about their arrest records? A. It is legal to ask prospective employees about arrests not leading to convictions. B. It is not legal to ask prospective employees about arrests not leading to convictions. C. It is legal for a private employer to ask about arrests not leading to convictions, but it would not be legal for city or county agencies to ask about such arrests. D. It is legal for a private employer to ask about arrests leading to convictions, but it would not be legal for a federal, state, or local public agency to do so. - Answer It is not legal to ask prospective employees about arrest not leading to convictions. Why would a contractor have a case in Superior Court? - Answer If it is a dispute of more than $25,000 it can be transferred to Superior Court. Which would not have to be reported to DOSH immediately or within 24 hours? A. Death from a three-story fall. B. Drunken crane operator hits a high-voltage power line C. Car accident in which an employee steps onto a public road, gets hit by a car, and suffers a concussion. D. Employee falls off forklift and suffers a sever back injury. - Answer Car accident in which an employee steps onto a public road, gets hit by a car, and suffers a concussion. A general contractor has obtained bids from several subcontractors for a private project. He notices that one bid is substantially lower than the rest. Is it ethical and a good business practice for this contractor to inform the subcontractor that the bid is substantially lower than the bids of the other subcontractors? - Answer Yes. If the contractor has reason to believe that the subcontractor has made an error in preparing his bid, the contractor should notify the subcontractor of the apparent error, but the contractor may not disclose the amounts of the other bids. An employer must furnish an employee with a completed IRS Form W-2 (Wage and Tax Statement) by: - Answer The 31st of January. After a job is completed, the owner decides to have additional work done. How should the contractor proceed? - Answer Write a new contract and ask the owner to sign it. The purpose of a 20-day preliminary notice for private work is to? - Answer Notify the owner that the person or firm who sent the notice has improved the property. Is it legal for a contractor to pay employees in cash? - Answer Yes, if the contractor provides each employee with a wage deduction statement semimonthly or at the time of each wage payment. You are bidding on a job with plans drawn by the owner. You notice a code violation and bring it to the attention of the owner. The owner declines to remedy the code violation and tells you not to worry. What should you do? - Answer Decline to bid the work. On a time-and-materials job, you should: - Answer Add profit and overhead to labor and materials Your employee sets a cabinet wrong. The cabinet falls from the wall and damages the client's counter top. What should you do? A. Claim the damage on your general liability insurance policy. B. Require the employee to pay for the damage to the countertop. C. Tell the client to claim the damaged counter top on his or her homeowner's insurance policy. D. No action is required: The client must assume the risk of damage. - Answer Claim the damage on your general liability insurance policy. Of the following, which is best for determining the number of hours required for different phases of a project and for making sure the job is on schedule? A. Bar graph and chart B. Cash analysis chart C. Review plans D. Critical path method - Answer The critical path method. Is it legal for a contractor to require employees to take a lie detector test? - Answer It is not legal for the contractor to require lie detector tests, but it would be legal for a federal, state, or local public agency to require lie detector tests of their employees. If a newly hired employee does not have a SSN, what should be done? - Answer The employee must apply for a SSN. How many times may you take the contractors license exam before your original application is voided? - Answer As many times as necessary within 18 months. When should a contractor renew the contractor's license bond? - Answer 30 days before it expires. The qualifying RME for a construction firm must work at least: - Answer A qualifying RME for a construction firm must work at least 32 hours per week or 80% of the work week. The federal Employer Identification Number (EIN) is issued by the: - Answer The Internal Revenue Service Every employer of ______ or more full or part time employees must keep written health and safety records for _______ years. A. 1-3 B. 7-4 C. 10-3 D. 11-5 - Answer Every employer of 11 or more full or part time employees must keep written health and safety records for 5 years. After you have read the plans and specifications, what is the next important step in writing a bid? A. Talk to and select subs. B. Walk the job. C. Call about materials, price, and availability. D. Talk to the crew leader about labor. - Answer Walk the job. Once a budget is finalized, the: A. Contractor should stick to the budget no matter what happens. B. Contractor should do the best possible job of staying within the budget. C. Budget should be revised each month. D. Budget should be referred to only if the business has cashflow problems. - Answer The contractor should do the best possible job of staying within budget. ` Who must sign a joint control addendum to a home improvement contract? - Answer Owner, contractor, and joint control officer. When purchasing insurance, what is the best way to chose among different companies? - Answer Cost and Coverage Sometimes contracts can prove to be too vague to interpret without disagreement between owner and contractor. Which of the following steps would best prevent such problems? A. Walk the job site with the owner. B. Review the plans and specifications with the owner. C. Show the owner the critical path schedule. D. Include a payment schedule in the contract and review other details of the contract with the owner. - Answer Review the plans and specifications with the owner. When an owner signs a receipt for a stop notice, it usually means the owner: - Answer The owner recognizes that a lien could be placed on funds. To whom do you report and pay sales tax? - Answer The Board of Equalization DOSH must investigate a complaint charging a serious violation of health or safety standards within: - Answer DOSH must investigate a complaint charging a serious violation of health or safety standards within two working days. By law, a "hard laborer" may not be younger than ______ years old. - Answer A hard laborer may not be younger than 16 years old. When is the last day a customer can cancel a contract that was signed on Friday, December 21st? - Answer The following Wednesday. The customer has the right to cancel 3 business days after the day the contract has been signed and delivered to the. In this case: Saturday Midnight day one. Monday midnight day two Wednesday Midnight day three. NOTE: Sunday and Tuesday were not business days since Tuesday was a holiday. Correct answer is Wednesday midnight. When a notice of completion has been filed, the original contractor has how many days to record a lien. - Answer 60 days to record a lien. Which of the following financial ratios is the strictest measure of liquidity? A. Quick Ratio B. Current Ratio C. Profitability Ratio D. Leverage Ratio - Answer The quick ratio is the strictest measure of liquidity. When should you let your attorney see a construction contract? - Answer After the contract is prepared but before it is signed. How often are FICA taxes reported and paid? - Answer Quarterly Business records must be kept and made available for inspection by the Registrar of Contractors for a period of _____ after completion of a construction project or operation. CSLB CONTRACTOR'S LAW & BUSINESS EXAM QUESTIONS AND ANSWERS. A. One year B. Two years C. Three years D. Five years - Answer Business records must be kept for 5 years. Funds withheld to guarantee completion of a project and correction of defects are called a(n): - Answer Retention Direct costs are $37,000, overhead is 12% and profit is 5%. What is the selling price? - Answer $44,578.31 Add the 12% overhead and 5% profit together, then subtract that from 100% (83%). Then divide the total direct cost ($37,000) by the remaining percentage (83%) = 445.7831. A mechanics' lien is a written document that must be signed and verified by the claimant. The first and third steps a contractor should take in filing a lien are listed below. Step 1: Obtain the exact legal description of the property. Step 2: Step 3: Find out if the person requesting the work of improvement is the owner. What is Step 2? - Answer Find out the name of the legal owner of the property as well as the percent of ownership. A mechanics' lien. Step 1: Obtain the exact legal description of the property. Step 2: Find out the name of the legal owner of the property as well as the percent of ownership. Step 3: Find out if the person requesting the work of improvement is the owner. What happens after an employee's taxable wages exceed $7,000? - Answer After $7,000, the employer does not pay FUTA. A subcontractor who does not serve a preliminary notice: A. May not serve a stop notice but may file a mechanics' lien. B. May not file a mechanics' lien but may serve a stop notice C. loses both stop and mechanics's lien rights D. Loses nothing because subcontractors are not required to serve preliminary notices. - Answer A subcontractor that does not serve a preliminary notice loses both stop notice and mechanics' lien rights. If a sales presentation is made in Spanish, the home solicitation contract: - Answer Must be in Spanish. Who pays FUTA? - Answer The employer pays FUTA until an employees taxable wages exceed $7,000. CSLB CONTRACTOR'S LAW & BUSINESS EXAM QUESTIONS AND ANSWERS. If a contractor forgets to renew his or her license on time, the expired license may be renewed any time within _____ after its expiration without reapplying for a license and fulfilling the exam or waiver requirements again. - Answer Five years. How often are you required to pay sales tax? - Answer It depends on the expected amount of taxable sales. A contractor hires a subcontractor to demolish a concrete wall. Who is responsible for supplying safety goggles. - Answer Subcontractor How long does a client have to cancel a contract for repairs that are the result of an event for which a State of Emergency was declared? - Answer In a state of emergency, a client has 7 business days to cancel a contract for repairs. All of the following are causes for disciplinary action except: A. Allowing your license to be used by an unlined contractor. B. Entering into a contract with another contractor who is not licensed. C. During bankruptcy, setting obligations incurred as a contractor for less than the full amount owed. D. Willful or deliberate failure to pay money when due for materials or services. - Answer During bankruptcy, settling obligations incurred as a contractor for less than the full amount owed. What is the maximum allowed travel distance from any point of a work area to a fire extinguisher "Class "A"? - Answer 75 Feet