CALIFORNIA DEALER LICENSE EXAM QUESTIONS
WITH 100% CORRECT ANSWERS | NEW UPDATED
2026-2027 | GRADED A+.
“A dealer's license and special plates shall be automatically canceled
if: - CORRECT ANSWER The dealer abandons the established place
of business, The dealer fails to maintain an adequate bond, and The
CDTFA resale permit is suspended"
"A dealer must affix to all vehicles offered for sale: - CORRECT
ANSWER A federal trade commission buyers guide"
"All the agreements of the buyer and seller with respect to the total
cost and terms of payment must be contained in a single document.
That document is: - CORRECT ANSWER The conditional sales
contract"
"Within 20 days after the sale of a consigned vehicle the dealer must
notify the consigner of: - CORRECT ANSWER The date of sale, The
amount of any lien payable to the lienholder, and The total sales price"
"A California law does not provide an included "cooling off "period or
other cancellation period for vehicle sales. The only exception is: -
CORRECT ANSWER For legal cause such as fraud or with the
agreement of the seller"
1
,"What is the maximum markup that dealers may add to a loan for
their own profit? - CORRECT ANSWER 2.5% on loans 60 or fewer
months, 2% on loans 60 months or more"
"Effective July 1, 2006, dealers who advertise a vehicle as "certified"
will be in violation of the law if the vehicle they are referring to in the
ad has the following history: - CORRECT ANSWER Salvage and
Frame damage"
"Which legal actions may be taken against a dealer if they violate the
laws, rules and regulations related to their licensed activity? -
CORRECT ANSWER Administrative action, Criminal action, and
Civil action"
"Which documents are used to disclose the total cost and terms of
payment? - CORRECT ANSWER The conditional sales contract"
"As the selling dealer, you may allow the customer to take the vehicle
to get their own smog certificate: - CORRECT ANSWER You may
never allow the customer to take the vehicle to get their own smog
certificate"
"Of the following used vehicle sale prices, which would a dealer not
2
,be required to offer a contract cancellation option agreement? -
CORRECT ANSWER $52,995"
"What must a dealer do when selling vehicles at temporary location?
- CORRECT ANSWER Apply for a "Temporary Branch Location""
"How much notice is required when applying for a temporary branch
location? - CORRECT ANSWER 30 Days"
"What is the purpose of Division 12 of the Vehicle Code? - CORRECT
ANSWER Regulates the manner in which vehicles are equipped for
safe operation"
"How many cars can a private individual legally sell per year with the
intent to make a profit? - CORRECT ANSWER None"
"After return of the vehicle under the cancellation option rules, how
soon must the dealer make refund to the customer? - CORRECT
ANSWER Within 48 Hours"
"Which of the following signs has to be posted in dealership office? -
CORRECT ANSWER No cooling off period & Vehicle inspection
signs, Business License, Seller's Permit, Dealer License, Salesperson's
license(s)"
3
, "What is the minimum passing score for the DMV Exam? - CORRECT
ANSWER 70%"
"Before you can apply for your dealer license, you need to get a resale
permit (seller's permit) from where? - CORRECT ANSWER The
CDFTA"
"What is required in every dealer's advertisement for a vehicle for
sale? - CORRECT ANSWER Make and model, Last 6 of the VIN,
Dealership name"
"California dealer advertising laws apply to which, of the following
media types: - CORRECT ANSWER All forms of media"
"What is the DMV dealer test fee? - CORRECT ANSWER $16"
"What is the number of vehicles you can sell per year without a valid
license? - CORRECT ANSWER 0"
"What is the required bond or cash amount? - CORRECT ANSWER
50,000"
4
WITH 100% CORRECT ANSWERS | NEW UPDATED
2026-2027 | GRADED A+.
“A dealer's license and special plates shall be automatically canceled
if: - CORRECT ANSWER The dealer abandons the established place
of business, The dealer fails to maintain an adequate bond, and The
CDTFA resale permit is suspended"
"A dealer must affix to all vehicles offered for sale: - CORRECT
ANSWER A federal trade commission buyers guide"
"All the agreements of the buyer and seller with respect to the total
cost and terms of payment must be contained in a single document.
That document is: - CORRECT ANSWER The conditional sales
contract"
"Within 20 days after the sale of a consigned vehicle the dealer must
notify the consigner of: - CORRECT ANSWER The date of sale, The
amount of any lien payable to the lienholder, and The total sales price"
"A California law does not provide an included "cooling off "period or
other cancellation period for vehicle sales. The only exception is: -
CORRECT ANSWER For legal cause such as fraud or with the
agreement of the seller"
1
,"What is the maximum markup that dealers may add to a loan for
their own profit? - CORRECT ANSWER 2.5% on loans 60 or fewer
months, 2% on loans 60 months or more"
"Effective July 1, 2006, dealers who advertise a vehicle as "certified"
will be in violation of the law if the vehicle they are referring to in the
ad has the following history: - CORRECT ANSWER Salvage and
Frame damage"
"Which legal actions may be taken against a dealer if they violate the
laws, rules and regulations related to their licensed activity? -
CORRECT ANSWER Administrative action, Criminal action, and
Civil action"
"Which documents are used to disclose the total cost and terms of
payment? - CORRECT ANSWER The conditional sales contract"
"As the selling dealer, you may allow the customer to take the vehicle
to get their own smog certificate: - CORRECT ANSWER You may
never allow the customer to take the vehicle to get their own smog
certificate"
"Of the following used vehicle sale prices, which would a dealer not
2
,be required to offer a contract cancellation option agreement? -
CORRECT ANSWER $52,995"
"What must a dealer do when selling vehicles at temporary location?
- CORRECT ANSWER Apply for a "Temporary Branch Location""
"How much notice is required when applying for a temporary branch
location? - CORRECT ANSWER 30 Days"
"What is the purpose of Division 12 of the Vehicle Code? - CORRECT
ANSWER Regulates the manner in which vehicles are equipped for
safe operation"
"How many cars can a private individual legally sell per year with the
intent to make a profit? - CORRECT ANSWER None"
"After return of the vehicle under the cancellation option rules, how
soon must the dealer make refund to the customer? - CORRECT
ANSWER Within 48 Hours"
"Which of the following signs has to be posted in dealership office? -
CORRECT ANSWER No cooling off period & Vehicle inspection
signs, Business License, Seller's Permit, Dealer License, Salesperson's
license(s)"
3
, "What is the minimum passing score for the DMV Exam? - CORRECT
ANSWER 70%"
"Before you can apply for your dealer license, you need to get a resale
permit (seller's permit) from where? - CORRECT ANSWER The
CDFTA"
"What is required in every dealer's advertisement for a vehicle for
sale? - CORRECT ANSWER Make and model, Last 6 of the VIN,
Dealership name"
"California dealer advertising laws apply to which, of the following
media types: - CORRECT ANSWER All forms of media"
"What is the DMV dealer test fee? - CORRECT ANSWER $16"
"What is the number of vehicles you can sell per year without a valid
license? - CORRECT ANSWER 0"
"What is the required bond or cash amount? - CORRECT ANSWER
50,000"
4
