FLORIDA GENERAL CONTRACTOR – PROJECT MANAGEMENT
EXAM | QUESTIONS AND ANSWERS | VERIFIED ANSWERS PLUS
RATIONALES | LATEST EXAM UPDATE
EXAM COVERS THE FOLLOWING TOPICS
Project Management (PM) Exam
• Contract administration
• Scheduling
• Cost control
• Safety
• Labor laws
TOPIC 1: CONTRACT ADMINISTRATION
1. The primary purpose of contract administration in construction is to:
A. Supervise laborers
B. Ensure compliance with contract terms
C. Increase contractor profit
D. Eliminate inspections
Answer: B. Ensure compliance with contract terms
Rationale: Contract administration involves managing the contractual
relationship to ensure all parties fulfill obligations related to scope, time, cost,
and quality.
2. In a lump sum contract, the contractor assumes the greatest risk for:
A. Design errors
B. Owner financing
C. Cost overruns
D. Permit approval
,Answer: C. Cost overruns
Rationale: Under a fixed-price (lump sum) agreement, the contractor must
complete the work for the agreed amount, absorbing excess costs unless
covered by change order.
3. A properly executed change order must include:
A. Verbal approval
B. Revised contract time and cost
C. Architect’s personal opinion
D. Inspection certificate
Answer: B. Revised contract time and cost
Rationale: Change orders modify contract scope and must clearly state
adjustments to price and/or contract duration.
4. The document that itemizes contract value by work divisions is the:
A. Bid bond
B. Schedule of values
C. Performance bond
D. Certificate of occupancy
Answer: B. Schedule of values
Rationale: The schedule of values allocates the contract sum across various
work components and forms the basis for progress payments.
5. Retainage is typically withheld to:
A. Pay subcontractors early
B. Cover tax obligations
C. Ensure proper completion
D. Fund owner contingencies
Answer: C. Ensure proper completion
Rationale: Retainage incentivizes the contractor to complete all work,
including punch list items.
6. Substantial completion occurs when:
,A. Final payment is issued
B. Punch list is fully complete
C. Project is usable for intended purpose
D. Warranty expires
Answer: C. Project is usable for intended purpose
Rationale: Substantial completion is achieved when the owner can occupy or
use the facility for its intended function.
7. Liquidated damages must be:
A. Punitive in nature
B. Reasonably estimated at contract execution
C. Determined after dispute
D. Equal to contractor overhead
Answer: B. Reasonably estimated at contract execution
Rationale: Liquidated damages must reflect a reasonable pre-estimate of loss
and not serve as a penalty.
8. A notice to proceed establishes:
A. Contract completion
B. Final inspection date
C. Beginning of contract time
D. Warranty obligations
Answer: C. Beginning of contract time
Rationale: The notice to proceed formally authorizes the contractor to begin
work and starts the contract duration.
9. Shop drawings are reviewed primarily to verify:
A. Means and methods responsibility
B. Compliance with design intent
C. Contractor profit margins
D. Labor rates
Answer: B. Compliance with design intent
Rationale: The design professional reviews shop drawings to confirm
, alignment with project specifications, not to assume responsibility for
fabrication.
10. A performance bond protects the:
A. Contractor
B. Subcontractor
C. Owner
D. Architect
Answer: C. Owner
Rationale: A performance bond guarantees project completion if the
contractor defaults.
11. A payment bond ensures:
A. Completion of schedule
B. Payment to subcontractors and suppliers
C. Building code compliance
D. OSHA enforcement
Answer: B. Payment to subcontractors and suppliers
Rationale: A payment bond protects subcontractors and suppliers from
nonpayment.
12. A construction lien secures:
A. Owner’s financing
B. Contractor’s payment rights
C. Permit approval
D. Architect liability
Answer: B. Contractor’s payment rights
Rationale: Construction liens provide legal recourse against property for
unpaid labor or materials.
13. Final payment is typically conditioned upon:
A. Subcontractor verbal confirmation
B. Delivery of closeout documents
EXAM | QUESTIONS AND ANSWERS | VERIFIED ANSWERS PLUS
RATIONALES | LATEST EXAM UPDATE
EXAM COVERS THE FOLLOWING TOPICS
Project Management (PM) Exam
• Contract administration
• Scheduling
• Cost control
• Safety
• Labor laws
TOPIC 1: CONTRACT ADMINISTRATION
1. The primary purpose of contract administration in construction is to:
A. Supervise laborers
B. Ensure compliance with contract terms
C. Increase contractor profit
D. Eliminate inspections
Answer: B. Ensure compliance with contract terms
Rationale: Contract administration involves managing the contractual
relationship to ensure all parties fulfill obligations related to scope, time, cost,
and quality.
2. In a lump sum contract, the contractor assumes the greatest risk for:
A. Design errors
B. Owner financing
C. Cost overruns
D. Permit approval
,Answer: C. Cost overruns
Rationale: Under a fixed-price (lump sum) agreement, the contractor must
complete the work for the agreed amount, absorbing excess costs unless
covered by change order.
3. A properly executed change order must include:
A. Verbal approval
B. Revised contract time and cost
C. Architect’s personal opinion
D. Inspection certificate
Answer: B. Revised contract time and cost
Rationale: Change orders modify contract scope and must clearly state
adjustments to price and/or contract duration.
4. The document that itemizes contract value by work divisions is the:
A. Bid bond
B. Schedule of values
C. Performance bond
D. Certificate of occupancy
Answer: B. Schedule of values
Rationale: The schedule of values allocates the contract sum across various
work components and forms the basis for progress payments.
5. Retainage is typically withheld to:
A. Pay subcontractors early
B. Cover tax obligations
C. Ensure proper completion
D. Fund owner contingencies
Answer: C. Ensure proper completion
Rationale: Retainage incentivizes the contractor to complete all work,
including punch list items.
6. Substantial completion occurs when:
,A. Final payment is issued
B. Punch list is fully complete
C. Project is usable for intended purpose
D. Warranty expires
Answer: C. Project is usable for intended purpose
Rationale: Substantial completion is achieved when the owner can occupy or
use the facility for its intended function.
7. Liquidated damages must be:
A. Punitive in nature
B. Reasonably estimated at contract execution
C. Determined after dispute
D. Equal to contractor overhead
Answer: B. Reasonably estimated at contract execution
Rationale: Liquidated damages must reflect a reasonable pre-estimate of loss
and not serve as a penalty.
8. A notice to proceed establishes:
A. Contract completion
B. Final inspection date
C. Beginning of contract time
D. Warranty obligations
Answer: C. Beginning of contract time
Rationale: The notice to proceed formally authorizes the contractor to begin
work and starts the contract duration.
9. Shop drawings are reviewed primarily to verify:
A. Means and methods responsibility
B. Compliance with design intent
C. Contractor profit margins
D. Labor rates
Answer: B. Compliance with design intent
Rationale: The design professional reviews shop drawings to confirm
, alignment with project specifications, not to assume responsibility for
fabrication.
10. A performance bond protects the:
A. Contractor
B. Subcontractor
C. Owner
D. Architect
Answer: C. Owner
Rationale: A performance bond guarantees project completion if the
contractor defaults.
11. A payment bond ensures:
A. Completion of schedule
B. Payment to subcontractors and suppliers
C. Building code compliance
D. OSHA enforcement
Answer: B. Payment to subcontractors and suppliers
Rationale: A payment bond protects subcontractors and suppliers from
nonpayment.
12. A construction lien secures:
A. Owner’s financing
B. Contractor’s payment rights
C. Permit approval
D. Architect liability
Answer: B. Contractor’s payment rights
Rationale: Construction liens provide legal recourse against property for
unpaid labor or materials.
13. Final payment is typically conditioned upon:
A. Subcontractor verbal confirmation
B. Delivery of closeout documents
