NORTH CAROLINA GENERAL CONTRACTOR
EXAMINATION
PRACTICE QUESTIONS WITH ANSWERS AND
RATIONALES
SECTION 1: LICENSING AND REGULATORY COMPLIANCE (Questions 1–15)
Question 1: Under North Carolina law, a general contractor must hold a license when the total
project cost exceeds what amount?
Answer: $40,000.
Rationale: North Carolina law requires a general contractor to be licensed if the total project
cost is valued at $40,000 or higher. This threshold applies to all construction projects, including
residential and commercial work. Projects valued at less than $40,000 do not require a state
license.
Question 2: Which North Carolina statute governs the licensing and regulation of general
contractors?
Answer: Chapter 87, Article 1 of the North Carolina General Statutes.
Rationale: The practice act providing specific regulatory authority over general contractors is
found under N.C. General Statute 87, Article 1. This chapter establishes the North Carolina
,Licensing Board for General Contractors (NCLBGC) and sets forth the requirements for
licensure, including experience, examination, financial responsibility, and disciplinary actions.
Question 3: What is the minimum age requirement to apply for a general contractor license in
North Carolina?
Answer: 18 years of age.
Rationale: Under N.C.G.S. § 87-10(a)(1), an applicant for a general contractor license must be
at least 18 years of age. This is a fundamental eligibility requirement, along with good moral
character, evidence of financial responsibility, and consent to a criminal background check if
required by the Board.
Question 4: What are the three monetary limit classifications for North Carolina contractor
licenses?
Answer: Limited, Intermediate, and Unlimited.
Rationale: N.C.G.S. § 87-10 establishes three license classifications based on monetary limits.
The holder of an unlimited license may act as a general contractor without restriction as to the
value of any single project. An intermediate license allows projects up to $1,500,000. A limited
license allows projects up to $750,000.
,Question 5: An applicant for a North Carolina general contractor license must provide evidence
of what?
Answer: Financial responsibility as determined by the Board.
Rationale: N.C.G.S. § 87-10(a)(3) requires applicants to provide evidence of financial
responsibility as determined by the Board. This is demonstrated through financial statements
showing the required working capital or net worth, and may also require a surety bond meeting
the Board's requirements.
Question 6: A contractor's license is displayed on a bid document. What must be included on the
bid?
Answer: The contractor's license number.
Rationale: North Carolina law requires the contractor's license number to appear on all bids,
contracts, and advertisements. This allows consumers to verify the contractor's license status
with the NCLBGC and helps prevent unlicensed contracting. Failure to include the license
number can result in disciplinary action.
Question 7: What is a "qualifier" or "qualifying party" in the context of North Carolina
contractor licensing?
, Answer: The individual who has successfully passed the examination and whose name appears
on the license.
Rationale: N.C.G.S. § 87-10(b) requires applicants to identify an individual who has successfully
passed an examination approved by the Board, known as the "qualifier" or "qualifying party".
This individual is primarily responsible for ensuring compliance with licensing regulations. The
qualifier must be 18 years of age or older and can serve multiple companies with Board
approval.
Question 8: Under North Carolina law, what is the penalty for unlicensed contracting?
Answer: A Class 2 misdemeanor with potential fines.
Rationale: Unlicensed contracting is a serious offense in North Carolina. It is classified as a
Class 2 misdemeanor with potential fines. Additionally, an unlicensed contractor cannot file a
mechanics lien or sue to collect payment for work performed. The NCLBGC actively investigates
and prosecutes unlicensed contractors.
Question 9: How often must a North Carolina general contractor renew their license?
Answer: Annually.
Rationale: North Carolina general contractors are required to renew their licenses annually. As
part of the renewal process, licensees must complete 8 hours of continuing education annually,
EXAMINATION
PRACTICE QUESTIONS WITH ANSWERS AND
RATIONALES
SECTION 1: LICENSING AND REGULATORY COMPLIANCE (Questions 1–15)
Question 1: Under North Carolina law, a general contractor must hold a license when the total
project cost exceeds what amount?
Answer: $40,000.
Rationale: North Carolina law requires a general contractor to be licensed if the total project
cost is valued at $40,000 or higher. This threshold applies to all construction projects, including
residential and commercial work. Projects valued at less than $40,000 do not require a state
license.
Question 2: Which North Carolina statute governs the licensing and regulation of general
contractors?
Answer: Chapter 87, Article 1 of the North Carolina General Statutes.
Rationale: The practice act providing specific regulatory authority over general contractors is
found under N.C. General Statute 87, Article 1. This chapter establishes the North Carolina
,Licensing Board for General Contractors (NCLBGC) and sets forth the requirements for
licensure, including experience, examination, financial responsibility, and disciplinary actions.
Question 3: What is the minimum age requirement to apply for a general contractor license in
North Carolina?
Answer: 18 years of age.
Rationale: Under N.C.G.S. § 87-10(a)(1), an applicant for a general contractor license must be
at least 18 years of age. This is a fundamental eligibility requirement, along with good moral
character, evidence of financial responsibility, and consent to a criminal background check if
required by the Board.
Question 4: What are the three monetary limit classifications for North Carolina contractor
licenses?
Answer: Limited, Intermediate, and Unlimited.
Rationale: N.C.G.S. § 87-10 establishes three license classifications based on monetary limits.
The holder of an unlimited license may act as a general contractor without restriction as to the
value of any single project. An intermediate license allows projects up to $1,500,000. A limited
license allows projects up to $750,000.
,Question 5: An applicant for a North Carolina general contractor license must provide evidence
of what?
Answer: Financial responsibility as determined by the Board.
Rationale: N.C.G.S. § 87-10(a)(3) requires applicants to provide evidence of financial
responsibility as determined by the Board. This is demonstrated through financial statements
showing the required working capital or net worth, and may also require a surety bond meeting
the Board's requirements.
Question 6: A contractor's license is displayed on a bid document. What must be included on the
bid?
Answer: The contractor's license number.
Rationale: North Carolina law requires the contractor's license number to appear on all bids,
contracts, and advertisements. This allows consumers to verify the contractor's license status
with the NCLBGC and helps prevent unlicensed contracting. Failure to include the license
number can result in disciplinary action.
Question 7: What is a "qualifier" or "qualifying party" in the context of North Carolina
contractor licensing?
, Answer: The individual who has successfully passed the examination and whose name appears
on the license.
Rationale: N.C.G.S. § 87-10(b) requires applicants to identify an individual who has successfully
passed an examination approved by the Board, known as the "qualifier" or "qualifying party".
This individual is primarily responsible for ensuring compliance with licensing regulations. The
qualifier must be 18 years of age or older and can serve multiple companies with Board
approval.
Question 8: Under North Carolina law, what is the penalty for unlicensed contracting?
Answer: A Class 2 misdemeanor with potential fines.
Rationale: Unlicensed contracting is a serious offense in North Carolina. It is classified as a
Class 2 misdemeanor with potential fines. Additionally, an unlicensed contractor cannot file a
mechanics lien or sue to collect payment for work performed. The NCLBGC actively investigates
and prosecutes unlicensed contractors.
Question 9: How often must a North Carolina general contractor renew their license?
Answer: Annually.
Rationale: North Carolina general contractors are required to renew their licenses annually. As
part of the renewal process, licensees must complete 8 hours of continuing education annually,
