CALIFORNIA STATE CONTRACTORS
LICENSE LAW AND BUSINESS TEST
STUDY GUIDE QUESTIONS AND
SOLUTIONS
What is the term given to a worker in training? ✔ansApprentice
What is the term given to a worker who is able to perform trade work unsupervised? ✔ansJourneyman
Who is responsible for training employees? ✔ansForeman, Supervisor
What is a foreman required to do for safety reasons, every ten days? ✔ansConduct a safety meeting
Covers your property, tools and office against fire, storm, theft etc... It does not cover your employees
tools. ✔ansProperty Insurance
Covers your vehicles, trucks, equipment or trailers while you or your employees are driving them.
✔ansVehicle Insurance
Covers against vandalism and theft of your property at the job site. ✔ansBuilder's Risk Insurance
Covers the loss of a person who performs a crucial role in your company by compensating the business.
✔ansKey Person Insurance
It covers interruptions such as lawsuits, absence of owner, severe weather... ✔ansBusiness Interruption
Insurance
Covers the death of a person by compensating the survivors, or family members. ✔ansLife Insurance
, This policy goes above and beyond standard insurances and is therefore more expensive. Most smaller
companies do not have this for that reason. ✔ansUmbrella Policy
A No Fault insurance purchased by the employer and supervised by the state designed to limit the
liability of the employer by reducing costly lawsuits and providing prompt rehabilitation for job related
injuries. ✔ansWorker's Compensation Insurance
If you have how many employees, even for part time, a worker's comp policy must be obtained and
filed. ✔ansOne
A workers compensation policy is not required for ___ or ___ licenses ✔ansinactive or expired licenses
If the contractor has no employees, worker's comp is not required. However he or she must file what,
which is available online. ✔ansAn exemption form
What two things should be considered when buying insurance? ✔ansCost and coverage
Protects the suppliers, subcontractors and laborers in case the contractor does not pay them what is
owed under the contract. ✔ansPayment Bond
Protects the owner in case the job is abandoned or the work proves to be unacceptable.
✔ansPerformance Bond
Which bond covers both payments and completion of the contract? ✔ansContract Bond
Money owed to the owner or owners of a company. ✔ansEquity
debts which are due within the year ✔ansCurrent liabilities
debts which are due beyond one year, like mortgages or a bank loan. ✔ansLong Term Liabilities
LICENSE LAW AND BUSINESS TEST
STUDY GUIDE QUESTIONS AND
SOLUTIONS
What is the term given to a worker in training? ✔ansApprentice
What is the term given to a worker who is able to perform trade work unsupervised? ✔ansJourneyman
Who is responsible for training employees? ✔ansForeman, Supervisor
What is a foreman required to do for safety reasons, every ten days? ✔ansConduct a safety meeting
Covers your property, tools and office against fire, storm, theft etc... It does not cover your employees
tools. ✔ansProperty Insurance
Covers your vehicles, trucks, equipment or trailers while you or your employees are driving them.
✔ansVehicle Insurance
Covers against vandalism and theft of your property at the job site. ✔ansBuilder's Risk Insurance
Covers the loss of a person who performs a crucial role in your company by compensating the business.
✔ansKey Person Insurance
It covers interruptions such as lawsuits, absence of owner, severe weather... ✔ansBusiness Interruption
Insurance
Covers the death of a person by compensating the survivors, or family members. ✔ansLife Insurance
, This policy goes above and beyond standard insurances and is therefore more expensive. Most smaller
companies do not have this for that reason. ✔ansUmbrella Policy
A No Fault insurance purchased by the employer and supervised by the state designed to limit the
liability of the employer by reducing costly lawsuits and providing prompt rehabilitation for job related
injuries. ✔ansWorker's Compensation Insurance
If you have how many employees, even for part time, a worker's comp policy must be obtained and
filed. ✔ansOne
A workers compensation policy is not required for ___ or ___ licenses ✔ansinactive or expired licenses
If the contractor has no employees, worker's comp is not required. However he or she must file what,
which is available online. ✔ansAn exemption form
What two things should be considered when buying insurance? ✔ansCost and coverage
Protects the suppliers, subcontractors and laborers in case the contractor does not pay them what is
owed under the contract. ✔ansPayment Bond
Protects the owner in case the job is abandoned or the work proves to be unacceptable.
✔ansPerformance Bond
Which bond covers both payments and completion of the contract? ✔ansContract Bond
Money owed to the owner or owners of a company. ✔ansEquity
debts which are due within the year ✔ansCurrent liabilities
debts which are due beyond one year, like mortgages or a bank loan. ✔ansLong Term Liabilities
