NASCLA Business Law and Managment
EXAM SC 2026 Questions and Answers
Sole Proprietorship - Correct answer-a business owned and managed by a single
individual
Simplest form to set up
unlimited Liability
Partnerships - Correct answer-Business organizations in which two or more
persons share responsibilities, costs, profits, and losses.
C Corporations - Correct answer-Corporations that have no restrictions on who
owns their shares or the number of shareholders; they cannot qualify for
subchapter S tax treatment and are subject to direct taxation
S corporation - Correct answer-A unique government creation that looks like a
corporation but is taxed like sole proprietorships and partnerships
No more than 100 shareholders
FILING IRS FORM 2553
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,Limited liability company - Correct answer-A business organization in which the
business (not the owner) is liable for the company's debts
joint venture - Correct answer-an agreement between two or more companies to
share a business project
Reserving business Name - Correct answer-Register with secretary of state
Purpose of licensing - Correct answer-Protect Health, Safety, and welfare of the
public
When is a Contractors license Needed? - Correct answer-Excess of $5000
cease and desist order - Correct answer-ruling requiring a company to stop an
unfair business practice from performing work without a license
Monetary limitations for general and mechanical contractors - Correct answer-
determined by the financial net worth of the entity seeking licensure
Group Limitations - Correct answer-Divided into groups according to net worth.
Reciprocity - Correct answer-South Carolina has a reciprocal agreement with
certain states but licensee must still pass the business and law exam.
Property insurance - Correct answer-A type of insurance that covers damage to
property, such as a home.
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
, liability insurance - Correct answer-insurance that provides protection from claims
arising from injuries or damage to other people or property
Business Owners Policy (BOP) - Correct answer-Property and liability Coverage
are bundles under business owners policies
Automobile Insurance - Correct answer-Provides payments for both liability and
physical damage to vehicles
Burglary and Theft Insurance - Correct answer-Loss or damage by burglary, theft,
Larceny, Robbery, Forgery, Fraud, and vandalism.
Key Man Life Insurance - Correct answer-This type of insurance is available as life
insurance or disability insurance to protect continuing sucess of your business.
Coverage Gaps and Overlaps - Correct answer-It is important to evaluate all your
insurance coverage. Using one insurer may minimize gaps and overlaps in
coverage.
Bid Documents include - Correct answer-An invitation to Bid
Bid instructions
Bid forms
Supplements
©COPYRIGHT 2025, ALL RIGHTS RESERVED 3
EXAM SC 2026 Questions and Answers
Sole Proprietorship - Correct answer-a business owned and managed by a single
individual
Simplest form to set up
unlimited Liability
Partnerships - Correct answer-Business organizations in which two or more
persons share responsibilities, costs, profits, and losses.
C Corporations - Correct answer-Corporations that have no restrictions on who
owns their shares or the number of shareholders; they cannot qualify for
subchapter S tax treatment and are subject to direct taxation
S corporation - Correct answer-A unique government creation that looks like a
corporation but is taxed like sole proprietorships and partnerships
No more than 100 shareholders
FILING IRS FORM 2553
©COPYRIGHT 2025, ALL RIGHTS RESERVED 1
,Limited liability company - Correct answer-A business organization in which the
business (not the owner) is liable for the company's debts
joint venture - Correct answer-an agreement between two or more companies to
share a business project
Reserving business Name - Correct answer-Register with secretary of state
Purpose of licensing - Correct answer-Protect Health, Safety, and welfare of the
public
When is a Contractors license Needed? - Correct answer-Excess of $5000
cease and desist order - Correct answer-ruling requiring a company to stop an
unfair business practice from performing work without a license
Monetary limitations for general and mechanical contractors - Correct answer-
determined by the financial net worth of the entity seeking licensure
Group Limitations - Correct answer-Divided into groups according to net worth.
Reciprocity - Correct answer-South Carolina has a reciprocal agreement with
certain states but licensee must still pass the business and law exam.
Property insurance - Correct answer-A type of insurance that covers damage to
property, such as a home.
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
, liability insurance - Correct answer-insurance that provides protection from claims
arising from injuries or damage to other people or property
Business Owners Policy (BOP) - Correct answer-Property and liability Coverage
are bundles under business owners policies
Automobile Insurance - Correct answer-Provides payments for both liability and
physical damage to vehicles
Burglary and Theft Insurance - Correct answer-Loss or damage by burglary, theft,
Larceny, Robbery, Forgery, Fraud, and vandalism.
Key Man Life Insurance - Correct answer-This type of insurance is available as life
insurance or disability insurance to protect continuing sucess of your business.
Coverage Gaps and Overlaps - Correct answer-It is important to evaluate all your
insurance coverage. Using one insurer may minimize gaps and overlaps in
coverage.
Bid Documents include - Correct answer-An invitation to Bid
Bid instructions
Bid forms
Supplements
©COPYRIGHT 2025, ALL RIGHTS RESERVED 3
