CSLB CONTRACTOR'S LAW & BUSINESS
EXAM (Actual Exam 2026) | Complete
Questions and Correct Answers | Graded
A+ | Latest Version | Verified Answers |
Brand New Version!
1. An employer remits State disability taxes withheld from
an employees wages to what agency?
Correct Answer: Employment Development Department
2. Which act establishes the rights of workers to organize
into unions and negotiate contracts?
Correct Answer: National Labor Relations Act of 1935
3. A contractor has had a problem with employees stealing
tools and equipment from job sites. When conducting job
interviews, may the contractor ask prospective employees
about their arrest records?
A. It is legal to ask prospective employees about arrests not
leading to convictions.
B. It is not legal to ask prospective employees about arrests
,not leading to convictions.
C. It is legal for a private employer to ask about arrests not
leading to convictions, but it would not be legal for city or
county agencies to ask about such arrests.
D. It is legal for a private employer to ask about arrests
leading to convictions, but it would not be legal for a federal,
state, or local public agency to do so.
Correct Answer: It is not legal to ask prospective employees
about arrests not leading to convictions.
4. Why would a contractor have a case in Superior Court?
Correct Answer: If it is a dispute of more than $25,000 it can
be transferred to Superior Court.
5. Which would not have to be reported to DOSH
immediately or within 24 hours?
A. Death from a three-story fall.
B. Drunken crane operator hits a high-voltage power line.
C. Car accident in which an employee steps onto a public
road, gets hit by a car, and suffers a concussion.
D. Employee falls off forklift and suffers a severe back injury.
Correct Answer: Car accident in which an employee steps
onto a public road, gets hit by a car, and suffers a concussion.
,6. A general contractor has obtained bids from several
subcontractors for a private project. He notices that one
bid is substantially lower than the rest. Is it ethical and a
good business practice for this contractor to inform the
subcontractor that the bid is substantially lower than the
bids of the other subcontractors?
Correct Answer: Yes. If the contractor has reason to believe
that the subcontractor has made an error in preparing his bid,
the contractor should notify the subcontractor of the apparent
error, but the contractor may not disclose the amounts of the
other bids.
7. An employer must furnish an employee with a
completed IRS Form W-2 (Wage and Tax Statement) by:
Correct Answer: The 31st of January.
8. After a job is completed, the owner decides to have
additional work done. How should the contractor proceed?
Correct Answer: Write a new contract and ask the owner to
sign it.
9. The purpose of a 20-day preliminary notice for private
work is to?
, Correct Answer: Notify the owner that the person or firm
who sent the notice has improved the property.
10. Is it legal for a contractor to pay employees in cash?
Correct Answer: Yes, if the contractor provides each
employee with a wage deduction statement semimonthly or at
the time of each wage payment.
11. You are bidding on a job with plans drawn by the
owner. You notice a code violation and bring it to the
attention of the owner. The owner declines to remedy the
code violation and tells you not to worry. What should you
do?
Correct Answer: Decline to bid the work.
12. On a time-and-materials job, you should:
Correct Answer: Add profit and overhead to labor and
materials.
13. Your employee sets a cabinet wrong. The cabinet falls
from the wall and damages the client's counter top. What
should you do?
A. Claim the damage on your general liability insurance
policy.
B. Require the employee to pay for the damage to the
EXAM (Actual Exam 2026) | Complete
Questions and Correct Answers | Graded
A+ | Latest Version | Verified Answers |
Brand New Version!
1. An employer remits State disability taxes withheld from
an employees wages to what agency?
Correct Answer: Employment Development Department
2. Which act establishes the rights of workers to organize
into unions and negotiate contracts?
Correct Answer: National Labor Relations Act of 1935
3. A contractor has had a problem with employees stealing
tools and equipment from job sites. When conducting job
interviews, may the contractor ask prospective employees
about their arrest records?
A. It is legal to ask prospective employees about arrests not
leading to convictions.
B. It is not legal to ask prospective employees about arrests
,not leading to convictions.
C. It is legal for a private employer to ask about arrests not
leading to convictions, but it would not be legal for city or
county agencies to ask about such arrests.
D. It is legal for a private employer to ask about arrests
leading to convictions, but it would not be legal for a federal,
state, or local public agency to do so.
Correct Answer: It is not legal to ask prospective employees
about arrests not leading to convictions.
4. Why would a contractor have a case in Superior Court?
Correct Answer: If it is a dispute of more than $25,000 it can
be transferred to Superior Court.
5. Which would not have to be reported to DOSH
immediately or within 24 hours?
A. Death from a three-story fall.
B. Drunken crane operator hits a high-voltage power line.
C. Car accident in which an employee steps onto a public
road, gets hit by a car, and suffers a concussion.
D. Employee falls off forklift and suffers a severe back injury.
Correct Answer: Car accident in which an employee steps
onto a public road, gets hit by a car, and suffers a concussion.
,6. A general contractor has obtained bids from several
subcontractors for a private project. He notices that one
bid is substantially lower than the rest. Is it ethical and a
good business practice for this contractor to inform the
subcontractor that the bid is substantially lower than the
bids of the other subcontractors?
Correct Answer: Yes. If the contractor has reason to believe
that the subcontractor has made an error in preparing his bid,
the contractor should notify the subcontractor of the apparent
error, but the contractor may not disclose the amounts of the
other bids.
7. An employer must furnish an employee with a
completed IRS Form W-2 (Wage and Tax Statement) by:
Correct Answer: The 31st of January.
8. After a job is completed, the owner decides to have
additional work done. How should the contractor proceed?
Correct Answer: Write a new contract and ask the owner to
sign it.
9. The purpose of a 20-day preliminary notice for private
work is to?
, Correct Answer: Notify the owner that the person or firm
who sent the notice has improved the property.
10. Is it legal for a contractor to pay employees in cash?
Correct Answer: Yes, if the contractor provides each
employee with a wage deduction statement semimonthly or at
the time of each wage payment.
11. You are bidding on a job with plans drawn by the
owner. You notice a code violation and bring it to the
attention of the owner. The owner declines to remedy the
code violation and tells you not to worry. What should you
do?
Correct Answer: Decline to bid the work.
12. On a time-and-materials job, you should:
Correct Answer: Add profit and overhead to labor and
materials.
13. Your employee sets a cabinet wrong. The cabinet falls
from the wall and damages the client's counter top. What
should you do?
A. Claim the damage on your general liability insurance
policy.
B. Require the employee to pay for the damage to the
