C-54 LICENSE LAW FINAL EXAM WITH
CORRECT QUESTIONS AND ANSWERS
2025
Which is true of depreciation?
A. If depreciation is not shown on the income- statement, this will under-estimate your
income
B. Depreciation is not shown on the Balance Sheet
C. Is the decrease in the value of all assets
D. Depreciation is an expense that lowers your tax liability - CORRECT-
ANSWERSDepreciation is an expense that lowers your tax liability.
Depreciation is a measurement of the "useful life" of a business asset,such as
machinery or a factory, to determine the multiyear period overwhich the cost of that
asset can be deducted from taxable income.Instead of allowing businesses to deduct
the cost of investmentsimmediately (i.e., full expensing), depreciation requires
deductionsto be taken over time, reducing their value and discouraging investment.
Which of the following is correct?
A. To keep a license, a contractor cannot have the license lapse more than 6-years
B. "Preliminary Notices", need to be filed within 20-days from the contract date
, C. A down-payment must be returned within 10-days from date of cancellation.
D. Copies of contracts should be kept 3-years - CORRECT-ANSWERSA down-payment
for a Home-Improvement Contract must be returned within 10-days from date of
cancellation.
Which agency is correctly paired with its function?
A. CA Dept. of Tax & Fee Administration (CDTFA) - collects state sales tax (and use tax)
B. Franchise Tax Board - collects unemployment tax.
C. Employment Development Department - administers Workers Compensation
Insurance.
D. Internal Revenue Service - collects State Disability Insurance.. - CORRECT-
ANSWERSCA Dept. of Tax & Fee Administration (CDTFA) - collects state sales tax (and
use tax).
A. The California Department of Tax and Fee Administration (CDIFA) is the public
agencycharged with assessing and collecting sales and use taxes, as well as a
varietyof excise fees and taxes, for the U.S., state of California.
In order to get a short-term loan from a bank, the bank will depend on: - CORRECT-
ANSWERSQuick Ratio - The quick ratio is another, more conservative way of testing
the adequacy of the current liquidity of the company. Instead of using current assents,
quick assents are substituted because these are quickly covered into cash. One simple
CORRECT QUESTIONS AND ANSWERS
2025
Which is true of depreciation?
A. If depreciation is not shown on the income- statement, this will under-estimate your
income
B. Depreciation is not shown on the Balance Sheet
C. Is the decrease in the value of all assets
D. Depreciation is an expense that lowers your tax liability - CORRECT-
ANSWERSDepreciation is an expense that lowers your tax liability.
Depreciation is a measurement of the "useful life" of a business asset,such as
machinery or a factory, to determine the multiyear period overwhich the cost of that
asset can be deducted from taxable income.Instead of allowing businesses to deduct
the cost of investmentsimmediately (i.e., full expensing), depreciation requires
deductionsto be taken over time, reducing their value and discouraging investment.
Which of the following is correct?
A. To keep a license, a contractor cannot have the license lapse more than 6-years
B. "Preliminary Notices", need to be filed within 20-days from the contract date
, C. A down-payment must be returned within 10-days from date of cancellation.
D. Copies of contracts should be kept 3-years - CORRECT-ANSWERSA down-payment
for a Home-Improvement Contract must be returned within 10-days from date of
cancellation.
Which agency is correctly paired with its function?
A. CA Dept. of Tax & Fee Administration (CDTFA) - collects state sales tax (and use tax)
B. Franchise Tax Board - collects unemployment tax.
C. Employment Development Department - administers Workers Compensation
Insurance.
D. Internal Revenue Service - collects State Disability Insurance.. - CORRECT-
ANSWERSCA Dept. of Tax & Fee Administration (CDTFA) - collects state sales tax (and
use tax).
A. The California Department of Tax and Fee Administration (CDIFA) is the public
agencycharged with assessing and collecting sales and use taxes, as well as a
varietyof excise fees and taxes, for the U.S., state of California.
In order to get a short-term loan from a bank, the bank will depend on: - CORRECT-
ANSWERSQuick Ratio - The quick ratio is another, more conservative way of testing
the adequacy of the current liquidity of the company. Instead of using current assents,
quick assents are substituted because these are quickly covered into cash. One simple
