CSLB CONTRACTOR'S LAW & BUSINESS EXAM
LATEST VERSION 2023 2024 QUESTIONS AND
CORRECT CORRECT ANSWER WERS
GUARANTEED SUCCESS
_____, although usually the largest single item in a bid, can be fairly accurately determined. - CORRECT ANSWER Materials
"Contractors are required by law to be licensed and regulated by the Contractors' State License Board. Any questions concerning a contractor may be referred to the Registrar, Contractors' State License Board, P.O. Box 26000, Sacramento, California, 95826."
This statement must be on: - CORRECT ANSWER All prime contracts.
A balance sheet shows: - CORRECT ANSWER A balance sheet shows assets and
liabilities at a certain point in time.
A client wants the house painted and carpet installed. What license classification(s) is/are required for this work? - CORRECT ANSWER Painting and decorating C-33 and floor covering C-15.
A construction company was hiring a new crew and asked each prospective employee for their name, address, and Social Security number. Several prospective employees remembered their Social Security numbers but did not have a card or other documentation. The practice of relying on memorized Social Security numbers is: -
CORRECT ANSWER Unacceptable: The actual Social Security card should have been
inspected.
A consumer may cancel a home solicitation contract at any time prior to midnight of the _____ after the date of the trCORRECT ANSWER action.
- 2nd business day
- 3rd business day
- 5th business day
- 7th calendar day - CORRECT ANSWER A consumer may cancel a home solicitation
contract at anytime prior to midnight of the 3rd business day after the date of the trCORRECT ANSWER action.
A contractor bids on a home improvement project and earns the bid. Later, he decides not to take the job. Which bond would protect the home owner? - CORRECT ANSWER A bid bond would protect the client from a contractor who declines to take a job that has already bid.
A contractor buys a construction firm from a person who is retiring. There is an existing collective bargaining agreement with a successor clause that is good for three years. As the new owner, is the contractor bound by the collective bargaining agreement? - 1 / 3
CORRECT ANSWER Yes a successor clause in a collective bargaining agreement is binding on a successor for up to three years.
A contractor entered into a home improvement contract for more than $500 with Mrs.Swenson to remodel her kitchen and bathroom. The contract calls for a down payment before work is to begin. According to the Business and Professions Code, how much may the contractor accept from Mrs. Swenson as down payment for the work? - CORRECT ANSWER The down payment is limited to $1,000 or 10% of the total price, which ever is less.
A contractor finds a 6" discrepancy on a set of plCORRECT ANSWER . The contractor
should: - CORRECT ANSWER Contact the architect or the building designer.
A contractor has been turned in to DOSH by an employee for a safety violation. The contractor wants to find out who reported the violation and asked DOSH for the employee's name. What will DOSH likely do? - CORRECT ANSWER Unless requested otherwise, DOSH will keep confidential the name of any person making a complaint, and no retaliation may be directed at the employee if the employee's identity is discovered.
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?
- It is legal to ask prospective employees about arrests not leading to convictions.
- It is not legal to ask prospective employees about arrests not leading to convictions.
- 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.
- 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 arrest not leading to convictions.
A contractor hires a subcontractor to demolish a concrete wall. Who is responsible for supplying safety goggles. - CORRECT ANSWER Subcontractor
A contractor is bidding on a project for a homeowner. The homeowner has included several "extra" items to be bid upon. After receiving the bid, the homeowner said it was too high and asked the contractor to lower the price. What should the contractor do? - CORRECT ANSWER Negotiate with the homeowner to reduce the scope of the work by eliminating some of the extra items.
- / 3
A contractor is looking for an insurance policy to cover a high degree of exposure to risk. Of the following, which policy would be the best for this purpose?
- Property
- General Liability
- Builder's Risk
- Umbrella - CORRECT ANSWER Umbrella policy. But the umbrella policy would only
cover the high degree of exposure if it was covered by one of the underlying policies.
A contractor meets Mr. Jones at his home to discuss remodeling. The contractor and Mr. Jones sign a contract that includes a three-day cancellation form. After the contractor leaves, Mr. Jones decides not to have the work done. Instead of using the cancellation form, Mr. Jones sends the contractor a letter by first-class mail stating that he is canceling the contract. Is Mr. Jones' cancellation effective? - CORRECT ANSWER Yes. Mr. Jones' letter does cancel the contract because it indicates his intention not to be bound by the contract.
A contractor usually will not be held liable for a supplier going on strike, but if your supplier did go on strike what would you do? - CORRECT ANSWER Contact the owner immediately.
A contractor, on his own initiative, changed the design of a building and carried out the change. The owner rejected the change and stated that the building has lost market value. If the owner takes the contractor to court and obtains a favorable judgment, the
owner is: - CORRECT ANSWER Due the cost of repairs or the loss of market value.
A contractor's license has expired. How long after the date of expiration does the contractor have to renew the license before it becomes void? - CORRECT ANSWER A contractor has five years after the date of expiration to renew the license before it becomes void.
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.
A licensed contractor contracts with a building owner to do a $900 improvement. When applying for a building permit, the contractor checks the owner-builder box on the declaration form. Which of the following statements is correct?
A.nThe contractor may check the box to avoid insurance charges.
- The contractor should check the box so that the owner-builder verification will be
- / 3
mailed to the owner.