CA Contractors Law Exam Practice Test 1: Latest 2024 Questions and Answers - Prof. Abraham, Exams of Nursing

Download CA Contractors Law Exam Practice Test 1: Latest 2024 Questions and Answers - Prof. Abraham and more Exams Nursing in PDF only on Docsity! 1 CA CONTRACTORS LAW EXAM PRACTICE TEST 1 ACTUAL EXAM LATEST 2024 QUESTIONS WITH CORRECT VERIFIED ANSWERS (AS PER MARKING SCHEME) Which of the following is a general building contractor NOT allowed to do? A. Perform specialty work only B. Perform carpentry work only C. Perform carpentry and two unrelated specialties D. Perform carpentry and three unrelated specialties --: correct answer :--A. Perform specialty work only An individual may qualify for as many as three separate licenses if they own at least of the equity of each business for which they serve as the qualifying individual. A. 10% B. 20% C. 40% D. 50% --: correct answer :--B. 20% Which of the following does not require a contractor's license? 2 A. An owner/builder that remodels and sells their residence every six months B. Building contracts over $500 5 A. An inactive license must be renewed every four years B. Inactive license will not prevent disciplinary actions against the licensee C. An inactive license still requires a contractor's bond D. A contractor may not conduct business until the license has been reactivated --: correct answer :--C. An inactive license still requires a contractor's bond If Bob is a licensed general builder and Frank is Bob's friend, when is Frank allowed to uses Bob's contractor's license as his own? A. It is never allowed B. If Bob is acting as Frank's agent C. If Frank is acting as Bob's partner D. If Frank is related to Bob by blood --: correct answer :--A. It is never allowed What does SWIFT mean? A. Statewide Investigative Fraud Team B. Trucking company C. Sometimes while inducing fast treatment D. Cleaning product used on most construction projects --: correct answer :-- A. Statewide Investigative Fraud Team A contractor receives a citation from the registrar. How many days 6 does the contractor have to appeal the citation? A. 10 working days B. 15 working days C. 30 working days D. 90 working days --: correct answer :--B. 15 working days 7 Which of the following individuals will be required to pass the qualifying examination to obtain a contractor's license? A. A person who currently is the qualifier on a license who is applying for a new license as a Responsible Managing Employee B. A person who passed the qualifying examination two years ago, but did not ever receive a license C. A person who is listed as a partner on a license for the past four years and has been engaged in that business' construction operations D. A person who was the Responsible Managing Employee for another license three years ago --: correct answer :--C. A person who is listed as a partner on a license for the past four years and has been engaged in that business' construction operations If a contractor is operating as a partnership and obtains a federal tax ID number, to whom should the contractor send the number? A. The Contractors State License Board B. The Employment Development Department C. No one, it is used only when filing the income tax D. All government agencies that the contractor deals with --: correct answer :--A. The Contractors State License Board If the CSLB determines that a contractor committed a serious violation, what is the penalty? 10 qualifying individual? A. 12 hours per week or 51% of the operating time of the business, whichever is less B. 24 hours per week or 65% of the operating time of the business, whichever is less 11 C. 32 hours per week or 80% of the operating time of the business, whichever is less D. 40 hours per week or 100% of the operating time of the business, whichever is less --: correct answer :--C. 32 hours per week or 80% of the operating time of the business, whichever is less Which of the following is not a requirement to renew a license? A. Repeat the open-book asbestos exam B. Return the renewal notice with the appropriate fees C. Be sure the contractor's bond is current and on file with the Contractors State License Board D. Notify the Registrar's office of the name of the worker's compensation insurance company if applicable --: correct answer :--A. Repeat the open- book asbestos exam The CSLB requires licensees to submit name change or address within days. A. 7 B. 14 C. 21 D. 90 --: correct answer :--D. 90 A four-person group obtains a contractor's license as a partnership. After five years one partner, who did not serve as the qualifying 12 individual for the license, disassociates from the partnership. In this situation, which of the following segments is not correct? A. The partner who disassociates form the license may obtain their own individual license without passing the examination B. The remaining partners may file a new application to obtain a new partnership license C. The remaining partners may continue to conduct business using the same license since the qualifying individual is still involved with the business D. The remaining partners may apply for a continuation of the license within 90 days to complete any existing contracts --: correct answer :--C. The remaining partners may continue to conduct business using the same license since the qualifying individual is still involved with the business When is a contractor allowed to inactivate their contractor's license? When is an employee allowed to view their own personnel file? a. never b. when they have a court order c. whenever they wish d. during employee evaluations --: correct answer :--c. when ever they wish As required by the immigration reform act, all employees 15 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? a. The contractor may accept as much as Mrs. Swenson agrees to pay. 16 b. The down payment is limited to $1,000 or 10% of the total price, whichever is less. c. The contractor may require enough of a down payment to cover the total cost of materials, but not labor costs. d. Nothing. The contractor must wait until the work is completed to accept any payment. --: correct answer :--b. The down payment is limited to $1,000 or 10% of the total price, whichever is less. When should you let an attorney see a construction contract? a. Before you let your client see the contract. b. After the contract is prepared, but before you sign it. c. After the building permit is obtained. d. After the contract is signed by you and your client. --: correct answer :--b. After the contract is prepared, but before you sign it. If a sales presentation is made in Spanish, the home solicitation contract: a. must be in Spanish b. may be in English if the writing is plain and simple c. must be co-signed by an English-speaking person if the contract is in English d. must be translated into English and notarized --: correct answer :-- a. must be in Spanish A contractor and a homeowner sign a home solicitation contract. If the owner lawfully cancels the contract, how long does the contractor have to pick up unused materials that were delivered to 17 the owner's property? a. within 24 hours after cancellation b. within 10 days after cancellation c. within 20 days after cancellation d. It's too late. If the materials are delivered to the property before a notice of cancellation is received, the materials become the property of the owner. --: correct answer :--c. within 20 days after cancellation 20 seven days and the other 10 days. If the two tasks can be done simultaneously, for how many days do you schedule the job? a. 7 days b. 13 days c. 15 days d. 20 days. --: correct answer :--b. 13 days For which of the following would you not obtain a short-term loan? a. wages b. bid bond c. job materials d. office rent --: correct answer :--d. office rent As part of the safety training process, contractors' supervisors are required to conduct "toolbox" or "tailgate" safety meetings. How often must these meetings be held? a. daily b. at least once every ten working days c. at least once a month d. at least once a quarter --: correct answer :--b. at least once every ten working days DOSH must investigate a complaint charging a serious violation of health or safety standards within: a. one working day b. two working days c. three working days 21 d. five calendar days --: correct answer :--c. three working days Every employer of or more full- or part-time employees must keep written health and safety records for years. a. 1 ...... 3 b. 7 ....... 4 22 c. 10 ..... 3 d. 11 .... 5 --: correct answer :--d. 11 5 If required safety devices are missing from tools, what should an employee do? a. Notify the contractor, who is responsible for safety. b. Notify the property owner, who is responsible for safety. c. Safety devices are the employee's responsiblility. d. Call Cal/OSHA --: correct answer :--a. notify the contractor, who is responsible for safety. Which would not have to be reported to DOSH immediately or withing 24 hours? a. death from a three-story fall b. drunken crane operator its 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 :--c. car accident in which an employee steps onto a public road, gets hit by a car, and suffers a concussion When purchasing insurance, what is the best way to choose among different companies? a. referral b. cost and converage c. location of the company d. word-of-mouth --: correct answer :--b. cost and coverage 25 negligence in a civil action. Which of the following statements is CORRECT? a. John is not liable for damages in a civil action because the employee is his son. b. John is liable for damages in a civil action and must prove that the injury did not result from his negligence. 26 c. In a civil action, John may use the defense that the injury was the result of the contributory negligence of his son. d. A civil action is not a possibility when the dispute involv --: correct answer :--d. A civil action is not a possiblity when the dispute involves a job-related injury, unless the employer is not insured for workers' compensation. A prime contractor entered into a construction contract with a subcontractor. An employee of the subcontractor was injured, bu unfortunately, the subcontractor had not secured workers' compensation coverage. Which of the following statements best describes the situation, except in cased of fraud? a. The subcontractor is guilty, but the prime contactor is not responsible. b. The prime contractor is guilty, but the subcontractor is not responsible. c. Neither the prime contractor nor the subcontractor are responsible. d. The subcontractor is guilty, but the prime contractor must take responsibility for the injuries. --: correct answer :--d. The subcontractor is guilty, but the prime contractor must take responsibility for the injuries. Your accountant advises you to set up a cost management system. What does this system do? a. It gives a cost history to analyze labor and material costs. b. It shows where profits and losses are. c. It shows costs of materials only. 27 d. It compares what others are charging for subcontracted work. --: correct answer :--a. It gives a cost history to analyze labor and material costs. An employee workd 60 hours in one week. If the hourly wage rate is $12, what are the gross wages? a. $600 b. $840 c. $960 30 b. Board of Equalization c. Internal Revenue Services d. Employment Development Department --: correct answer :--c. Internal Revenue Service An employer remits State income tax and State disability taxes withheld from an employee's wages to what agency? a. Internal Revenue Service b. Employment Development Department c. Franchise Tax Board d. Board of Equalization --: correct answer :--b. Employment Development Department Who pays FICA? a. employer b. employee c. 50% employer and 50% employee d. 90% employer and 10% employee --: correct answer :--c. 50% employer and 50% employee How often are FICA taxes reported and paid? a. weekly b. monthly c. quarterly d. yearly --: correct answer :--c. quarterly Who pays FUTA? a. employer b. employee 31 c. 50% employer and 50% employee d. 90% employer and 10% employee --: correct answer :--a. employer What happens after an employee's taxable wages exceed $7,000? a. After $7,000, the FUTA rate increases. 32 b. After $7,000, the FUTA rate decreases by 50%. c. After $7,000, the employer does not pay FUTA. d. Nothing. FUTA is not subject to a wage limit. --: correct answer :--c. After $7,000, the employer does not pay FUTA. Which of the following may not be deducted from an employee's paycheck? a. SDI b. FICA c. Medicare tax d. workers' compensation insurance premiums --: correct answer :--d. workers' compensation insurance premiums To whom do you report and pay sales tax? a. County Tac Collector b. Internal Revenue Service c. Board of Equalization d. Franchise Tax Board --: correct answer :--d. Board of Equalization How often are you required to pay sales tax? a. monthly b. quarterly c. annually d. It depends on the expected amount of sales tax. --: correct answer :--b. quarterly When balancing the accounts receivable, which of the following would have no effect? 35 d. rechecking the bid before submitting it to the client --: correct answer :-- d. rechecking the bid before submitting it to the client Direct costs are $37,000, overhead is 12%, and profit is 5%. What is the selling price? a. $39,272.47 b. $41,373.45 36 c. $43,383.37 d. $44,578.31 --: correct answer :--d. Sum of overhead and profit percentages = 12% + 5% = 17% Percent of selling price that is direct costs = 100% - 17% = 83% = .83 Selling price = $37,000 / .83 = $44,578.31 Direct costs = 44,578.31 x .83 = $37,000.00 Overhead = 44,578.31 x .12 = $ 5,349.40 Profit = 44,578.31 x .05 = $ 2,228.92 Total = $44,578.32 What is the most likely reason to lose a bid? a. 10% added to profit b. vague specifications c. prices from subs were not exact d. costs of materials were not obtained --: correct answer :--b. vague specifications You are bidding 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? a. Bid on the job as though it were to code. b. Bid on the job as though it were to code, but ask the owner to sign a release of your responsibility. c. Bid on the job with the corrections in mind, and perform the 37 corrections yourself to bring the work up to code. d. Decline to bid on the work. --: correct answer :--d. Decline to bid on the work. After you have read the plans and specifications, what is the next important step in writing a bid? a. Talk to and select subs. b. Walk the job. 40 d. five years --: correct answer :--d. five years Business records must be kept and made available for inspection by the Registrar of Contractors for a period of after completion of a construction project or operation. a. one year b. two years c. three years d. five years --: correct answer :--d. five years Construction or alteration of any building, highway, excavation, or other structure in the State of California requires a contractor's license if the total cost of one or more contracts on the project is: a. $150 or more in labor only b. $200 or more in materials only c. $500 or more in labor and materials d. $500 or more in labor only --: correct answer :--c. $500 or more in labor and materials When should a contractor renew the contractor's license bond? a. the day it expires b. 10 days before it expires c. 30 days before it expires d. within 30 days after it expires --: correct answer :--c. 30 days before it expires Harry and Linda have done business as a licensed partnership. If Linda is a general partner, but not the qualifier, what must she do to get an individual license? 41 a. If Linda was listed as a partner on the liscense and was actively engaged in the business for at least five of the past seven years, she may apply for a license with a waiver of the exam. 42 b. If Linda applies for an individual license, the partnership license must be inactivated. c. Linda is not entitled to apply for an individual license. d. General partners may automatically receive an individual license if the are listed on the partnership license. --: correct answer :--a. If Linda was listed as a partner on the license and was actively engaged in the business for at least five of the past seven years, she may apply for a license with a waiver of the exam. A subcontractor who does not serve a preliminary notice: a. may not sever a stop notice but may file a mechanic's lien b. may not file a mechanic's lien but may serve a stop notice c. loses both stop notice and mechanic's lien rights d. loses nothing because subcontractors are not required to file preliminary notices --: correct answer :--c. loses both stop notice and mechanic's lien rights When an owner signs a receipt for a stop notice, it usually means the owner: a. owes money to the contractor for labor and materials b. recognizes that work will stop in 30 days c. owes the sub money d. recognizes that a lien could be placed on funds --: correct answer :--d. recognizes that a lien could be placed on funds What possible reason would an owner for requiring an unconditional lien release from a subcontractor? 45 before starting work. a. DOSH b. Environmental Protection Agency c. the County Engineer d. the regional Underground Service Alert Notification Center --: correct answer :--d. the regional Underground Service Alert Notification Center 46 Before beginning work, an employer or contractor must inquire whether asbestos is present in any building constructed prior to: a. 1975 b. 1978 c. 1985 d. 1990 --: correct answer :--b. 1978 The supplier of a potentially hazardous product must be able to provide a(n) with that product. a. Material Safety Data Sheet b. Certificate for Use c. Injury Illness and Prevention Program d. Hazard Evaluation System Information Services bulletin --: correct answer :--a. Material Safety Data Sheet Is it legal for a contractor to require employees to take lie detector tests? a. It is not legal for the contractor to require lie detector tests, but it would be legal for a federal, state, or local public agency to require lie detector tests of their employees. b. It is not legal for any employer to require lie detector tests. c. It is only legal for the contractor to require lie detector tests of employees who have criminal records. d. It is legal for the contractor to require lie detector tests, but it would not be legal for a federal, state, or local public agency to do so. --: correct answer :--a. It is not legal for the contractor to require 47 lie detector tests, but it would be legal for a federal, state, or local public agency to require lie detector tests of their employees. Sometimes contracts can prove to be too vague to interpret without disagreement between owner and contractor. Which of the following steps would best prevent such problems? a. Walk the job site with the owner. 50 b. you will do that part of the work yourself c. you may simply submit a name later d. the awarding authority will choose a subcontractor for you --: correct answer :--b. you will do that part of the work yourself A contractor meets Mr. Jones at his home to discuss remodeling. The contractor and Mr. Jones sign a contrat 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? a. No. Mr. Jones did not return the contract with the letter. b. No. Mr. Jones did not sign and return the cancellation form. c. Yes. Mr. Jones' letter does cancel the contract because it indicates his intention not to be bound by the contract. d. No. However, the letter would have cancelled the contract had it been sent by certified or registered mail. --: correct answer :--c. Yes. Mr. Jones' letter does cancel the contract because it indicates his intention not to be bound by the contract. 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? a. No. It would be unethical for the contractor to inform any 51 subcontractor that their bid is substantially lower than the other bids, even if the contractor believes that the subcontractor has made an error. b. Yes. If the contractor believes that the subcontractor has made an error in compiling his bid, the contractor should disclose the amounts of the other 52 subcontractors' bids to the subcontractor, so the subcontractor can determine the extent of his error. c. Yes. If the contractor has reason to believe that the subcontractor has made an error in preparing his bid, the contractor should notify th --: correct answer :--c. 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 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 judgement, the owner is: a. due the cost of repairs or the loss of market value b. due any loss of profits c. entitled to a new building d. due only the loss of market value --: correct answer :--a. due the cost of repairs or the loss of market value Of the following, which document is usually delivered first in a transaction involving a home improvement contract? a. three-day notice of right to cancel b. the contract c. "Notice to Owner" d. 20-day preliminary notice --: correct answer :--c. "Notice to 55 a. notify the owner that a lien has been placed on the property b. notify the owner that the person or firm who sent the notice has improved the property c. make the owner aware of the provisions of the mechanic's lien laws 56 d. waive the contractor's or subcontractor's lien rights --: correct answer :-- b. notify the owner that the person or firm who sent the notice has improved the property A notice of completion must be recorded within: a. 10 days after work is completed b. 10 days after work has ceased c. 30 days after work is completed d. 60 days after work has ceased --: correct answer :--a. 10 days after work is completed A mechanic's lien is a written document that must be signed and verified by the claimant. The first and third steps a contractor should take in filing a lien are listed below: Step 1): Obtain the exact legal description of the property; Step 2): ; Step 3: Find out if the person requesting the work of improvement is the owner. What is Step 2: a. Determine the amount of the lien claim. b. Find out the name of the legal owner of the property as well as the percent of ownership. c. List the attorney representing the contractor. d. List the attorney representing the owner. --: correct answer :--b. Find out the name of the legal owner of the property as well as the percent of ownership. When a notice of completion has been filed, the original contractor has 57 days to record a lien. a. 20 b. 30 c. 60 d. 90 --: correct answer :--c. 60 days 60 b. Yes, if the contractor provides each employee with Form W-2 at the end of the year. c.No, because an employee's wages must be paid by a check with a wage deduction statement attached. d. No, unless the contractor obtains a receipt from each employee showing the amount of gross wages received. --: correct answer :--a. Yes, if the contractor provides each employee with a wage deduction statement semimonthly or at the time of each wage payment. A contractor hires a subcontractor to demolish a concrete wall. Who is responsbile for supplying safety goggles? a. Cal/OSHA b. subcontractor c. property owner d. contractor --: correct answer :--b. subcontractor Some counties have an additional sales tax added to the base rate. Which of the following is a correct statement regarding this additional tax? a. This additional tax does not apply to contractors. b. You do not have to pay this additional tax if your home office is in another county. c. You may pay the additional tax charged in your county if the rate is lower than the county where the materials were purchased. d. You must pay the additional tax in the county where the 61 materials were purchased. --: correct answer :--d. You must pay the additional tax in the county where the materials were purchased. Where is the "Notice of RIght to Cancel" found on a home improvement contract? a. at the top of the page b. near the client signature c. in the middle of the page 62 d. on the back --: correct answer :--b. near the client signature How long does a client have to cancel a contract for repairs that are the result of an event for which a State of Emergency was declared? a. 5 business days b. 5 calendar days c. 7 business days d. 7 calendar days --: correct answer :--c. 7 business days Which of the following is considered a direct cost? a. telephone use by employees b. personal vehicle c. insurance d. payroll tax --: correct answer :--d. payroll tax Which act establishes the rights of workers to organize into unions and negotiate contracts? a. Civil Rights Act of 1964 b. Civil Rights Act of 1972 c. Civil Rights Act of 1984 d. National Labor Relations Act of 1935 --: correct answer :--d. National Labor Relations Act of 1935 When is the last day a customer can cancel a contract that was signed on Friday, December 21st? a. the following Friday 65 correct answer :--4 years How long is the contractorr liable for latent or structural defects --: correct answer :--Latent is an invisible or structural defect liable for up to 10 years Accounts receivable contains --: correct answer :-- Retention 66 Retention usually 10%; it is withheld by the owner from the contract to ensure that the job is done properly and subcontractors are paid. What is considered a fixed cost to a contractor? --: correct answer :- -Office rent What is considered a variable cost to contractors? --: correct answer :- - Construction material If a home solicitation presentation is made in spanish, the contract language must be --: correct answer :--spanish If the employer requires a pre-employement physical exam, who must pay for the exam? --: correct answer :--Employer How often should a contractor renew his license? --: correct answer :--2 years Licenses become void after 5 What is the overtime pay rate after 8hrs of work --: correct answer :-- 1.5. after 12, rate doubles What should be included in the change order form --: correct answer :-- Reason for change What is the benefit of arbitration over legislation --: correct answer :-- Arbitration is cheaper When the total price of the bid is over the contractor must be licensed - -: correct answer :--$500 Where does a contractor/employer obtain a Federal Employer 67 Identifacation Number --: correct answer :--IRS In small claims court --: correct answer :--You cannot be presented by an attorney. If the claim is appealed, you can have an attorney Who publishes the material safety data sheet? --: correct answer :-- Manufacturer 70 If the contractor obtains his contractors license on April 7, 2010 when will the license need to be renewed? --: correct answer :-- April 30 2012 Contract expires 2 years at the end of the month Where would depressiation appear on the balance sheet> --: correct answer :--Fixed assets. Only fixed assets can be depreciated Homeowners have how many days from the date of completion to file a notice of completion --: correct answer :--15 On public projects, the contractor must pay his employees at what rate? --: correct answer :--Regular pay What are fixed costs in the construction business --: correct answer :-- Rent, Managers salary What does the ceiling limit mean in tax --: correct answer :--Max tax that can be imposed What does the occurrence basis cover in liability insurance? --: correct answer :--After the insurance policy has expired, the contractor is still covered Occurrence basis means that as long as you had insurance during the time of the accident, you will be covered, even if the claim was filed after the expiration of the policy If an employee shows up 15 minutes late to work, what is the max amount of time the employer can deduct from wages? --: correct answer :--30 minutes 71 Whats the max amount of time a minor can work on a school day? --: correct answer :--4 hrs It is recommended for a contractor to renew the contractors license bond when? --: correct answer :--30 days before it expires What costs are significant when bidding on public works projects --: correct answer :--wages 72 Where would the mechanics lien be recorded --: correct answer :- -county recorder office What's the difference between fixed costs and overhead costs --: correct answer :--Fixed costs fall under the overhead What is the first step that should be taken if you discover human remains or burial artifacts at any site other than a cemetary --: correct answer :--Stop immediately and contact the county coroner What is the most effective scheduling system --: correct answer :-- Critical path method is the most effective. Calendar planner and bar chart are also applicable When the company ownership has changed, the collective bargaining agreement will be binding or effective for how long? --: correct answer :-- Will be binding until it expires If the area contains more than of asbestos, The contractor must obtain a permit from DOSH --: correct answer :--100 Complaints for non-serious violation must be investigated by DOSH within how many days --: correct answer :--14 Complaints for serious violation must be investigated within how many days? --: correct answer :--3 Emplooyer contractor must pay FUTA deposits how often? --: correct answer :--Quarterly If the customer does not pay his or her invoice on time, what do you do? --: correct answer :--Start charging interest 75 contractors bis has been awarded Listng laws apply to which projects? --: correct answer :--State and local public works projects insolvency --: correct answer :--State of not being able to pay debt Clerical error --: correct answer :--an error comitted by a secretary or assistant, often a distraction from what caused the actual error 4 components of a contract --: correct answer :--offer, acceptance, consideration, legality 76 Consideration --: correct answer :--when both parties give up something of value or performance When can contracts be verbal? --: correct answer :--When theyre below 500 of it is stated the work is done by someone unlicensed. A court will only accept written evidence Which of the following will potentially require a business license? A. The Internal Revenue Service B. The Contractors State License Board C. The Department of Industrial Relations D. Any city or county where the contractor is working --: correct answer :-- D. Any city or county where the contractor is working Which of the following is not a form of advertising? A. Business cards B. Radio ads C. Lunch meets D. Contract proposal --: correct answer :--C. Lunch meets If an employee is injured when the contractor's license was suspended or revoked, then what happens to the contractor? 77 A. The contractor may face a lawsuit for damages B. The contractor will lose his license permanently C. The contractor will be fined $10,000 D. The contractor will have to pay to the injured employee a full pay until he recovers --: correct answer :--A. The contractor may face a lawsuit for damages 80 Which of the following requires a home improvement salesperson registration? A. RMO making outbound calls B. Contractor who negotiates contracts outside of their place of business C. Employee who negotiates a service and repair contract D. RME who goes door-to-door and negotiates contracts --: correct answer :- -C. Employee who negotiates a service and repair contract If a Responsible Managing Employee is fired from a company, how much time does the company get to replace the RME with another qualified individual? A. None B. 10 business days C. 90 days D. 1 year --: correct answer :--C. 90 days Which of the following statements is true regarding a Responsible Managing Employee? A. An RME must have a separate bond issued to accompany the licensee's bond B. An RME may have their own active individual license while qualifying for another active license 81 C. An RME may qualify for up to four separate licenses D. An RME must own at least 10% of each business for which they serve as the qualifying individual --: correct answer :--A. An RME must have a separate bond issued to accompany the licensee's bond When is a licensed contractor subject to disciplinary action? 82 A. When allowing their employees the use of the contractors license B. When allowing an unaffiliated unlicensed person the use of the license C. Signing contracts over $500 with a valid contractor's license D. When selling goods or negotiating contracts outside of the contractor's normal place of business --: correct answer :--B. When allowing an unaffiliated unlicensed person the use of the license What is the simplest way for a contractor to verify that a subcontractor has a valid contractor's license? A. Visit the CSLB website to verify the license status B. Ask for written documentation from the CSLB C. Inspect the pocket card for authenticity D. Contact the subcontractor's insurance company --: correct answer :--A. Visit the CSLB website to verify the license status Which of the following statements about advertising is correct? A. An unlicensed contractor may advertise for jobs after applying for a contractor's license. B. An unlicensed contractor may advertise for jobs if the advertisement states that they are unlicensed. C. A licensed general building or engineering contractor may not advertise as a "general contractor". D. All of the above --: correct answer :--B. An unlicensed 85 contractor filing the claim for damages with the general liability insurance instead of paying for damages If the contractor obtains their contractor's license on April 7, 2010, when will the license need to be renewed? 86 A. By April 1, 2012 B. By April 7, 2012 C. By April 30, 2012 D. By April 30, 2014 --: correct answer :--C. By April 30, 2012 How long does a contractor have to renew their license after the expiration date without retaking the license exam? A. years B. years C. years D. years --: correct answer :--D. years How should a homeowner inform the builder of a claim for damages under a construction defect? A. By sending an email listing the issues B. By submitting a claim in writing, sent using certified mail C. By contacting the local homeowner's association D. By suing the contractor in the court of law --: correct answer :--B. By submitting a claim in writing, sent using certified mail How does a contractor change his or her contractor's license from a sole proprietorship to a corporation? A. Hire an attorney to deal with the CSLB B. Apply for the corporation's own contractor's license 87 C. Update the name with the CSLB once the corporation is opened D. Sent a written notification to the CSLB indicating the new company formation --: correct answer :--B. Apply for the corporation's own contractor's license