Business Law Questions PDF

**5. What type of insurance should a contractor have to cover losses from theft or fire?** A. Workers Compensation Insurance B. Property Insurance C. General Liability Insurance D. Professional Liability Insurance **3. What is one of the advantages of a partnership?** A. No need for a written...

**5. What type of insurance should a contractor have to cover losses from theft or fire?** A. Workers Compensation Insurance B. Property Insurance C. General Liability Insurance D. Professional Liability Insurance **3. What is one of the advantages of a partnership?** A. No need for a written agreement B. Shared financial resources C. Limited liability D. Tax-free income **What is the main purpose of insurance?** A. To avoid taxes B. To increase profits C. To supplement risk against accidents and theft D. To protect personal assets **What is required to elect S Corporation status?** A. Form 1065 B. Form 1040 C. Form 2553 D. Form 990 **What is the main liability of partners in a partnership?** A. Unlimited liability for debts B. Limited to their investment C. Only liable for their own actions D. Liable only if they signed a contract **What is the required action if a surety bond used to secure a license is canceled?** A. Provide proof of financial responsibility B. The license is automatically renewed C. Reapply for the license D. Pay a fine **21. What is the purpose of a Performance Bond?** A. To ensure the contractor completes the project on time B. To guarantee payment to subcontractors C. To protect the owner from contractor default D. To provide insurance for workers **24. What must an employer do if they have at least one employee for 20 weeks in a year?** A. Pay Workers\' Compensation Insurance B. Pay State and Federal Unemployment Taxes C. File a surety bond D. Obtain a Performance Bond **27. What is the term for when a contractor seeks lower bids from subcontractors who have not bid?** A. Bid Rigging B. Bid Bonding C. Bid Shopping D. Bid Evaluation **What type of estimate is generally prepared by the architect using cost models from previous jobs?** A. Conceptual B. Unit Price C. Detailed D. Square Foot **53. What is the purpose of using analytical reports generated from cost data?** A. To make strategic decisions B. To reduce labor C. To increase costs D. To avoid contracts **65. Which of the following is NOT a responsibility of the project manager?** A. Tracking expenditures B. Preparing budgets C. Bidding D. Scheduling tasks **75. Are minors legally allowed to work for a construction company?** A. No, they are not allowed B. Yes, but certain tasks are prohibited C. Yes, with no restrictions D. Yes, but only during summer **84. Who is considered a non-exempt employee under the FLSA?** A. Managers B. Workers entitled to overtime C. Executives D. Independent contractors **89. What is the Family and Medical Leave Act designed for?** A. Paid sick leave B. Overtime compensation C. Unpaid job-protected leave D. Health insurance benefits **93. How long must an employer keep OSHA records?** A. 5 years B. 3 years C. 1 year D. 30 years **7. What is the maximum penalty for willfully violating OSHA regulations?** A. \$156,259 B. \$10,000 C. \$15,625 D. \$37,500 **98. What type of OSHA inspection is conducted for establishments with high injury rates?** A. Programmed B. Random C. Unprogrammed D. Scheduled **103. What is the fine for failure to comply with regulations concerning lead-based paint?** A. Up to \$15,000 per day B. Up to \$10,000 per day C. Up to \$37,500 per day D. Up to \$50,000 per day **05. What is the formula for determining assets on a balance sheet?** A. Assets = Liabilities + Owner\'s Equity B. Assets = Liabilities - Owner\'s Equity C. Assets = Owner\'s Equity - Liabilities D. Assets = Owner\'s Equity + Liabilities **13. What is the fine for a serious violation of OSHA law?** A. \$15,625 B. \$5,000 C. \$10,000 D. \$20,000 **115. How is gross profit calculated?** A. Add all expenses to income B. Subtract Cost of Goods Sold from Income C. Total income minus all expenses D. Multiply income by the number of goods sold **116. What is the term used to describe all construction costs that cannot be traced to a single project?** A. Direct costs B. Fixed overhead C. Variable overhead D. Indirect costs **119. What is the Debt Ratio?** A. Debt divided by assets B. Total assets divided by total debt C. Total liabilities divided by equity D. Assets divided by liabilities **120. What is the Medicare tax rate?** A. 1.45% B. 1.25% C. 2.0% D. 1.75% **122. What is the completed contract method of accounting primarily used for?** A. Tracking cash flow B. Maximizing deferral of taxes C. Minimizing expenses D. Calculating gross profit **124. What is the formula for Return on Total Assets Ratio?** A. Total assets divided by Net Profit B. Net Profit after taxes divided by Total assets C. Net Profit divided by Total assets D. Total income divided by Total liabilities **127. What is the formula for calculating a Profitability ratio?** A. Total income divided by expenses B. Gross profit divided by total assets C. Net income divided by Revenue D. Net profit divided by total liabilities **What is the maximum annual gross receipts for small contractors using the completed contract method?** A. \$15 million B. \$10 million C. \$5 million D. \$20 million **136. What is the purpose of a mechanics\'/materialmen\'s lien?** A. To secure loans for contractors B. To provide insurance for construction projects C. To attach property to help suppliers and subcontractors collect dues D. To register contractors with the state **141. How many members make up the North Carolina licensing board?** A. 9 Members B. 7 Members C. 5 Members D. 11 Members **143. A lien must be filed within how many days of providing the last labor or materials?** A. 150 days B. 120 days C. 90 days D. 180 days **144. What is the penalty for FUTA taxes that are made 7 days late?** A. 5% B. 10% C. 2% D. 15% **147. What must a foreign corporation obtain before a Contractor License is issued?** A. A business license B. A certificate of authority from the Secretary of State C. A tax identification number D. A surety bond **151. What is the deadline for filing unemployment taxes if you owe over \$500?** A. Annually B. Quarterly C. Monthly D. Biannually **153. What is the maximum amount of retainage an owner may withhold on all public contracts over \$100,000?** A. 3% B. 10% C. 5% D. 15% **154. How many days does a subcontractor have to provide written notice to file a claim against the payment bond after completing their last labor?** A. 90 days B. 30 days C. 60 days D. 120 days **158. What is the maximum amount of retainage on periodic or final payments the owner can withhold for public projects less than \$100,000?** A. 5% B. 1% C. 0% D. 10% **159. How long does a building permit expire if no work has been started?** A. 3 months B. 9 months C. 6 months D. 12 months **160. What is the total amount of work that licensed general contractors can perform on a public building project as per G.S. 87-1.1?** A. 25% B. 10% C. 20% D. 30% **161. What is the maximum amount of retainage an owner can withhold for a subcontractor that has completed acceptable work?** A. .5% B. 1% C. 2% D. 3% **162. Who is responsible for correcting a defect discovered in a new building after it has passed code inspection?** A. The contractor B. The owner C. The inspector D. The architect **163. What is the required action if a subcontractor has not been paid by the prime contractor?** A. Wait for the owner to pay B. File a complaint C. The prime contractor must pay the subcontractor D. Contact the board **164. What is the time frame for a contractor to contest a denied request to withdraw a public bid?** A. 10 days B. 15 days C. 20 days D. 30 days **165. What is the maximum amount of time a payment bond for a state project is active after the last day of labor was performed?** A. 18 months B. 6 months C. 1 year D. 2 years **168. What is the time limit for filing a claim of lien on real property after the last furnishing of labor or materials?** A. 90 days B. 60 days C. 120 days D. 180 days **170. What is the required action for a subcontractor to file a claim against a payment bond?** A. Provide written notice B. Notify the owner C. Contact the prime contractor D. File a lawsuit