CSLB BUSINESS AND LAW CERTIFICATION
EVALUATION EXAMS 2026 EXAM Q AND A
STUDY GUIDE WITH FULL SOLUTION
⩥ Stop notice. Answer: A document given for the purpose of stopping,
intercepting, or freezing funds that have not yet been paid on a
construction project in an attempt to ensure payment.
⩥ What is required to for a stop notice to take effect?. Answer: 20-day
preliminary notice must have been sent in order for a Stop Payment
Notice to take effect.
⩥ What is a Preliminary notice. Answer: A preliminary notice is a
document sent at the beginning of a construction job to inform the GC
and property owner of their work on the project. California requires
subcontractors and suppliers to send preliminary notice in order to
preserve their right to file a mechanics lien if they don't receive
payment.
⩥ What is the purpose of a I-9?. Answer: A new-hire will fill out an I-9
form to verify their employment eligibility status..
⩥ DE-1 forum. Answer:
,⩥ What is a US-99. Answer: A record that an entity or person paid you.
The payer fills out the 1099 form and sends copies to you and the IRS.
There are several kinds of 1099 forms.
⩥ If an employee quits, wages are due within ___ hours.. Answer: 72
⩥ Employment Development Department (EDD). Answer: California
government agency that supports state activities and benefit programs by
collecting and administering employment-related taxes such as
employer-financed unemployment insurance; also provides other
services to employers and employees
⩥ Franchise Tax Board. Answer: CA tax agency that collects and
enforces state income tax assessment and collection. In many situations,
the FTB operates similarly to the IRS.
⩥ Internal Revenue Service (IRS). Answer: Federal agency responsible
for collecting income taxes
⩥ Home-Improvement Contract. Answer: An agreement between the
contractor and homeowner that contains all of the terms of the
improvement project. Must adhere to state laws and spell out each
party's responsibilities in detail.
,⩥ Who does NOT need a California Contractor's State License?.
Answer: Sale or installation of finished products that do not become a
fixed part of the structure.
⩥ When must the prime contractor pay a subcontractor?. Answer: 10-
days after Prime-contractor received payment.
⩥ Prime contractor. Answer: Any contractor on a project who has a
contract directly with the owner.
⩥ sub-contractor. Answer: a person such as a plumber or electrician who
performs one part of the entire construction project
⩥ Contractors Surety Bond. Answer: $12,500.00
⩥ How long will the California Contractors State License Board hold a
contractor responsible for observable defects?. Answer: 4 years
⩥ When must a licensed contractor provide their license number?.
Answer: On all contracts, advertising and 20-Day Preliminary Notices
⩥ Responsible Managing Employee. Answer: Full time employee works
at least 32 hours or 80% of operating time of biz, whichever is less.May
be used to qualify for individual, partnership, or corp license.Never more
than 3 licensees at one time.Can only act as qualifier for 1 license at a
, time unless either: 1) other licensee is subsidiary 2) he/she owns at least
20% of licensee 3) majority of officers/partners of other one also are
those of 1st
⩥ State Disability Insurance is paid by. Answer: Employees only.
⩥ A contractor estimates labor and material costs for a job to be
$2,500.00. Allowing for 15% overhead and an 18% profit, what should
the total bid be?. Answer:
⩥ Who is responsible for determining when the project is complete?.
Answer: The Building Inspector.
⩥ State Board of Equalization.. Answer: Appraises all public utility
properties for tax assessment
⩥ During a declared state of emergency how much may a contractor
increase his/her prices?. Answer: MAYBE NOT CHECK 15% above the
prices just prior to the declared state of emergency
⩥ Contract Bond. Answer: A surety bond guaranteeing the fulfillment of
obligations under construction contracts or other types of contracts
⩥ Responsible Managing Officer (RMO). Answer: The qualifying
individual for a corporation
EVALUATION EXAMS 2026 EXAM Q AND A
STUDY GUIDE WITH FULL SOLUTION
⩥ Stop notice. Answer: A document given for the purpose of stopping,
intercepting, or freezing funds that have not yet been paid on a
construction project in an attempt to ensure payment.
⩥ What is required to for a stop notice to take effect?. Answer: 20-day
preliminary notice must have been sent in order for a Stop Payment
Notice to take effect.
⩥ What is a Preliminary notice. Answer: A preliminary notice is a
document sent at the beginning of a construction job to inform the GC
and property owner of their work on the project. California requires
subcontractors and suppliers to send preliminary notice in order to
preserve their right to file a mechanics lien if they don't receive
payment.
⩥ What is the purpose of a I-9?. Answer: A new-hire will fill out an I-9
form to verify their employment eligibility status..
⩥ DE-1 forum. Answer:
,⩥ What is a US-99. Answer: A record that an entity or person paid you.
The payer fills out the 1099 form and sends copies to you and the IRS.
There are several kinds of 1099 forms.
⩥ If an employee quits, wages are due within ___ hours.. Answer: 72
⩥ Employment Development Department (EDD). Answer: California
government agency that supports state activities and benefit programs by
collecting and administering employment-related taxes such as
employer-financed unemployment insurance; also provides other
services to employers and employees
⩥ Franchise Tax Board. Answer: CA tax agency that collects and
enforces state income tax assessment and collection. In many situations,
the FTB operates similarly to the IRS.
⩥ Internal Revenue Service (IRS). Answer: Federal agency responsible
for collecting income taxes
⩥ Home-Improvement Contract. Answer: An agreement between the
contractor and homeowner that contains all of the terms of the
improvement project. Must adhere to state laws and spell out each
party's responsibilities in detail.
,⩥ Who does NOT need a California Contractor's State License?.
Answer: Sale or installation of finished products that do not become a
fixed part of the structure.
⩥ When must the prime contractor pay a subcontractor?. Answer: 10-
days after Prime-contractor received payment.
⩥ Prime contractor. Answer: Any contractor on a project who has a
contract directly with the owner.
⩥ sub-contractor. Answer: a person such as a plumber or electrician who
performs one part of the entire construction project
⩥ Contractors Surety Bond. Answer: $12,500.00
⩥ How long will the California Contractors State License Board hold a
contractor responsible for observable defects?. Answer: 4 years
⩥ When must a licensed contractor provide their license number?.
Answer: On all contracts, advertising and 20-Day Preliminary Notices
⩥ Responsible Managing Employee. Answer: Full time employee works
at least 32 hours or 80% of operating time of biz, whichever is less.May
be used to qualify for individual, partnership, or corp license.Never more
than 3 licensees at one time.Can only act as qualifier for 1 license at a
, time unless either: 1) other licensee is subsidiary 2) he/she owns at least
20% of licensee 3) majority of officers/partners of other one also are
those of 1st
⩥ State Disability Insurance is paid by. Answer: Employees only.
⩥ A contractor estimates labor and material costs for a job to be
$2,500.00. Allowing for 15% overhead and an 18% profit, what should
the total bid be?. Answer:
⩥ Who is responsible for determining when the project is complete?.
Answer: The Building Inspector.
⩥ State Board of Equalization.. Answer: Appraises all public utility
properties for tax assessment
⩥ During a declared state of emergency how much may a contractor
increase his/her prices?. Answer: MAYBE NOT CHECK 15% above the
prices just prior to the declared state of emergency
⩥ Contract Bond. Answer: A surety bond guaranteeing the fulfillment of
obligations under construction contracts or other types of contracts
⩥ Responsible Managing Officer (RMO). Answer: The qualifying
individual for a corporation
