Florida Contractor License Business and Finance Study Guide 1 for 2025/2026 Exam Preparation

Florida Contractor License Business and
Finance Study Guide 1 for 2025/2026 Exam
Preparation

Florida Contractor License Business and Finance Exam
20 Multiple Choice Questions

1. According to Florida Statute 713, a contractor who provides labor or materials to improve real
property has the right to file a:

 A) Mechanic’s Lien

 B) Judgment Lien

 C) Tax Lien

 D) Consensual Lien

Correct Answer: A
Explanation: A mechanic’s lien (also called construction lien) is the legal right of contractors,
subcontractors, and suppliers to claim payment on property they improved.



2. Under Florida’s Construction Lien Law, a “Notice of Commencement” must be recorded before
starting work on:

 A) Any repair under $2,500

 B) New single-family homes only

 C) Any improvements to real property except minor repairs

 D) Public projects

Correct Answer: C
Explanation: A Notice of Commencement is required for most improvements to real property
(excluding minor repairs) and must be recorded before work begins.



3. A general contractor in Florida hires a subcontractor. If the general pays the subcontractor but
the sub does not pay their supplier, who is primarily liable to the supplier?

 A) The property owner

 B) The general contractor

,  C) The subcontractor only

 D) The construction lender

Correct Answer: B
Explanation: The general contractor is ultimately responsible for ensuring all subcontractors and
suppliers are paid. The owner can face a lien if the general fails to manage payments.



4. What is the maximum civil penalty the Florida Construction Industry Licensing Board (CILB) can
impose per violation?

 A) $1,000

 B) $5,000

 C) $10,000

 D) $25,000

Correct Answer: C
Explanation: Per Florida Statute 489.129(2), the CILB may impose an administrative fine of up to
$10,000 per violation.



5. A contractor’s license becomes null and void if it is not renewed within what time after
expiration?

 A) 30 days

 B) 60 days

 C) 90 days

 D) 120 days

Correct Answer: D
Explanation: If a license is not renewed within 120 days after expiration, it becomes null and void,
requiring reapplication.



6. Which type of business entity provides the owner with limited personal liability and is the most
common structure for Florida contractors?

 A) Sole Proprietorship

 B) General Partnership

 C) Limited Liability Company (LLC)