NASCLA BUSINESS LAW EXAM QUESTIONS AND ANSWERS

NASCLA BUSINESS LAW EXAM QUESTIONS AND ANSWERS sole proprietor - Answer- A form of business ownership is least regulated partnership - Answer- Under which form of business organization are all investors fully liable for all debts of the business. S corporation - Answer- owner who is looking for maximum protection from personal liability leaving something out - Answer- worst possible error in estimating source documents - Answer- the paperwork related to purchase order, credit card receipts and so on... Income Statement - Answer- A financial statement that reports a company's revenues and expenses and resulting net income or net loss for a specific period of time. Balance Sheet - Answer- a statement of the assets, liabilities, and capital of a business or other organization at a particular point in time, detailing the balance of income and expenditure over the preceding period. Cash Flow Statement - Answer- A summary that shows total income and spending for a given time period Depreciation - Answer- term use for the method of allocating the cost of an asset over its useful life 168 hours (7 x 24 hours) - Answer- number of hours in a define Fair Labor Standard Acts workweek State Income Tax - Answer- taxes deducted solely from employee's wages Form W-3, Transmittal of Wage and Tax Statements - Answer- A form completed by the employer to verify the number of W-2s and amounts withheld as shown on them. This form is sent to the Social Security Administration data processing center along with copies of each employee's W-2 forms. FUTA (Federal Unemployment Tax Act) - Answer- A payroll or employment tax paid solely by the employer based on the salary, usually around .6% to cover the unemployment insurance (UI) and job service programs, pay one-half of the cost of extended unemployment benefits, and provides for a fund from which states may borrow 4 years - Answer- how long must federal employment tax records must be kept? establish a basis for future estimates - Answer- one useful outcome of job cost analysis is to bonds - Answer- which of the following is NOT a company overhead cost? Project overhead costs - Answer- Can be charged to a specific project Cannot be attributed to labor, materials, or equipment 4-10% the cost of construction EX bonds, equipment storage, project office, security, permits, construction loan - Answer- which of the following is a project overhead cost? allowances - Answer- the amount of money you plan to use for a certain budget category that are not estimated. Unit Price Contract - Answer- A contract in which payment is based on a contractor's quoted price per unit of work performed and the owner's measurement of the total number of such units installed. This method is often used when materials and labor are hard to determine. the supplier must be competitive - Answer- all local contractors should expect their material costs are similar because basis for the bid - Answer- what information do project documents ALWAYS provide? contract - Answer- a binding agreement between two or more persons that is enforceable by law read and understand the contract - Answer- what action is essential before signing a contract? written agreement prevail over oral agreement - Answer- which of the following is an established legal guideline for contract? the standard form of agreement - Answer- which contract document must be sign by both owner and contractor? turnkey contract - Answer- a contract gives the prime contractor responsibility for developing the entire project and these contracts often increase the income and profit potential to the contractor. lump sum contract - Answer- A contract with a fixed total price for a well-defined product or service; also called a fixed-price contract Unit Price Contract - Answer- An agreement that divides a contract into various quantities of work categories for the contractor to perform design and build contract - Answer- similar to the turnkey except the owner may control the land, budget and schedule turnkey contract - Answer- a method of organizing a building project in which a contractor and a designer agree to provide a finished building at an agreed-upon price. Upon completion of the project, all the owner has to do is "turn the key" in the door. Most turnkey projects are built for the Department of Housing and Urban Development (HUD). Contractor responsibility - Answer- responsible for complying with all the state and federal regulations relating to a contracted project. fast track - Answer- Describing a construction procedure in which constru