WV BUSINESS LAW PRACTICE EXAM FOR
CONTRACTORS
1. What type of contract requires the contractor to be responsible for both the engineering and
construction of a project?
a. Traditional
b. Design build
c. Turn key
d. Concession - Answer- b. Design build
2. By what date is an employer required to provide its employees with a W-2?
a. January 31
b. February 15
c. March 31
d. April 15 - Answer- a. January 31
3. When developing a project schedule, what does WBS stand for?
a. Work breakdown structure
b. Work building schedule
c. Wall board system
d. Whole build system - Answer- a. Work breakdown structure
4. Overtime wages are paid at what percentage of the normal wage rate? - Answer- c. 150%
5. Using the percentage method of withholding, what is the income tax deducted form an
employees wages that earns $1,500 per pay period, is paid bi-weekly, is single and claims no
deductions?
a. $82.95
b. 165.90
c. $194.50
d. $214.50 - Answer- c. $194.50
6. What is the penalty for submitting an IRS payroll tax deposit in the amount of $5,000 that is 2
days late?
a. $100
b. $250
c. $500
d. $750 - Answer- a. $100
The accounting method that recognizes income and expenses only when money is received or
paid is called:
a. the PCM Method
b. the Accrual method
c. the cash method
d. the cost-comparison method - Answer- c. the Cash method
, Employers are required to notify employees of changes in policies affecting all the following
EXCEPT:
a. pay schedules
b vacation allowance
c. health benefits
d. promotion opportunities - Answer- d. promotion opportunities
What is the process for obtaining a contractor license if the existing license has lapsed? (Do not
consider exceptions)
a. Submit a renewal application with the renewal fee.
b. Submit a renewal application, renewal fee and a $25 late fee.
c. Submit a new license application using test scores from original license.
d. Submit a new license application and retake licensing exams. - Answer- d. Submit a new
license application and retake licensing exams.
What does the term "replacement cost" mean relative to insurance coverage?
a. The insurer will pay the policy holder an amount sufficient to cover the acquisition of the same
tool at today's prices.
b. The insurer will pay the policy holder an amount equial to the depreciated value of the tool.
c. The insurer will pay the policy holder an amount sufficient to cover the acquisition of a newer
model tool at today's prices.
d. The insurer will pay the policy holder an amount equal to a negotiated rate for value of a generic
tool. - Answer- a. The insurer will pay the policy holder an amount sufficient to cover the
acquisition of the same tool at today's prices.
All construction projects in West Virginia require a written contract when the total value of the
contract EXCEEDS:
a. $1,500
b. $2,500
c. $10,000
d. $25,000 - Answer- c. $10,000
When estimating the amount of time a task will take to complete, all the following elements should
be considered EXCEPT:
a. production time
b. estimating time
c. setup time
d. contingency time - Answer- b. estimating time
How long are employers required to maintain reportable accident or incident records?
a. 4 years
b. 5 years
c. 6 years
d. 7 years - Answer- b. 5 years
Which of the following would be considered a current liability?
a. Payroll
b. Building lease
c. Equipment loan
d. Stock - Answer- a. Payroll
CONTRACTORS
1. What type of contract requires the contractor to be responsible for both the engineering and
construction of a project?
a. Traditional
b. Design build
c. Turn key
d. Concession - Answer- b. Design build
2. By what date is an employer required to provide its employees with a W-2?
a. January 31
b. February 15
c. March 31
d. April 15 - Answer- a. January 31
3. When developing a project schedule, what does WBS stand for?
a. Work breakdown structure
b. Work building schedule
c. Wall board system
d. Whole build system - Answer- a. Work breakdown structure
4. Overtime wages are paid at what percentage of the normal wage rate? - Answer- c. 150%
5. Using the percentage method of withholding, what is the income tax deducted form an
employees wages that earns $1,500 per pay period, is paid bi-weekly, is single and claims no
deductions?
a. $82.95
b. 165.90
c. $194.50
d. $214.50 - Answer- c. $194.50
6. What is the penalty for submitting an IRS payroll tax deposit in the amount of $5,000 that is 2
days late?
a. $100
b. $250
c. $500
d. $750 - Answer- a. $100
The accounting method that recognizes income and expenses only when money is received or
paid is called:
a. the PCM Method
b. the Accrual method
c. the cash method
d. the cost-comparison method - Answer- c. the Cash method
, Employers are required to notify employees of changes in policies affecting all the following
EXCEPT:
a. pay schedules
b vacation allowance
c. health benefits
d. promotion opportunities - Answer- d. promotion opportunities
What is the process for obtaining a contractor license if the existing license has lapsed? (Do not
consider exceptions)
a. Submit a renewal application with the renewal fee.
b. Submit a renewal application, renewal fee and a $25 late fee.
c. Submit a new license application using test scores from original license.
d. Submit a new license application and retake licensing exams. - Answer- d. Submit a new
license application and retake licensing exams.
What does the term "replacement cost" mean relative to insurance coverage?
a. The insurer will pay the policy holder an amount sufficient to cover the acquisition of the same
tool at today's prices.
b. The insurer will pay the policy holder an amount equial to the depreciated value of the tool.
c. The insurer will pay the policy holder an amount sufficient to cover the acquisition of a newer
model tool at today's prices.
d. The insurer will pay the policy holder an amount equal to a negotiated rate for value of a generic
tool. - Answer- a. The insurer will pay the policy holder an amount sufficient to cover the
acquisition of the same tool at today's prices.
All construction projects in West Virginia require a written contract when the total value of the
contract EXCEEDS:
a. $1,500
b. $2,500
c. $10,000
d. $25,000 - Answer- c. $10,000
When estimating the amount of time a task will take to complete, all the following elements should
be considered EXCEPT:
a. production time
b. estimating time
c. setup time
d. contingency time - Answer- b. estimating time
How long are employers required to maintain reportable accident or incident records?
a. 4 years
b. 5 years
c. 6 years
d. 7 years - Answer- b. 5 years
Which of the following would be considered a current liability?
a. Payroll
b. Building lease
c. Equipment loan
d. Stock - Answer- a. Payroll
