ARIZONA CONTRACTORS LICENSE EXAM 140
QUESTIONS & CORRECT ANSWERS LATEST 2025
Number of Employees Required for Workers' Compensation - ANSWER-More than
1 employee
Penalty for Failing to Identify Underground Utilities - ANSWER-Fine up to $5000
for first violation, up to $70000 for subsequent violations
Regulation of Air Pollutants - ANSWER-Clean Air Act
Applicability of Fair Labor Act - ANSWER-Applies to employers with 1 or more
employees
Purpose of Form I-9 - ANSWER-Verify employees' legal immigration status in the
USA
Definition of Project Overhead - ANSWER-Includes items like bonds, temporary
storage, dumpsters, security guards, porter potties; makes up 5-10% of bid
Overview of Clean Water Act - ANSWER-Regulates discharges of pollutants into
US waters
Explanation of Current Liabilities - ANSWER-Liabilities maturing and payable
within 1 year
,Retention Period for Immigration Forms - ANSWER-At least 3 years
Purpose of Maintenance Bond - ANSWER-Guarantees no defective workmanship
or material for one year on completed project
Liability Insurance - ANSWER-To protect against third party claims
Keyman Life Insurance - ANSWER-To ensure business continuity in case of death
or incapacity
Employee Deductions for Workers' Comp - ANSWER-Employees do not pay,
employer covers all costs
Form I-9 Completion Timeframe - ANSWER-Should be completed within 3 days of
hire
Retention Period for Lead Pamphlet Receipt - ANSWER-Must be kept for 3 years
Ownership of Bonds or Cash Deposits - ANSWER-Under the licensee's name
Publication Timing Requirement - ANSWER-Publish within 60 days for 3
consecutive publications
Certification of Project Completion - ANSWER-Done by the architect or engineer
, Progress Payments Definition - ANSWER-Partial payments after completion of
construction phases
Single Prime Method Explanation - ANSWER-Owner hires architect for design,
contractor for work
What is a Payment Bond - ANSWER-Guarantees subcontractors and suppliers will
be paid if they perform properly under the contract
How Long to Keep Tax Records - ANSWER-At least 4 years
What is All Risk Builders Insurance - ANSWER-Covers property owners and
builders for buildings under construction, including machinery, equipment,
materials, supplies, and fixtures
What is Property Insurance - ANSWER-Typically covers business and personal
property when damaged, stolen, or lost
What is Workers' Compensation - ANSWER-Protects employees when they are
injured at work
What is Design and Build - ANSWER-Owner contracts one company to complete
the process from start to finish
What is Company Overhead - ANSWER-Cost of doing business, includes expenses
like office rent, taxes, phone, and accounting fees
QUESTIONS & CORRECT ANSWERS LATEST 2025
Number of Employees Required for Workers' Compensation - ANSWER-More than
1 employee
Penalty for Failing to Identify Underground Utilities - ANSWER-Fine up to $5000
for first violation, up to $70000 for subsequent violations
Regulation of Air Pollutants - ANSWER-Clean Air Act
Applicability of Fair Labor Act - ANSWER-Applies to employers with 1 or more
employees
Purpose of Form I-9 - ANSWER-Verify employees' legal immigration status in the
USA
Definition of Project Overhead - ANSWER-Includes items like bonds, temporary
storage, dumpsters, security guards, porter potties; makes up 5-10% of bid
Overview of Clean Water Act - ANSWER-Regulates discharges of pollutants into
US waters
Explanation of Current Liabilities - ANSWER-Liabilities maturing and payable
within 1 year
,Retention Period for Immigration Forms - ANSWER-At least 3 years
Purpose of Maintenance Bond - ANSWER-Guarantees no defective workmanship
or material for one year on completed project
Liability Insurance - ANSWER-To protect against third party claims
Keyman Life Insurance - ANSWER-To ensure business continuity in case of death
or incapacity
Employee Deductions for Workers' Comp - ANSWER-Employees do not pay,
employer covers all costs
Form I-9 Completion Timeframe - ANSWER-Should be completed within 3 days of
hire
Retention Period for Lead Pamphlet Receipt - ANSWER-Must be kept for 3 years
Ownership of Bonds or Cash Deposits - ANSWER-Under the licensee's name
Publication Timing Requirement - ANSWER-Publish within 60 days for 3
consecutive publications
Certification of Project Completion - ANSWER-Done by the architect or engineer
, Progress Payments Definition - ANSWER-Partial payments after completion of
construction phases
Single Prime Method Explanation - ANSWER-Owner hires architect for design,
contractor for work
What is a Payment Bond - ANSWER-Guarantees subcontractors and suppliers will
be paid if they perform properly under the contract
How Long to Keep Tax Records - ANSWER-At least 4 years
What is All Risk Builders Insurance - ANSWER-Covers property owners and
builders for buildings under construction, including machinery, equipment,
materials, supplies, and fixtures
What is Property Insurance - ANSWER-Typically covers business and personal
property when damaged, stolen, or lost
What is Workers' Compensation - ANSWER-Protects employees when they are
injured at work
What is Design and Build - ANSWER-Owner contracts one company to complete
the process from start to finish
What is Company Overhead - ANSWER-Cost of doing business, includes expenses
like office rent, taxes, phone, and accounting fees
