AFSB 152 PRACTICE EXAM PART A
WITH 100% CORRECT ANSWERS 2023
The two main types of construction are heavy and highway construction and - Correct
Answer-The general building trades
Dramatic increase in project size, taking work in new geographical areas, moving into
new types of construction, and lack of management maturity are all factors that can
result in - Correct Answer-Contractor failure
The Miller Act requires a contractor on a federal construction project to post two bonds,
a performance bond and a - Correct Answer-Labor and material payment bond
Contractors would typically be granted relief from bidding mistakes from errors in -
Correct Answer-Mathematical calculation
Profitable construction can be achieved by careful estimating, good construction
practices, and - Correct Answer-Efficient job supervision
Most sureties use the 10 percent rule when underwriting bonds. An explanation from the
contractor is required when - Correct Answer-There is a 10 percent or greater difference
between the first and second bids.
A contractor might finance or refinance equipment or real estate. This financing,
secured by real estate and payable in monthly installments over five to fifteen years, is
called - Correct Answer-A term loan
Which one of the following types of financial statements do sureties prefer with a bond
application? - Correct Answer-Audit
The primary consideration that influences most contractors in electing a tax reporting
method is - Correct Answer-The deferral of income tax payments to the greatest extent
possible.
The analyst's notes taken during the review of the contract status report might include
all of the following, EXCEPT: - Correct Answer-Gross profit (loss) recognition
A financial analyst might check for a management change such as that associated with
a stockholder's death, retirement, resignation, or termination when signaled by - Correct
Answer-A treasury stock transaction
From the analyst's viewpoint, accumulated depreciation or amortization on fixed assets
represents - Correct Answer-A calculated reduction of value from the cost or capitalized
, basis of the assets.
The income statement line-item that is widely recognized as the best measure of the
contractor's success in the principal business activity is - Correct Answer-Income from
operations.
One of the principal areas included in a forecast of financial
conditions and financial results is - Correct Answer-Expected financial performance of
construction contracts and
backlogs.
An essential step for trend analysis and forecasting is - Correct Answer-Formulate an
overall judgment of financial trends.
Supply contracts that surety underwriters do not consider hazardous involve products
that are easily replicated, can be purchased from a variety of sources, and - Correct
Answer-Are short in duration
A claim representative needs the principal's cooperation when
gathering information to process a claim. One problem that could result from an
uncooperative principal is - Correct Answer-Payment of additional attorneys' fees and
expenses to enforce
the surety's rights.
A surety claim representative has many sources of information available. However, the
logical starting point for the claim representative is the - Correct Answer-Surety's
underwriters and their tiles.
The two main sources of construction work in the United States are the federal, state,
and local governme1lts and - Correct Answer-Private business and industry.
In starting the design process, the design professional interviews the client and
measures current and future needs and reviews existing facilities for potential
renovation and ability to handle future growth needs. What is the next step? - Correct
Answer-Professional engineers, architects, and attorneys obtain
required zoning approvals and ensure that plans and
specifications comply with all government regulations.
All of the following are primary functions in a successful construction firm, EXCEPT: -
Correct Answer-Management development
John, a general contractor, produces good cash flow through frontloading. Typically, all
of the following statements are true, EXCEPT: - Correct Answer-Frontloading would
increase John's cash flow in the later
stages of the project.
WITH 100% CORRECT ANSWERS 2023
The two main types of construction are heavy and highway construction and - Correct
Answer-The general building trades
Dramatic increase in project size, taking work in new geographical areas, moving into
new types of construction, and lack of management maturity are all factors that can
result in - Correct Answer-Contractor failure
The Miller Act requires a contractor on a federal construction project to post two bonds,
a performance bond and a - Correct Answer-Labor and material payment bond
Contractors would typically be granted relief from bidding mistakes from errors in -
Correct Answer-Mathematical calculation
Profitable construction can be achieved by careful estimating, good construction
practices, and - Correct Answer-Efficient job supervision
Most sureties use the 10 percent rule when underwriting bonds. An explanation from the
contractor is required when - Correct Answer-There is a 10 percent or greater difference
between the first and second bids.
A contractor might finance or refinance equipment or real estate. This financing,
secured by real estate and payable in monthly installments over five to fifteen years, is
called - Correct Answer-A term loan
Which one of the following types of financial statements do sureties prefer with a bond
application? - Correct Answer-Audit
The primary consideration that influences most contractors in electing a tax reporting
method is - Correct Answer-The deferral of income tax payments to the greatest extent
possible.
The analyst's notes taken during the review of the contract status report might include
all of the following, EXCEPT: - Correct Answer-Gross profit (loss) recognition
A financial analyst might check for a management change such as that associated with
a stockholder's death, retirement, resignation, or termination when signaled by - Correct
Answer-A treasury stock transaction
From the analyst's viewpoint, accumulated depreciation or amortization on fixed assets
represents - Correct Answer-A calculated reduction of value from the cost or capitalized
, basis of the assets.
The income statement line-item that is widely recognized as the best measure of the
contractor's success in the principal business activity is - Correct Answer-Income from
operations.
One of the principal areas included in a forecast of financial
conditions and financial results is - Correct Answer-Expected financial performance of
construction contracts and
backlogs.
An essential step for trend analysis and forecasting is - Correct Answer-Formulate an
overall judgment of financial trends.
Supply contracts that surety underwriters do not consider hazardous involve products
that are easily replicated, can be purchased from a variety of sources, and - Correct
Answer-Are short in duration
A claim representative needs the principal's cooperation when
gathering information to process a claim. One problem that could result from an
uncooperative principal is - Correct Answer-Payment of additional attorneys' fees and
expenses to enforce
the surety's rights.
A surety claim representative has many sources of information available. However, the
logical starting point for the claim representative is the - Correct Answer-Surety's
underwriters and their tiles.
The two main sources of construction work in the United States are the federal, state,
and local governme1lts and - Correct Answer-Private business and industry.
In starting the design process, the design professional interviews the client and
measures current and future needs and reviews existing facilities for potential
renovation and ability to handle future growth needs. What is the next step? - Correct
Answer-Professional engineers, architects, and attorneys obtain
required zoning approvals and ensure that plans and
specifications comply with all government regulations.
All of the following are primary functions in a successful construction firm, EXCEPT: -
Correct Answer-Management development
John, a general contractor, produces good cash flow through frontloading. Typically, all
of the following statements are true, EXCEPT: - Correct Answer-Frontloading would
increase John's cash flow in the later
stages of the project.
