NEVADA CONTRACTORS LICENSE LAW EXAM 2025/2026 | ACCURATE
REAL EXAM QUESTIONS AND ANSWERS WITH VERIFIED RATIONALES
Question 1
After the disassociation of a qualifying employee, how many days does a licensee have to
replace them before the license is automatically suspended?
A) 10 days
B) 30 days
C) 60 days
D) 90 days
E) 180 days
Correct Answer: B) 30 days
Rationale: According to the regulations, a licensee must notify the Board within 10 days of
the disassociation of their qualifier and then has a total of 30 days from the date of
disassociation to replace the qualified individual. Failure to do so results in the automatic
suspension of the license.
Question 2
Which of the following costs would be included in a construction company's overhead?
A) Direct labor on a specific job.
B) Raw materials for a project.
C) Advertising and office rent.
D) Subcontractor payments.
E) Building permit fees for a job.
Correct Answer: C) Advertising and office rent.
Rationale: Company overhead consists of indirect business expenses that are not
chargeable to a particular job. This includes costs like advertising, office utilities,
administrative salaries, and rent, which are necessary for the overall operation of the
business but not for a specific project.
Question 3
For the Nevada State Contractors Board to conduct an official meeting, a quorum must be
present. A quorum consists of how many members of the Board?
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A) 3
B) 4
C) 5
D) 6
E) A simple majority of all members.
Correct Answer: B) 4
Rationale: NRS 624.090 explicitly states that a quorum for transacting business at a Board
meeting shall consist of four (4) members of the Board.
Question 4
If a work-related fatality occurs, how soon must the employer report the death to the nearest
OSHA office?
A) Within 8 hours
B) Within 24 hours
C) Within 48 hours
D) Within 72 hours
E) By the end of the work week.
Correct Answer: A) Within 8 hours
Rationale: OSHA has strict reporting requirements for severe injuries. Any work-related
fatality must be reported to OSHA within 8 hours. In-patient hospitalizations, amputations,
or loss of an eye must be reported within 24 hours.
Question 5
Which financial statement summarizes a company's profit-making activities, including revenues
and expenses, over a specific period of time (such as a month, quarter, or year)?
A) Balance Sheet
B) Statement of Cash Flows
C) Profit and Loss Statement (Income Statement)
D) Statement of Retained Earnings
E) Bank Reconciliation
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Correct Answer: C) Profit and Loss Statement (Income Statement)
Rationale: The Profit and Loss (P&L) or Income Statement is designed to show a
company's financial performance over a period of time. It lists revenues and subtracts the
costs and expenses incurred during that same period to arrive at the net profit or loss.
Question 6
According to NRS 624.600, a general building contractor must provide the owner with a written
statement containing certain information before work begins. Which of the following is NOT
required to be in that statement?
A) The name, license number, and contact information of the contractor.
B) The name and contact information of the Residential Recovery Fund.
C) The names of all individual laborers who will be working on the project.
D) A statement that the contractor is licensed by the Nevada State Contractors Board.
Correct Answer: C) The names of all individual laborers who will be working on the
project.
Rationale: The law requires the contractor to provide their own information, information
about the Board and the Recovery Fund, and contact information for any subcontractors.
However, it does not require a list of the contractor's individual employees or laborers.
Question 7
What is a primary disadvantage of using the cash basis of accounting compared to the accrual
basis?
A) The cash basis is more complex and difficult to maintain.
B) The cash basis does not provide an accurate picture of what has been earned or what is owed.
C) The cash basis is not accepted by the IRS for tax purposes.
D) The cash basis requires more detailed record-keeping.
E) The accrual basis is always less accurate.
Correct Answer: B) The cash basis does not provide an accurate picture of what has been
earned or what is owed.
Rationale: Cash basis accounting only recognizes revenue when cash is received and
expenses when cash is paid out. This can give a misleading picture of profitability. The
accrual basis, which recognizes revenue when earned and expenses when incurred,
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provides a more accurate representation of a company's financial performance during a
specific period.
Question 8
Under the Fair Labor Standards Act (FLSA), a "work week" is defined as a fixed and regularly
recurring period of:
A) 40 hours
B) 80 hours
C) 168 hours
D) 7 calendar days
E) 5 business days
Correct Answer: C) 168 hours
Rationale: The FLSA defines a workweek as a period of 168 consecutive hours, which is
seven consecutive 24-hour periods. It does not have to align with a calendar week but must
be a fixed period.
Question 9
Under federal child labor laws, what is the age range for youths who may be employed in any
nonhazardous job, but for limited hours outside of school time?
A) 12 and 13
B) 14 and 15
C) 16 and 17
D) 18 and 19
E) No youths may be employed.
Correct Answer: B) 14 and 15
Rationale: Youths aged 16 and 17 may be employed for unlimited hours in any
nonhazardous job. The rules for limited hours (no more than 3 hours on a school day, 18 in
a school week, etc.) apply specifically to 14- and 15-year-olds.
Question 10
Violators of the federal child labor provisions are subject to a civil monetary penalty of up to
what amount for each employee who was the subject of a violation?
REAL EXAM QUESTIONS AND ANSWERS WITH VERIFIED RATIONALES
Question 1
After the disassociation of a qualifying employee, how many days does a licensee have to
replace them before the license is automatically suspended?
A) 10 days
B) 30 days
C) 60 days
D) 90 days
E) 180 days
Correct Answer: B) 30 days
Rationale: According to the regulations, a licensee must notify the Board within 10 days of
the disassociation of their qualifier and then has a total of 30 days from the date of
disassociation to replace the qualified individual. Failure to do so results in the automatic
suspension of the license.
Question 2
Which of the following costs would be included in a construction company's overhead?
A) Direct labor on a specific job.
B) Raw materials for a project.
C) Advertising and office rent.
D) Subcontractor payments.
E) Building permit fees for a job.
Correct Answer: C) Advertising and office rent.
Rationale: Company overhead consists of indirect business expenses that are not
chargeable to a particular job. This includes costs like advertising, office utilities,
administrative salaries, and rent, which are necessary for the overall operation of the
business but not for a specific project.
Question 3
For the Nevada State Contractors Board to conduct an official meeting, a quorum must be
present. A quorum consists of how many members of the Board?
,[Type here]
A) 3
B) 4
C) 5
D) 6
E) A simple majority of all members.
Correct Answer: B) 4
Rationale: NRS 624.090 explicitly states that a quorum for transacting business at a Board
meeting shall consist of four (4) members of the Board.
Question 4
If a work-related fatality occurs, how soon must the employer report the death to the nearest
OSHA office?
A) Within 8 hours
B) Within 24 hours
C) Within 48 hours
D) Within 72 hours
E) By the end of the work week.
Correct Answer: A) Within 8 hours
Rationale: OSHA has strict reporting requirements for severe injuries. Any work-related
fatality must be reported to OSHA within 8 hours. In-patient hospitalizations, amputations,
or loss of an eye must be reported within 24 hours.
Question 5
Which financial statement summarizes a company's profit-making activities, including revenues
and expenses, over a specific period of time (such as a month, quarter, or year)?
A) Balance Sheet
B) Statement of Cash Flows
C) Profit and Loss Statement (Income Statement)
D) Statement of Retained Earnings
E) Bank Reconciliation
,[Type here]
Correct Answer: C) Profit and Loss Statement (Income Statement)
Rationale: The Profit and Loss (P&L) or Income Statement is designed to show a
company's financial performance over a period of time. It lists revenues and subtracts the
costs and expenses incurred during that same period to arrive at the net profit or loss.
Question 6
According to NRS 624.600, a general building contractor must provide the owner with a written
statement containing certain information before work begins. Which of the following is NOT
required to be in that statement?
A) The name, license number, and contact information of the contractor.
B) The name and contact information of the Residential Recovery Fund.
C) The names of all individual laborers who will be working on the project.
D) A statement that the contractor is licensed by the Nevada State Contractors Board.
Correct Answer: C) The names of all individual laborers who will be working on the
project.
Rationale: The law requires the contractor to provide their own information, information
about the Board and the Recovery Fund, and contact information for any subcontractors.
However, it does not require a list of the contractor's individual employees or laborers.
Question 7
What is a primary disadvantage of using the cash basis of accounting compared to the accrual
basis?
A) The cash basis is more complex and difficult to maintain.
B) The cash basis does not provide an accurate picture of what has been earned or what is owed.
C) The cash basis is not accepted by the IRS for tax purposes.
D) The cash basis requires more detailed record-keeping.
E) The accrual basis is always less accurate.
Correct Answer: B) The cash basis does not provide an accurate picture of what has been
earned or what is owed.
Rationale: Cash basis accounting only recognizes revenue when cash is received and
expenses when cash is paid out. This can give a misleading picture of profitability. The
accrual basis, which recognizes revenue when earned and expenses when incurred,
, [Type here]
provides a more accurate representation of a company's financial performance during a
specific period.
Question 8
Under the Fair Labor Standards Act (FLSA), a "work week" is defined as a fixed and regularly
recurring period of:
A) 40 hours
B) 80 hours
C) 168 hours
D) 7 calendar days
E) 5 business days
Correct Answer: C) 168 hours
Rationale: The FLSA defines a workweek as a period of 168 consecutive hours, which is
seven consecutive 24-hour periods. It does not have to align with a calendar week but must
be a fixed period.
Question 9
Under federal child labor laws, what is the age range for youths who may be employed in any
nonhazardous job, but for limited hours outside of school time?
A) 12 and 13
B) 14 and 15
C) 16 and 17
D) 18 and 19
E) No youths may be employed.
Correct Answer: B) 14 and 15
Rationale: Youths aged 16 and 17 may be employed for unlimited hours in any
nonhazardous job. The rules for limited hours (no more than 3 hours on a school day, 18 in
a school week, etc.) apply specifically to 14- and 15-year-olds.
Question 10
Violators of the federal child labor provisions are subject to a civil monetary penalty of up to
what amount for each employee who was the subject of a violation?
