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Business & Finance 65 Question Final Exam

1. According to the Florida Reemployment law , An eligible employee earned an average of

$375.80 per week during the last base period. What will the weekly unemployment payment

be?

A. $178.50

B. $4,481.50

C. $4,881.50

D. $187.75

2. Which of the following would NOT be part of a break-even point calculation?

A. Net Worth

B. Sales

C. Gross Profit

D. Fixed Overhead

3. According to Florida Statute 440, a death of a worker must be reported within __________

A. 24 days

B. 24 hours

C. 8 days

D. 8 Hours

4. A Licensed contractor must notify the Construction Industry Licensing Board of change of

address or name within _________.

A. 15 days

B. 30 days

C. 45 days

D. 60 days

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5. ABC construction has current assets of $250,000, total assets of $300,000, total liabilities

of $65,000 and short term liabilities of $50,000. What is the value of its long term (other)

assets?

A. $50,000 current assets + long term (other) assets = total assets. Total assets – current

assets = long term (other) assets. = $300,000 - $250,000 = $50,000

B. $100,000

C. $150,000

D. $200,000

6. XYZ Construction company has the following financial information available for review:

Short term liabilities $60,000, Short term assets $90,000, Total Liabilities of $100,000, Net

worth of $450,000 with retained earnings of $65,000. Given this information only, the total

assets of the company would be:

A. $90,000

B. $450,000

C. $550,000

D. $650,000

7. Which statement is true concerning a qualifying agent who gives a 2 weeks’ notice of his

intention to leave the company, therefore removing his license from qualifying the company.

A. The company has 30 days to find a new qualifier

B. The qualifier must give 60 days, notice before he can leave

C. An executive of the company can take over only if approved and only to finish

incomplete contracts

D. The business organization has 45 days to notify the board

8. All the following can be accomplished as the result of a good cash budget except:

A. plans for the use of excess funds when they are available B. reconciliation of the bank statement C. preparation for tax liabilities D. cash availability for day to day operations

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9. Regarding the inventory value, individual labeling is done for what cost basis method? A. first in first out B. last in first out C. perpetual inventory D. specific cost

10 The following facts are given about TCI Construction Company’s debt situation:

* Total sales $450,000

* Total credit sales $340,000

* Month’s end receivables account $42,000

* Retainage $55,000

* Actual bad debt losses $5800

The bad debt study, year-to-date ratio is _________.

A. 1 to 78

B. 1 to 49

C. 1 to 59

D. 49to 1

11. According to the Federal Rehabilitation Act of 1973, an aggrieved party must file a complaint of disability discrimination with the Office of Federal Contract Compliance Programs within ________days of the alleged discriminatory act. A. 160 B. 180 C. 365 D. 690

12. If the current ratio is too low, it may be raised by ____________.

A. converting cash to fixed assets B. retaining profits within the business to buy fixed assets C. replacing short-term borrowing with long-term borrowing D. increasing its operating costs

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13. Generally you should write off a bad debt only after exhausting all efforts to collect, but

once a customer has filed bankruptcy further efforts at collecting:

a. Become much easier.

b. Are backed by the government’s efforts.

c. May violate federal law.

d. May constitute harassment.

14. If an employee is hired on March 1 and earns at total of $19,450 for the year. The employer's contribution to Social Security and Medicare would be ______________.

A. Less than $1,000

B. Between $1,000 - $1,200

C. Between $1,200 - $1,400

D. More than $1,400

15. The owner shall, at the request of the bidder to whom award of a contract is under

consideration and no later than _________ days prior to the expiration of the time for

withdrawal of bids, furnish to the bidder reasonable evidence that financial arrangements

have been made to fulfill the owners obligations under the contract.

A. 30

B. 21

C. 14

D. 7

16. A salaried worker earns $32,942.00 per year and is classified as non-exempt under The Fair Standards Act. He works a total of 48 hours during the payroll period from February 13-20, 1998. What is his gross pay for that week? A. $633.50 B. $686.29 C. $739.10 D. $791.60

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17. An employee missed over 7 days of work due to a job related injury, the employee can expect the first benefit payment no later than ______ day after the employer is notified of the injury.

A. the third B. the fourteenth C. the seventh D. the twenty-first

18. Which of the following is a true statement concerning Workers Compensation coverage?

A. Employees can agree to pay a portion of the Workers Compensation premiums, if agreed to in writing.

B. An employer will be obligated to rehire an employee, if the employer has 40 employees.

C. Employers who understate payroll to the carrier can be penalized 15% plus the additional premium

D. An employer who fails to provide the required Workers Compensation may be fined 1.5 times the amount that should have been paid or $1,000, whichever is greater.

19. A notice to owner must be served by a subcontractor before commencing, or not later than ____________ days after commencing furnishing services or materials.

A. 30 B. 45 C. 60 D. 90

20. If within of Substantial Completion, any of the work is found to be defective or not in accordance with the contract documents, the contractor shall correct it promptly after receipt of a written notice from the owner to do so. A. Six months B. One year C. Fifteen months D. Eighteen months

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21. A person who is registered or holds a valid certificate from the board may go on voluntary inactive status on payment of a renewal fee during the inactive period, not to exceed ______________ per renewal period.

A. $10 B. $50 C. $30 D. $40

22. The services of a building contractor are limited to commercial and residential buildings which do not exceed stories in height.

A. 1 1/2 B. 2 C. 2 1/2 D. 3

23. An "independent contractor" reclassified as an employee by the IRS where the company did not provide a 1099 at the end of the year will cost the company at least: A. 40% of FICA, 3% of wages, $100 fine for failing to file 1099 + interest B. 20% of FICA, 1.5% of wages only C. 40% of FICA, and interest only D. 40% of FICA, 3% of wages only

24. According to the Florida Retain I-9 records _____________________.

A. 3 yrs from date of hire / 3 yr after no longer work for you

B. 1 yrs from date of hire / 2 yr after no longer work for you

C. 1 yrs from date of hire / 3 yr after no longer work for you

D. 3 yrs from date of hire / 1 yr after no longer work for you

25 According to the Builder's Guide to Accounting, to find the supplies ratio .

A. divide average inventories of supplies by cost of supplies used B. divide raw materials used by average inventories of raw materials C. divide cost of supplies used by the average inventories of supplies D. use the current market value ratio

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26. Who may sign a notice of contest of claim against a payment bond? A. The contractor B. The contractor's attorney C. The owner D. Both A & B

27. An individual who obtained his license on Nov 1, 2016, would have a requirement to complete _____hour(s) of continuing education before Aug. 31 2018 and would have a requirement to complete 4 hours of building code training education referred to as the ____. A. 0, core B. 14, advanced C. 7, advanced D. 14, core

28. In a contracting company that has more than one qualifying agent, a secondary qualifying agent is responsible for ______________.

A. the supervision of field work at sites where his license was used to obtain building permits B. the supervision of field work at sites where the secondary qualifying agent acts in a supervisory manner C. the financial matters for projects that used his license to obtain building permits D. the financial matters for projects where the secondary qualifying agent acts in a supervisory manner

29. The ______may reject a subcontractor hired by the contractor.

A. Architect

B. Contractor

C. Owner

D. A and C are correct

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30. If a $70,000 loan costs a total of $8,400 including interest, NO points and all fees, the

effective rate of interest when you compare the loan amount against the actual cost of the

loan would be :

A. 12%

B. 13%

C. 14%

D. 15%

31. Which of the following is the correct priority of payment for liens claimed under a direct contract?

A. Liens of the contractor, liens of all persons other than the contractor, liens of all laborers.

B. Liens of the contractor, liens of all laborers, liens of all persons other than the contractor.

C. Liens of all persons other than the contractor, liens of all laborers, liens of the contractor.

D. Liens of all laborer, liens of all persons other than the contractor, liens of the contractor.

32. An alternative to accrual method accounting is the cash method, of which entries are

recorded when.

a. money changes hands

b. invoices are received

c. invoices are posted

d. accounts receivable are billed

33. Which of the following must be true for a person to qualify for a state certification of competency?

A. be a resident of the state of Florida B. be a minimum on 21 years of age C. be of good moral character and submit a financial statement

D. be of good moral character, be at least 18 years of age and pass an examination

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34. 9. Yellow Inc. bought a new school bus for $180,000. After 5 years, the salvage value was

$20,000. How much was depreciated in total for all years? Assume straight line depreciation.

A. $150,000

B. $160,000

C. $170,000

D. $180,000

35. A company has the following financial information available:

Method of revenue recognition is Percentage of Completion

Contract Value Cost to Date Cost to Complete Billings

$1,250,000 $240,000 $800,000 $297,000

Which of the following is TRUE?

A. The total cost of the project is $1,250,000

B. The percentage of completion is 5.2%

C. The project has uncollected earnings of $9,500

D. The project has unearned income of $9,500

36. Fred’s Landscaping bought a new truck for $65,000. Using the straight line depreciation

method with a 5 year lifespan, and zero salvage value.

A. $60,000

B. $65,000

C. $72,000

D. $76,000

37. Construction industry employers who have or more employees are required to have workers compensation insurance.

A. 10 B. 3 C. 2 D. 1

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38. The total amount of lost wages workers compensation insurance will pay depends on the type of disability, but in most instances, an employee will receive __________ of his average weekly wage.

A. 1/4 B. 1/3 C. 1/2 D. 2/3 D

39. A non-exempt employee earns a salary of $350/week on a fluctuating work week and works 50 hours in a particular week, what is his gross pay?

A. $398 B. $415 C. $481 D. $496

40. Which of the following is not exempt from chapter 489?

A. Any employee of a licensee who is a subordinate of such a licensee

B. Owners of property building a two-story residence on such property for the occupancy and use of such owners and not offered for sale C. Owners of property building a commercial building at a cost of $25,000 on such property for the occupancy or use of such owners and not offered for sale or lease D. Any minor work in which the aggregate contract price for labor, materials, and all other items are less than $1,000

41. The breaking strength of 7/8" Dacron rope is _____________.

A. 11,500 B. 10,400 C. 20,050 D. 18,000

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42. Your company has undertaken to construct a 400,000 sq. Ft. warehouse under the AIA 201

Document in Boca Raton Florida. During the course of construction, the owner failed to perform

causing a breach of contract prior to the contract reaching substantial completion. Which of

the following ways is a proper way to calculate the reasonable value for calculating any

general damages?

A. The total contract price less the amount of progress payments and the cost to complete the project.

B. The cost of the work performed plus the anticipated profit less any progress payments made.

C. The contract price multiplied by the percentage of the work completed. D. All of the above

45. Which of the following is NOT true about a 16 year old working in Florida?

A. Such a minor may NOT work on scaffolding B. Such a minor may NOT work more than 6 consecutive days in one school week C. Such a minor may NOT work in a field office D. Such a minor may NOT work after 11:00 pm on a school night

46. The owner's right to carry out work begun by the contractor, but not completed, may

occur after giving the contractor(s) ________ day(s) notice.

A. 1

B. 10

C. 7

D. 12

47. A subcontractor may terminate a subcontract for non-payment of outstanding amounts

due under the subcontract and late for ___________ days.

A. 2

B. 30

C. 60

D. 90

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48. A dispute arises between the prime contractor and owner, which results in the termination of the prime contractor. The status of the subcontractor's contract is: A. Void B. Renegotiable C. Assignable D. Disputable

49. A Company must notify the Construction Industry Licensing Board of a death of a

qualifier within _________.

A. 15 days

B. 30 days

C. 45 days

D. 60 days

50. The owner must prove financial capability no later than days prior to the expiration of

the time for withdrawal of bids.

A. 3

B. 5

C. 7

D. 30

51. What is the basic formula which defines the balance sheet?

a. Assets minus Liabilities equal Net Worth

b. Liabilities minus Net Worth equal Assets

c. Assets equal Liabilities plus Net Worth

d. Liabilities minus Assets = Net Worth

52. According to AIA document A401, the subcontractor’s ability to assign his position as the

subcontractor is

_________________.

A. Not permissible at any time

B. Permissible with the written consent of the contractor

C. May assign the contract only in a bankruptcy situation

D. May not assign the contract unless an approval in writing is received from the architect

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53. TCI was reviewing its financial statement for the year. The following information was

available:

Net Income $150,000

Net Worth $100,000

Total Assets $ 75,000

Short Term Assets $50,000

Total Sales $300,000

Given the information above only, what is the Net worth to Assets Ratio?

A. 1.33 to 1, net worth to assets

B. 1 to 1.33, net worth to assets

C. 2.3 to one, net worth to assets

D. 2.3 to one, assets to net worth

54. Within ____ business days of the date the Contractor becomes aware of an impending

or actual cancellation or expiration of any Contractor’s insurance required by the contact

documents, the Contractor shall provide notice to the owner.

A. 1

B. 2

C. 3

D. 4

55. According to AIA document A-401, within _________days following issuance by the

architect of the certificate for payment covering such substantially completed work, the

contractor shall, to the full extent provided in the contract documents, make payment to the

subcontractor of the entire unpaid balance of the contract sum or of that portion of the

contract sum attributable to the substantially completed work.

A. 10

B. 15

C. 20

D. 30

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56. Direct costs equals: A. Gross profit plus net profit B. Gross profit minus fixed expenses C. Net profit plus overhead expenses D. Gross profit minus net direct expenses

57. Within days after receipt of a written request, or earlier if so required by law, the

Contractor shall furnish to the Subcontractor a copy of any bond covering payment obligations

under the Subcontract Documents or shall authorize a copy to be furnished.

A. 45

B. 30

C. 15

D. 7

58. The owner must prove financial capability no later than _____ days prior to the

expiration of the time for withdrawal of bids.

A. 3

B. 5

C. 7

D. 30

59 . A person may engage in business under a fictitious name by filling out an "Application for Registration of Fictitious Name" and registering the name with the ______________.

A. Department of Business and Professional Regulation B. Division of Corporations C. Department of Commerce

D. Internal Revenue Service

60. With respect to an applicant for a certificate, the initial certification fee and the renewal fee shall not exceed ______________.

A. $350 B. $100 C. $150 D. $200

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61. An active certified residential contractor is eligible to take the general contactors’ examination if he possesses a minimum of years of proven experience in the classification in which he is certified.

A. 1 B. 2 C. 3 D. 4

62.. A properly registered fictitious name is valid for ________________.

A. 1 year B. 2 years C. 3 years D. 5 years

63. Failure of a certificate holder or registrant to apply for renewal of an active certificate at the time of biennial renewal shall cause the certificate to become ___________________.

A. temporarily suspended B. permanently suspended C. voluntarily inactive D. delinquent

64. TCI is reviewing its first year of operations. During this time TCI invested $4,000 in

organizational expenses, including $1,500 in professional fees. The start up fees may be over

several years.

A. Depreciated B. Deferred C. Amortized D. Capitalized

65. According to OSHA 1926, a death of a worker must be reported within __________

A. 24 days

B. 24 hours

C. 8 days

D. 8 hours

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Answer Sheet

1. D Ch. 5, pg.5-53 Contractors Manual

Average Weekly Pay x 13 ÷ 26 = Weekly Benefit. $375.50 x 13 = $4,881.50 $4,881.50 ÷ 26 =

$187.75

2. A Net Worth

3. B 24 hours

4. C 45 days

5. A $50,000 current assets + long term (other) assets = total assets. Total assets –

current assets = long term (other) assets. = $300,000 - $250,000 = $50,000

6. C $550,000 Assets = total Liabilities + Net Worth. $100,000 + $450,000 = $550,000

7 C

8. B Page 173, 174 BGA

9. D Page 120 BGA

10 C BGA pg. 65 $340,000 5800 = 58.6 or 1 to 59

11. B 180 CM(5-40)

12 C Page 174, 175 BGA

13 C Page 63 BGA

14. A $1,487.93

See: Social Security and Medicare Tax

Note: Add the Social Security tax rate (6.2%) with the current Medicare tax rate (1.45%) together. Or, 6.2% + 1.45% = 7.65% $19,450 x 0.0765 (7.65%) = $1,487.93

15. D AIA 6.2

16. B $32,942 ÷ 52 weeks = $663.50, $633.50 ÷ 48 = $13.20 per hour. $13.20 ÷ 2 = $6.60 per overtime hour. $6.60 x 8 = $52.79, $52.79 + $633.50 = $686.29

17. B FS 440.20

18. D FS 440.105

19. B 713.06(2)(a)

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20. B A.I.A. 201 12.2.2.1

21. B FS 489.109

22. D FS 489.105

23. A (2-10)

24. D 3 yrs from date of hire / 1 yr after no longer work for you

25. C p121 BGA

26. D Both A & B CM(9-61)

27. D 14, core FS 489

28. A 489.1195

29. D 5.2.2 A.I.A. 201

30. A 12% ( to find a %, divide the little number by the big number) $8,400 / $70,000 = 12%

31. D FS 713.06(4)(a)

32. A BGA Page 32

33. D FS 489.111

34. B $160,000 180,000 - 20,000 = 160,000 (Cost Basis/Purchase Price – Salvage value =

35. D. The project has unearned income of $9,500 *Cost to Date / Cost to Date + Cost to

Complete = % of completion. % of Completion x contract value = earned income. Compare

earned income with Billings to determine if you have over billed (unearned income) or under

billed. Thus:

$240,000 / ($240,000 + $800,000) = 23%

23% * $1,250,000 = $287,500 (earned income)

$297,000 (Billings) – 287,500 (earnings) = $9,500 unearned income

36. B $65,000 65,000 is Cost Basis or Purchase Price or Depreciable Total $65,000 is all

depreciated.

37. D FS 440.02(17)(b)(2

38. D FS 440.15

39. C Ch. 5 Contractors Manual

$350 ÷ 40 = $8.75 (regular rate) $8.75 x 1.5 = $13.13 (overtime rate); $13.13 x 10 hours = $131.30 $131.30 + $350.00 = $481.30

40. C FS 489.103 Contractors Manual

41. D 7-56 Contractors Manual

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42. D CM 8-20

45. C CM(5-31)

46 B A.I.A. 201 2.5

47. C A.I.A. 401 7.1

48. C A.I.A. 401 7.4.1

49. B 30 days FS 489

50. C A.I.A. 701 6.2

51. C BGA 17, 248

52. B A.I.A. 401 7.4.2

53. A. 1.33 to one, net worth to assets Net worth /Assets; $100,000 / $75,000 = 1.33 to

one ( the first number is always the numerator ( top number ), the second is the

denominator ( bottom number )

54. C A.I.A. 201 11.1.4

55. D A.I.A. 401 11.2

56. D Gross profit minus net direct expenses BGA

57. B A.I.A. 401 3.3.7

58. C A.I.A. 701 6.2

59 . B Chapter 1 FCM

60. D 489.109

61. D (489.111) Contractors Manual

62.. D. Chapter 1 FCM

63. D. 489.116 (4)

64. C Amortized

65. D 8 hours