DMV - Representative Dealer-Specific Regulations Questions and Answers

Question 1

A customer purchases a used vehicle for $15,000 and buys the optional 2-day contract cancellation agreement.
They decide to cancel the contract on the second day.
The dealer has a standard restocking fee of $300.
How much must the dealer refund to the customer if the customer paid $250 for the cancellation option?

Accepted Answer

The full purchase price, sales tax, registration fees, and the trade-in vehicle, but the dealer keeps the $250 option fee.

Answer

The full purchase price and all fees, including the $250 option fee.

Answer

The purchase price minus the $300 restocking fee.

Answer

The purchase price minus the $250 option fee and the $300 restocking fee.

Question 2

A dealer takes a vehicle on consignment from a private party. The vehicle is sold to a customer 15 days after the consignment agreement is signed. According to the California Vehicle Code, what is the maximum time the dealer has to pay the consignor after the date of sale?

Accepted Answer

20 days

Answer

10 days

Answer

15 days

Answer

30 days

Question 3

Which of the following is a specifically prohibited use of special dealer license plates according to California regulations?

Accepted Answer

On a service vehicle used to transport parts for the dealership.

Answer

Towing another vehicle from the dealer's inventory.

Answer

A 3-day test drive by a prospective buyer.

Answer

Delivering a sold vehicle to the buyer's residence.

Question 4

A dealer establishes a branch location to sell vehicles. Which of the following is a requirement for this branch location?

Accepted Answer

It must comply with the same office, display, and signage rules as the main location.

Answer

It must be within a 1,000-foot radius of the main dealership location.

Answer

It must operate under a different business name than the main location.

Answer

It must have its own separate dealer bond.

Question 5

Under the 'Seller's Right to Cancel' clause in a typical retail installment sales contract, a dealer may cancel the sale if they cannot secure financing. Within how many days of the purchase date must the dealer notify the buyer of this cancellation?

Accepted Answer

10 days

Answer

3 days

Answer

7 days

Answer

14 days

Question 6

Regarding business records related to vehicle sales, what is the minimum period a California dealer must retain these documents according to the Automobile Sales and Finance Act?

Accepted Answer

For at least seven years, or the duration of the sales contract, whichever is greater.

Answer

3 years, after which they can be destroyed.

Answer

For 90 days in physical form, then electronically for 5 years.

Answer

4 years, to align with CDTFA record-keeping requirements.