FCC Estimating, Bidding & Financial Management 5

Question 1

Florida Statute 489 requires licensed contractors to maintain what type of financial records to demonstrate solvency?

Accepted Answer

Business financial statements sufficient to demonstrate fiscal integrity

Answer

F.S. 489 requires contractors to maintain business financial records demonstrating fiscal integrity as a condition of licensure.

Question 2

A payment bond on a Florida public construction project protects:

Accepted Answer

Subcontractors and suppliers who are not paid by the general contractor

Answer

A payment bond guarantees that subcontractors and material suppliers will be paid even if the GC fails to pay them, protecting those without lien rights on public property.

Question 3

What is 'retainage' in a construction contract?

Accepted Answer

A percentage of each progress payment withheld until project completion

Answer

Retainage is a holdback (commonly 5–10%) from each progress payment, released upon substantial completion or final acceptance to ensure the contractor finishes the work.

Question 4

When estimating labor costs, 'labor burden' refers to:

Accepted Answer

Additional employer costs such as FICA, insurance, and benefits on top of base wages

Answer

Labor burden includes payroll taxes (FICA), workers' compensation insurance, unemployment insurance, health benefits, and similar employer-paid costs beyond base wages.

Question 5

A contractor has a backlog of $2.4 million and an average monthly revenue of $200,000. The contractor's backlog represents approximately how many months of work?

Accepted Answer

12 months

Answer

$2,400,000 ÷ $200,000/month = 12 months of work in the backlog.

(FCC) Florida Certified Contractors Practice Test

(FCC) Florida Certified Contractors Practice Test

FCC Estimating, Bidding & Financial Management 5