Licensed Electrical Contractor Business and Law Practices 2

Question 1

A licensed electrical contractor's bond primarily protects against which situation?

Accepted Answer

Financial loss caused by the contractor's failure to complete the work

Answer

Equipment theft from the job site

Answer

Injuries sustained by the contractor's employees

Answer

Damage to the contractor's tools and vehicles

Question 2

Under the Fair Labor Standards Act (FLSA), which employees are generally entitled to overtime pay at 1.5x their regular rate?

Accepted Answer

Non-exempt employees working more than 40 hours per week

Answer

Salaried managers earning over $684/week

Answer

Apprentices working under supervision

Answer

Subcontractors on federal projects

Question 3

Which financial statement shows a company's assets, liabilities, and owner's equity at a specific point in time?

Accepted Answer

Balance sheet

Answer

Income statement

Answer

Cash flow statement

Answer

Accounts receivable ledger

Question 4

When bidding on a public works project in most states, an electrical contractor is required to pay employees at least the:

Accepted Answer

Prevailing wage rate for the trade

Answer

Federal minimum wage

Answer

State minimum wage

Answer

Negotiated union rate regardless of union membership

Question 5

An electrical contractor issues a notice to the property owner stating the contractor intends to file a lien if payment is not received. This is called a:

Accepted Answer

Preliminary notice (pre-lien notice)

Answer

Stop-work notice

Answer

Demand letter

Answer

Lis pendens

Question 6

Which type of insurance covers an electrical contractor if a client claims the contractor's negligent work caused financial harm to the client's business operations?

Accepted Answer

Errors and omissions (professional liability)

Answer

Workers' compensation

Answer

Commercial general liability (CGL)

Answer

Commercial auto insurance

Question 7

A subcontractor agreement should include a clause requiring the subcontractor to:

Accepted Answer

Name the general contractor as an additional insured on the sub's liability policy

Answer

Obtain the general contractor's personal credit card number for purchases

Answer

File all permits in the subcontractor's business name only

Answer

Hire employees directly from the general contractor's workforce