Business Operations & Law Flashcards
7 cards from real Master Plumber Exam practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Business Operations & Law flashcards as text
What is the difference between a performance bond and a payment bond on a construction project?
Answer: Performance bonds guarantee project completion; payment bonds ensure subcontractors and suppliers are paid
A performance bond protects the owner if the contractor defaults; a payment bond protects subcontractors and suppliers from nonpayment by the prime contractor.
A journeyman plumber working for a licensed master plumber causes water damage through negligent work. Who bears primary legal liability?
Answer: The master plumber and their company, under the doctrine of respondeat superior
Under respondeat superior, an employer is vicariously liable for the negligent acts of employees performed within the scope of their employment.
A plumbing contractor receives a Notice of Intent to Lien from a material supplier. The contractor should respond by:
Answer: Issuing a joint check to the supplier and subcontractor to ensure payment
Issuing a joint check made out to both the subcontractor and the supplier ensures the supplier is paid directly, preventing the lien from being perfected.
Under most state licensing laws, a master plumber's license is non-transferable. This means:
Answer: The license cannot be used by another person or entity
Non-transferability means the license is personal to the holder and cannot be assigned, leased, or used by another individual or business entity.
A plumbing company employs six full-time workers. Under the Americans with Disabilities Act (ADA), does the company have to make reasonable accommodations for a disabled employee?
Answer: Yes, the ADA applies to employers with 15 or more employees, so this company is exempt
The federal ADA Title I applies to employers with 15 or more employees; however, many states have their own disability laws covering smaller employers.
Which financial statement shows a plumbing company's revenues, expenses, and net profit or loss over a specific period?
Answer: Income statement (profit and loss statement)
The income statement (P&L) summarizes revenues and expenses for a given period, showing whether the business earned a profit or sustained a loss.
A plumbing contractor discovers mid-project that hidden asbestos pipe insulation must be removed before proceeding. What is the correct course of action?
Answer: Notify the owner, stop work in the affected area, and engage a licensed abatement contractor
Asbestos abatement requires licensed professionals under EPA and OSHA regulations; plumbers must stop work, notify the owner, and defer to certified abatement contractors.