• 121 questions

California Law and Business Exam Practice Test

Pick one of four answers to see the California code section behind it.

What is the amount of the contractor's bond that an applicant or licensee must have on file?

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Unofficial practice questions, not affiliated with the California Contractors State License Board. Bank checked October 4, 2026.

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What the board's study guide says about the exam

Format
Closed book. Multiple choice, four choices per question. A calculator is provided.
Sections and approximate weights
Business organization and licensing 13%; business finances 15%; employment requirements 20%; insurance and liens 12%; contract requirements and execution 21%; p
Question count and pass mark
Not given in the study guide.
On this page
The code-based parts of all seven sections. Cash management, budgeting, financial reporting, cost control and bidding are not asked.

Checked October 4, 2026 against Contractors State License Board study guide 13E-LAW (03-2026). Rules change, so confirm with the agency itself before your test.

Law and Business Examination study guide (03-2026)

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All 121 questions

Business organization and licensing 23

  • A C-36 plumbing contractor must show the business name, permanent business address and license number on each side of its commercial vehicles. How tall must the letters and numerals be? Cal. Bus. & Prof. Code § 7029.5
  • A corporation qualifies through a responsible managing officer. When is no qualifying individual's bond required? Cal. Bus. & Prof. Code § 7071.9
  • A general building contractor's principal business is with structures whose construction needs how many unrelated building trades or crafts? Cal. Bus. & Prof. Code § 7057
  • A licensed firm commits an act that is cause for discipline. When is its qualifying individual also answerable? Cal. Bus. & Prof. Code § 7122.5
  • A licensee changes its business address. How soon must it notify the registrar in writing? Cal. Bus. & Prof. Code § 7083
  • A licensee's qualifying individual leaves the firm. How soon must the registrar be notified in writing? Cal. Bus. & Prof. Code § 7068.2
  • A person acts as a contractor with no license. What is the heaviest sentence the license law allows the first time? Cal. Bus. & Prof. Code § 7028(b)
  • A person paid an unlicensed contractor for work that needed a license. What may that person sue to recover? Cal. Bus. & Prof. Code § 7031(b)
Show all 121 questions (113 more)

Business organization and licensing, continued

  • A person without a license advertises for construction work that needs one. What fine does the advertising section set? Cal. Bus. & Prof. Code § 7027.1(c)
  • A responsible managing employee must be "actively engaged" in the business. What does the license law mean by that? Cal. Bus. & Prof. Code § 7068(c)
  • An individual licensee dies and a family member wants to finish work in progress. By when must the written request to continue the license reach the board? Cal. Bus. & Prof. Code § 7076
  • For how many firms may one qualifying individual act as the qualifier in any one-year period? Cal. Bus. & Prof. Code § 7068.1(b)
  • How long after a contractor's license runs out can it still be renewed, with no new application needed? Cal. Bus. & Prof. Code § 7141(a)
  • The license law sorts the contracting business into branches. Which of these is one of them? Cal. Bus. & Prof. Code § 7055
  • The minor-work exemption from licensing applies only when no building permit is required and the total price for labor, materials and all other items is below what amount? Cal. Bus. & Prof. Code § 7048(a)
  • On a public works contract, who determines the license classification needed to bid and perform the project? Cal. Bus. & Prof. Code § 7059(b)
  • The registrar cites an unlicensed person for acting as a contractor. What civil penalty range must the citation carry? Cal. Bus. & Prof. Code § 7028.7
  • Two licensed contractors have no joint venture license. What may they lawfully do together before they get one? Cal. Bus. & Prof. Code § 7029.1
  • What is the amount of the contractor's bond that an applicant or licensee must have on file? Cal. Bus. & Prof. Code § 7071.6(a)
  • When does a newly issued contractor's license expire? Cal. Bus. & Prof. Code § 7140
  • Where must a contractor's license be displayed? Cal. Bus. & Prof. Code § 7075
  • Where must a licensee include the license number? Cal. Bus. & Prof. Code § 7030.5
  • Who may not rely on the minor-work exemption, even on a small job? Cal. Bus. & Prof. Code § 7048(c)

Business finances: taxes, payments, records 11

  • A contractor violates the prompt payment rule for subcontractors. What penalty is payable to the subcontractor? Cal. Bus. & Prof. Code § 7108.5(b)
  • A direct contractor on a private job receives a retention payment. How soon must it pay the subcontractors their share? Cal. Civil Code § 8814(a)
  • A prime contractor has a good faith dispute over part of the money due a subcontractor. How much may it withhold? Cal. Bus. & Prof. Code § 7108.5(a)
  • A prime contractor receives a progress payment. Unless otherwise agreed in writing, how soon must it pay its subcontractors their share? Cal. Bus. & Prof. Code § 7108.5(a)
  • A private owner withholds a retention from the direct contractor. When must it be paid? Cal. Civil Code § 8812(a)
  • An applicant with an unsatisfied final judgment must file a bond to cover it. How long after the board's notice does the applicant have? Cal. Bus. & Prof. Code § 7071.17
  • An employer files a withholding report for each calendar quarter. By when is it due? Cal. Unemp. Ins. Code § 13021(a)
  • For how long must a licensee keep its project records available for the registrar's inspection? Cal. Bus. & Prof. Code § 7111
  • Unless otherwise agreed in writing, how soon after a payment demand must a private owner pay the direct contractor an undisputed progress payment? Cal. Civil Code § 8800(a)
  • What must an employer do with state personal income tax on wages paid to an employee? Cal. Unemp. Ins. Code § 13020
  • Which filings does section 1088 of the Unemployment Insurance Code require from an employer? Cal. Unemp. Ins. Code § 1088

Employment requirements 21

  • A business must report an independent contractor (a service-provider) once its payments to that person in a year add up to what amount? Cal. Unemp. Ins. Code § 1088.8
  • A former employee asks to inspect or copy his or her wage statement records. By when must the employer comply? Cal. Labor Code § 226(c)
  • A second meal period must be provided when the work period in a day is longer than how many hours? Cal. Labor Code § 512(a)
  • A worker does work that needs a contractor's license and holds none. What does Labor Code 2750.5 presume about the worker? Cal. Labor Code § 2750.5
  • After how many hours of work in one day does the overtime rate rise to twice the regular rate of pay? Cal. Labor Code § 510(a)
  • An employee gives 72 hours' notice of quitting. When are the final wages due? Cal. Labor Code § 202(a)
  • An employee pays out of pocket for a necessary expense while doing the job as directed. What does Labor Code 2802 require of the employer? Cal. Labor Code § 2802(a)
  • An employee with no written contract for a definite period quits without notice. When are the final wages due? Cal. Labor Code § 202(a)
  • An employee works a seven-hour shift. What meal period must the employer provide? Cal. Labor Code § 512(a)
  • An employee works ten hours in one workday. At what rate must the ninth and tenth hours be paid? Cal. Labor Code § 510(a)
  • An employer discharges an employee. When are the wages earned and unpaid due? Cal. Labor Code § 201(a)
  • An employer willfully fails to pay final wages on time. The employee's wages continue as a penalty for at most how long? Cal. Labor Code § 203(a)
  • At what minimum rate does an employee accrue paid sick days under the accrual method? Cal. Labor Code § 246(b)
  • The equal pay section bars paying employees of one sex less than those of another sex for what kind of work? Cal. Labor Code § 1197.5(a)
  • For how long must an employer keep a copy of each itemized wage statement and the record of deductions? Cal. Labor Code § 226(a)
  • For how long must an employer keep payroll records showing the hours worked daily and the wages paid? Cal. Labor Code § 1174(d)
  • From which day of employment is an employee entitled to use accrued paid sick days? Cal. Labor Code § 246(c)
  • How soon after hiring must an employer report a new employee under section 1088.5? Cal. Unemp. Ins. Code § 1088.5(d)
  • Information in the written notice given to an employee at hiring changes. Unless an exception applies, how soon must the employer notify the employee in writing? Cal. Labor Code § 2810.5(b)
  • On a California itemized wage statement, which digits of the employee's SSN may be shown? Cal. Labor Code § 226(a)
  • Under the twice-a-month payday rule, when must labor performed from the 1st through the 15th of a month be paid? Cal. Labor Code § 204(a)

Insurance and liens 14

  • A limited liability company licensee lists five or fewer persons on its personnel of record. What is the least its liability insurance aggregate limit may be? Cal. Bus. & Prof. Code § 7071.19
  • A stop order halts work because the employer has no workers' compensation coverage. For how much lost time must the employer pay the affected employees? Cal. Labor Code § 3710.1
  • After recording a claim of lien, how long does the claimant have to start an action to enforce it, if no credit is extended? Cal. Civil Code § 8460(a)
  • An employer fails to secure workers' compensation, a misdemeanor. The penalty may reach double the unpaid premium, but the law sets a floor. What is the floor the first time? Cal. Labor Code § 3700.5(a)
  • An employer has not secured workers' compensation and is served with a stop order. When does the order take effect? Cal. Labor Code § 3710.1
  • An owner wants to release property from a recorded claim of lien by recording a bond. How large must the lien release bond be? Cal. Civil Code § 8424
  • Before work begins an owner records the direct contract and a payment bond so that a court must limit lien claims. How large must that bond be? Cal. Civil Code § 8600(a)
  • Besides insuring with an authorized insurer, how may an employer lawfully secure the payment of workers' compensation? Cal. Labor Code § 3700
  • By when must a subcontractor give preliminary notice to keep full lien rights on a private job? Cal. Civil Code § 8204(a)
  • The owner records a notice of completion. How long after that recording does a direct contractor have to record a claim of lien? Cal. Civil Code § 8412
  • The owner records a notice of completion. How long after that recording does a subcontractor have to record a claim of lien? Cal. Civil Code § 8414
  • When may an owner record a notice of completion? Cal. Civil Code § 8182(a)
  • Which claimant on a private work of improvement is not required to give preliminary notice? Cal. Civil Code § 8200(e)
  • With no notice recorded, a continuous stop in labor of what length counts as completion of a private work of improvement? Cal. Civil Code § 8180(a)

Contract requirements and execution 22

  • A "service and repair contract" under section 7159.10 may be for no more than what amount? Cal. Bus. & Prof. Code § 7159.10(a)
  • A change order on a home improvement job is not enforceable against the buyer unless it sets out the scope of the work, the effect on progress payments or the completion date, and what else? Cal. Bus. & Prof. Code § 7159.6
  • A complaint to the registrar about a latent structural defect must be filed within how long after the act? Cal. Bus. & Prof. Code § 7091(b)
  • A complaint to the registrar about a patent act or omission must be filed within how long after the act? Cal. Bus. & Prof. Code § 7091(a)
  • A contractor agrees to build a single-family dwelling that the owner will keep for at least a year. What form must the contract take? Cal. Bus. & Prof. Code § 7164(a)
  • A homeowner has paid for part of the work and asks for protection from liens for that part. What must the contractor furnish on request? Cal. Bus. & Prof. Code § 7159.5
  • A licensed prime contractor signs a subcontract with a contractor who is not licensed. What does section 7118 make of that? Cal. Bus. & Prof. Code § 7118
  • A licensee is cited for contracting with an unlicensed contractor (section 7118). What is the top of the civil penalty range? Cal. Bus. & Prof. Code § 7099.2
  • A licensee walks away from a construction project with no legal excuse. What does section 7107 make of that? Cal. Bus. & Prof. Code § 7107
  • A person sells home improvement contracts for a contractor without being registered as a salesperson. How does section 7153 class that? Cal. Bus. & Prof. Code § 7153(a)
  • Apart from the down payment, how much may a home improvement contractor request or accept at any point in the job? Cal. Bus. & Prof. Code § 7159.5(a)(5)
  • By its definition in section 7151.2, a "home improvement contract" is an agreement in what form? Cal. Bus. & Prof. Code § 7151.2
  • For how many home improvement contractors may a registered home improvement salesperson work? Cal. Bus. & Prof. Code § 7152(c)
  • The home improvement contract rules of section 7159 apply when the total contract price, with all labor, services and materials, is more than what amount? Cal. Bus. & Prof. Code § 7159
  • In the home improvement law, a "senior citizen" is an individual of what age? Cal. Bus. & Prof. Code § 7150(b)
  • In which case does section 7159 not call for the three-day or five-day cancellation notice? Cal. Bus. & Prof. Code § 7159
  • Outside the three sections that carry a higher range, what is the largest civil penalty a citation to a licensee may assess? Cal. Bus. & Prof. Code § 7099.2
  • The Seven-Day Right to Cancel notice gives the buyer how long to cancel the contract? Cal. Bus. & Prof. Code § 7159
  • What is the largest down payment a home improvement contract may ask for? Cal. Bus. & Prof. Code § 7159
  • Which act is a cause for discipline under section 7109? Cal. Bus. & Prof. Code § 7109(a)
  • Which cancellation notice goes in a home improvement contract signed at the home of a buyer who is a senior citizen, with no declared emergency? Cal. Bus. & Prof. Code § 7159
  • Who must have made first contact for a job to qualify as a service and repair contract? Cal. Bus. & Prof. Code § 7159.10(b)

Public works 15

  • A contractor does not produce certified payroll records in the time allowed after a written request. What penalty does it forfeit until it complies? Cal. Labor Code § 1776
  • A contractor on a public work breaks the overtime rules of the public works hours article. What does it forfeit for each worker, for each day of the violation? Cal. Labor Code § 1813
  • A contractor pays workers less than the prevailing wage on a public job. What is the most it forfeits as a penalty? Cal. Labor Code § 1775(a)
  • A direct contractor must give a payment bond before starting a public works contract that involves spending more than what amount? Cal. Civil Code § 9550(a)
  • A local public works contract must carry a clause on differing site conditions when it involves trenches or excavations deeper than what? Cal. Pub. Contract Code § 7104
  • A prime contractor wants to replace a subcontractor listed in its public works bid. Whose consent is needed? Cal. Pub. Contract Code § 4107(a)
  • A prime contractor's bid on a public building must list each subcontractor who will do work worth more than what share of the total bid? Cal. Pub. Contract Code § 4104(a)
  • A worker on a public work puts in more than 8 hours in a day. At what rate must the extra hours be paid? Cal. Labor Code § 1815
  • Before bidding on a public works contract, with which state body must a contractor be registered? Cal. Labor Code § 1725.5
  • How large must a public works payment bond be? Cal. Civil Code § 9554(a)
  • The prevailing wage requirement applies to public works projects above what amount? Cal. Labor Code § 1771
  • What is the lowest ratio of apprentice work to journeyman work allowed on a public works contract covered by the apprentice section? Cal. Labor Code § 1777.5(g)
  • What is the most a public entity may withhold as retention from a payment to the original contractor? Cal. Pub. Contract Code § 7201(b)
  • Where must a copy of the prevailing wage determination be posted on a public works project? Cal. Labor Code § 1773.2
  • Which work is "public works" under the Labor Code's first definition? Cal. Labor Code § 1720(a)(1)

Safety 15

  • A contractor must register with the Division before doing asbestos-related work that involves at least how much asbestos-containing material? Cal. Labor Code § 6501.5
  • A Division permit is needed before building a trench that a person must descend into when the trench is at least how deep? Cal. Labor Code § 6500(a)(1)
  • A Division permit is needed to construct a building or scaffolding taller than what height? Cal. Labor Code § 6500(a)(2)
  • A public works contract over $25,000 includes trenches five feet or more deep. What must the contractor submit before excavation? Cal. Labor Code § 6705
  • An employee complains to the Division about an unsafe condition at work. What does Labor Code 6310 forbid? Cal. Labor Code § 6310(a)
  • An employee is seriously injured on the job. Besides the written report, what must the employer do? Cal. Labor Code § 6409.1(b)
  • An employee's work injury causes lost time beyond the day of injury. How soon must the employer file the report of the injury? Cal. Labor Code § 6409.1(a)
  • An employer receives notice of a safety citation and wants to contest it. How long does it have to notify the appeals board? Cal. Labor Code § 6319
  • Besides describing the violation, what must a safety citation from the Division fix? Cal. Labor Code § 6317
  • How must the employer's system for finding workplace hazards work, under the injury prevention program section? Cal. Labor Code § 6401.7(a)(2)
  • On a multiemployer worksite, which employer does Labor Code 6400 call "the creating employer"? Cal. Labor Code § 6400(b)(2)
  • On a multiemployer worksite, which employer is "the controlling employer"? Cal. Labor Code § 6400(b)(3)
  • What must every employer establish, implement and maintain under Labor Code 6401.7? Cal. Labor Code § 6401.7(a)
  • Where must an employer post a safety citation it has received? Cal. Labor Code § 6408(b)
  • Which of these must an injury prevention program include? Cal. Labor Code § 6401.7(a)(1)

How this list was compiled: California Business and Professions Code (Contractors State License Law, sections 7025 to 7164), Labor Code, Civil Code (sections 8102 to 9554), Public Contract Code and Unemployment Insurance Code, each section on leginfo.legislature.ca.gov, opened and read 2026-10-04. Section map from the Contractors State License Board study guide 13E-LAW (03-2026), https://www.cslb.ca.gov/Resources/StudyGuides/LawStudyGuide.pdf, read 2026-10-04. Licence: Own work. Original questions written from California statutes, which are public law. No question is copied from the license board's examination, study guide or any reference book.

How it works

This unofficial practice test covers only the law part of California's contractor law and business exam. Every question comes from a state code section read on October 4, 2026. Accounting, estimating and bidding questions are not here.

Read the full guide

What this practice test covers

The license board's study guide (edition 03-2026) divides the exam into seven sections, and the Start from menu follows them. Licensing, employment, insurance and liens, contracts, public works and safety are asked from the codes. Cash management, budgeting, financial reporting, cost control and bidding are not asked, because no code section sets them.

What the study guide says about the exam

It is closed book and multiple choice, with four choices per question, and a calculator is provided. The guide gives approximate section weights. It gives no question count or pass mark, so this page shows none.

  • The guide weights contracts and employment highest, at about a fifth of the exam each.
  • After a miss, open the link and read the whole code section.
  • Wrong answers go to Missed until you answer them right.

Questions and answers

Is this the real California law and business exam?

No. It is unofficial practice written from the state codes. The Contractors State License Board writes and gives the real exam, did not write or review this page, and none of its questions appear here.

What does the law and business exam CA contractors take cover?

The board's study guide lists seven sections: business organization and licensing, business finances, employment requirements, insurance and liens, contract requirements and execution, public works, and safety. The guide calls its percentages approximate.

Which parts of the exam are missing from this page?

Cash management, budgeting, financial reporting, cost control and bidding. The guide points to reference books for those, and this page asks only what a California code section states.

Is the exam open book?

No. The study guide, edition 03-2026, says it is a closed-book examination and that no reference materials may be used. A calculator is provided for questions that need arithmetic.

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