CAC CAC Contract Administration 1 — Questions and Answers
Question 1: What document formally establishes the relationship between an owner and a contractor?
- Construction contract (Correct answer)
- Bid bond
- Notice to proceed
- Certificate of occupancy
Correct answer: Construction contract
A construction contract is the binding legal agreement that defines the scope, price, schedule, and obligations between the owner and contractor.
Question 2: Which AIA contract document is most commonly used for a stipulated sum agreement between owner and contractor?
- AIA A101 (Correct answer)
- AIA B101
- AIA A201
- AIA G702
Correct answer: AIA A101
AIA A101 is the standard form of agreement between owner and contractor for a stipulated (fixed) sum.
Question 3: A Change Order in construction contract administration is used to:
- Modify contract scope, price, or schedule with owner and contractor agreement (Correct answer)
- Document daily construction activity
- Authorize subcontractor payments
- Record punch list items
Correct answer: Modify contract scope, price, or schedule with owner and contractor agreement
A Change Order is a written agreement signed by the owner, architect, and contractor that modifies the contract's scope, cost, or time.
Question 4: What is a Contractor's Schedule of Values used for?
- Allocating contract value to work items for progress payment purposes (Correct answer)
- Listing subcontractor bids
- Tracking material deliveries
- Documenting RFI responses
Correct answer: Allocating contract value to work items for progress payment purposes
A Schedule of Values breaks the contract sum into line items so that progress payments can be calculated proportionally as work is completed.
Question 5: Which document is submitted by the contractor to request periodic payment during construction?
- Application for Payment (AIA G702) (Correct answer)
- Notice to Proceed
- Submittals log
- Punch list
Correct answer: Application for Payment (AIA G702)
AIA G702, the Application and Certificate for Payment, is submitted by the contractor and certified by the architect to authorize owner payments.
Question 6: Retainage in a construction contract refers to:
- A percentage of each payment withheld until project completion (Correct answer)
- The contractor's profit margin
- Money held for warranty repairs
- The architect's fee reserve
Correct answer: A percentage of each payment withheld until project completion
Retainage is a portion (typically 5–10%) withheld from each progress payment to ensure satisfactory project completion.
CAC CAC Contract Administration 1
What document formally establishes the relationship between an owner and a contractor?