Practice Test GeeksC33 - C-33 California Painting Contractor License Practice Test
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Business Financial Flashcards

7 cards from real C33 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 Financial flashcards as text

  1. A California painting contractor is required to keep financial and business records for how long after project completion in case of a CSLB audit?

    Answer: 5 years

    The CSLB requires contractors to maintain project and financial records for at least five years after project completion.

  2. What does the term 'retainage' mean in a California construction payment context?

    Answer: A percentage of each progress payment withheld until project completion

    Retainage is a portion (commonly 5–10%) held back from each progress payment and released after satisfactory project completion.

  3. A painting contractor's bond required by the CSLB primarily protects:

    Answer: Consumers who suffer financial harm from the contractor's actions

    The CSLB contractor's license bond exists to compensate consumers who are financially harmed by a licensed contractor's defective work or fraud.

  4. Which accounting method records income when it is earned and expenses when they are incurred, regardless of when cash changes hands?

    Answer: Accrual basis accounting

    Accrual accounting recognizes revenue when earned and expenses when incurred, providing a more accurate picture of financial performance for larger contractors.

  5. A painting contractor receives payment from a client but uses the funds for personal expenses instead of paying subcontractors. Under California law, this conduct may constitute:

    Answer: Misappropriation of construction funds, subject to criminal charges

    Diverting funds meant for subcontractors to personal use can be prosecuted as misappropriation or theft under California Penal Code, in addition to CSLB disciplinary action.

  6. When a painting contractor calculates 'break-even' for the business, they are determining:

    Answer: The point at which total revenue equals total costs, yielding zero profit

    Break-even is the revenue level at which total costs equal total income, meaning the business neither profits nor loses money.

  7. A sole proprietor C-33 contractor must pay self-employment tax in addition to regular income tax. The self-employment tax rate applied to net self-employment earnings is approximately:

    Answer: 15.3%

    Self-employment tax is 15.3% (12.4% Social Security + 2.9% Medicare) on net self-employment income, covering both the employer and employee shares.