Florida Business and Finance Exam (Construction Contractors)

Factoring is the outright sale of the receivables to another firm, while financing is a loan with the receivables pledged as security.

Bookkeeping is recording business and financial data in a prescribed manner, while accounting designs the system of records, prepares reports from the recorded data, and reviews/interprets them (accountants direct bookkeepers).

A Difference in Bid guarantee pays the difference between your bid and the next qualified responsible bidder's bid, capped at the stipulated bond amount, whereas the Forfeiture Obligation type forfeits the full stated bond amount.

The closing entry moves the year's income into an equity account called Retained Earnings in a corporation but Previous Years' Earnings in a proprietorship.

Direct labor, material, performance bond premiums and interest on a loan for a specific project are charged directly to the job, while workers' compensation insurance, payroll taxes on direct labor, small tools and interest on general working-capital borrowing relate to jobs in general and must be allocated or carried as overhead.

All long-term assets except land are depreciated to recognize using up of value, but the Improvements classification (e.g., improving leased space) is amortized, spreading the cost over a period such as the lease term.

Non-rigid means of support, tetanus immunizations and draining a blister are first aid, while a device with rigid stays or other systems designed to immobilize a body part is medical treatment for recordkeeping purposes.

A design specification describes quality and quantity of work so the contractor building to it is not at fault for a displeasing result, while a performance specification states criteria the finished system must achieve and shifts design responsibility and risk to the contractor.

Where the work shown on the plans differs from the specifications, courts have held the specifications are the guiding document and take precedence (an RFI should still be submitted).

A refundable security deposit is recorded in an asset account, while the last month's rent paid in advance is a true future expense that is deferred until the lease expires.

Only timing differences (deposits in transit, outstanding checks) and bank errors (e.g., a check cleared $10 over its written amount) adjust the bank side, while returned checks, service charges, automatic loan payments and deposit-slip math errors adjust the checkbook.

Reporting $50,000 or less of taxes in the four-quarter lookback period makes an employer a monthly depositor; more than $50,000 makes it a semiweekly depositor (Wed–Fri paydays due the following Wednesday, Sat–Tue paydays due the following Friday).

A Form 2678 agent performs the employer's tax duties under its own EIN and is jointly liable with the employer, while a payroll service provider or reporting agent is not liable as employer or agent — the employer remains liable.

Employee benefits liability (addable to the CGL) covers errors or omissions in administering group life, health, unemployment or social security plans, such as leaving an employee off the group health plan, while employment practices liability responds to discrimination, hiring, promotion and termination claims.