Exam Cheat Sheet · Quick Reference

Idaho Public Works Contractor Exam

Idaho  ·  PSI Services Contractor

Verified, not estimated. Every figure below is drawn from the official exam structure we maintain — question counts, passing standard and topic weighting. Practice questions are grounded in the source law with statute citations. We omit any figure we can't verify rather than guess at it.
Total questions
100
Passing score
70%
Exam time
240 min
Administered by
PSI Services Contractor
Format
Reference materials allowed

Idaho State Portion 100 questions

Contractor's Business and Law Reference Manual Section 1 1 Q · 1%
Components and purpose of a business planBusiness plan executive summary and financial plan elementsChecklist for starting a business in IdahoResearching a new construction businessManagement plan and operations plan contentMarketing plan elements for a contractorSupporting documents for a business planResources for business plan development in Idaho
Contractor's Business and Law Reference Manual Section 2 2 Q · 2%
Business organization types and methods of organizationSteps and checklist for starting a contractor businessSelecting and working with a CPA or LPA accountantSelecting and working with a business attorneySelecting an insurance agent and required business insuranceSelecting a bank and small business banking considerationsBusiness registration requirements with the Secretary of StateEmployer responsibilities including taxes and workers' compensation
Contractor's Business and Law Reference Manual Section 3 2 Q · 2%
Types of business organizations available in Idaho (sole proprietorship, partnership, LLC, corporation)Liability characteristics of each business structureRegistration and filing requirements with the Idaho Secretary of StateDifferences between S Corporation and C Corporation tax treatmentLimited Liability Company formation and naming requirementsForeign business entities registering to operate in IdahoSecurities regulations and Idaho Department of Finance requirementsProfessional service corporations and professional LLCs
Contractor's Business and Law Reference Manual Section 4 2 Q · 2%
DOPL mission and regulatory boards under its jurisdictionLicense qualification requirements and application processConsequences of performing work without a required licenseSelecting and working with a CPA or LPA for business financial servicesSelecting an attorney for business matters and fee structuresSelecting an insurance agent and questions to askSelecting a bank and evaluating banking services for a contractor business
Contractor's Business and Law Reference Manual Section 5 20 Q · 20%
Financial statements: balance sheet, income statement, and cash flow statementAccounting methods: cash vs. accrual and GAAP complianceConstruction revenue recognition: percentage of completion and completed contract methodsFinancial ratios: liquidity, efficiency, leverage, and profitability ratiosDepreciation methods: straight-line, MACRS, and IRS Section 179 deductionCash flow management: positive vs. negative cash flow and cash management principlesBookkeeping process: journals, general ledger, trial balance, and postingEquipment acquisition options: leasing, renting, and purchasing considerations
Contractor's Business and Law Reference Manual Section 6 20 Q · 20%
Federal anti-discrimination laws and protected classes (ADEA, ADA, Title VII, EPA, GINA, Pregnancy Discrimination Act)Employee threshold requirements for federal labor law applicabilityReasonable accommodation and undue hardship under ADA and religious discrimination provisionsFederal wage and hour standards under FLSA (minimum wage, overtime, exemptions, recordkeeping)Federal contractor labor obligations (Davis-Bacon, Copeland Anti-Kickback, CWHSSA, Walsh-Healey, SCA, Executive Order 11246)Idaho-specific employment laws (wage payment requirements, new hire reporting, child labor, minimum wage, recordkeeping)Family and Medical Leave Act (FMLA) eligibility and qualifying leave provisionsRequired workplace poster obligations and penalties for non-compliance
Contractor's Business and Law Reference Manual Section 7 20 Q · 20%
Types of contractor insurance coverage (general liability, builder's risk, automobile, completed operations)Workers' compensation insurance requirements and employer obligations in IdahoUnemployment insurance employer liability and tax reporting requirementsSurety bonds (bid bond, performance bond, payment bond)The Miller Act federal bonding requirements for public works projectsIndependent contractor vs. employee classification for UI tax purposesUnemployment insurance wage reporting, due dates, and penaltiesOwner Controlled Insurance Program and alternate insurance options
Contractor's Business and Law Reference Manual Section 8 7 Q · 7%
Types of bids (open/hard bid vs. closed bid) and competitive bidding processFactors to consider when deciding whether to bid a jobEstimation methods: conceptual, preliminary, and detailed estimatesQuantity survey/takeoff process and units of measurementLabor, materials, and equipment pricing in detailed estimatesGeneral and project overhead costs and contingency/allowance calculationsMarkup, profit calculation, and area modification factorsPlans and specifications components (general conditions, drawings, specifications)
Contractor's Business and Law Reference Manual Section 9 8 Q · 8%
Elements required for a valid contractTypes of construction contracts (lump sum, cost plus, time and materials, etc.)Common parts and components of construction contractsRetention proceeds limits and release requirements under Idaho statuteStatute of Frauds requirements for written agreementsBreach of contract definition and remediesChange orders and additional work provisionsTermination clause conditions and contract legalities
Contractor's Business and Law Reference Manual Section 10 10 Q · 10%
Five phases of project management (initiation, planning, executing, monitoring/controlling, closing)Critical Path Method (CPM) components and calculationsGantt chart construction and schedule dependency interpretationProject scheduling concepts including float/slack time and earliest/latest start datesProject management personnel roles and responsibilities (owner's representative, CM/PM, superintendent, foreman, expediter)Cost control procedures including variance detection, CSI cost codes, and inventory controlQuality control and safety during constructionProject closeout and contract closure procedures
Contractor's Business and Law Reference Manual Section 11 5 Q · 5%
OSHA recordkeeping requirements and exemptions (Forms 300, 300A, 301)Recordable vs. non-recordable work-related injuries and illnessesOSHA reporting requirements for fatalities and multiple hospitalizationsOSHA workplace poster requirements and penalties for non-complianceFederal safety regulations governing construction (Construction Safety Act and OSH Act)OSHA cooperative and voluntary programs (VPP, SHARP, OSHA Challenge, Alliance, Strategic Partnership)OSHA consultation services for employersFinancial impact of workplace safety and health programs on business costs
Contractor's Business and Law Reference Manual Section 12 1 Q · 1%
Idaho sales and use tax obligations for contractorsIncome tax filing requirements by business entity type (sole proprietor, partnership, S corp, corporation, LLC)Independent contractor vs. employee classification using the right-to-control testFederal and Idaho employment tax requirements and withholding formsTax recordkeeping periods and documentation requirementsContractor sales tax exemptions and exempt purchase situationsProperty taxes on real and personal business propertyFederal and Idaho special excise taxes applicable to contractors
Contractor's Business and Law Reference Manual Section 13 2 Q · 2%
Who qualifies to file a mechanic's or materialmen's lien in IdahoLien filing requirements and timeline (90-day filing rule, county recorder, required claim contents)Priority and ranking of lien claimants when proceeds are insufficientDuration of liens and enforcement deadlines (6-month enforcement period)Release of mechanic's lien by posting surety bond (bond form, petition, hearing process)General contractor disclosure requirements for residential property lien noticesClaims against multiple buildings and designation of amountsLien waiver requirements and joint check practices as contractor precautions

Key Distinctions

Accrual Accounting MethodvsCash Accounting Method

Accrual recognizes revenues and expenses when the transaction occurs (GAAP compliant), while cash recognizes them only when payment is made or received (not GAAP compliant and not permitted for corporations with average gross receipts exceeding $5 million).

Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance
Renting EquipmentvsLeasing Equipment

Renting is a short-term arrangement billed by the hour, half day, or day with no early-return fee and maintenance handled by the rental company, while leasing is a longer-term contract.

Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Leasing, Purchasing, or Renting Equipment
Quick Ratio (Acid-Test)vsCurrent Ratio

The quick ratio excludes inventories from current assets before dividing by current liabilities, making it a more conservative liquidity measure than the current ratio.

Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Liquidity Ratios
Named-Peril Builder's Risk InsurancevsAll-Risk Builder's Risk Insurance

Named-peril coverage protects only against losses from specifically listed perils, while all-risk is the more common and broader coverage.

Section 7: Insurance – Builders Risk bullet, Page 65
Lump Sum ContractvsUnit Price Contract

A lump sum contract covers the entire project as one total fixed price, while a unit price contract breaks the project into separately billed sections each with its own cost.

Section 9: Contracts — Lump Sum and Unit Price (Fixed Price) (Page 86)
Percentage of Completion MethodvsCompleted Contract Method

Percentage of completion recognizes revenue and expenses in each accounting period as work progresses (preferred for matching), while the completed contract method defers recognition until the project is finished.

Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Percentage of Completion Method
General PartnervsLimited Partner

A general partner controls the business and is personally liable for partnership debts, while a limited partner contributes capital and shares profits but cannot manage the business and is liable only up to the amount contributed.

Division of Occupational & Professional Licenses Contractor's Business and Law Reference Manual (Idaho), Pages 16-17
Private Sector BiddingvsPublic Works Bidding

Private sector owners are not required to advertise for bids and can choose who bids, while public works projects are required by law to advertise for bids.

Section 8: Estimating & Bidding, Bidding section, Page 79
Balance SheetvsIncome Statement

The balance sheet shows liquidity and overall financial position (Assets = Liabilities + Equity) at a point in time, while the income statement reports only profit or loss activity during a reporting period.

Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Balance Sheet
Independent ContractorvsCovered Employee (Idaho UI)

For Idaho unemployment insurance purposes, a worker is an independent contractor only if free from the employer's direction and control over the manner, method, and mode of work; if the employer directs specific methods, the worker is a covered employee.

Contractor's Business and Law Reference Manual, Section 7: Insurance — Independent Contractor
Experience Rate EmployervsCost Reimbursement Employer (Idaho UI)

Most employers are assigned an experience rate for Idaho UI contributions, while governmental units and Section 501(c)(3) nonprofits may elect to directly reimburse the Idaho Employment Security Fund for actual benefit costs instead.

Contractor's Business and Law Reference Manual, Section 7: Insurance — Cost Reimbursement Employers
Design/Planning PhasevsConstruction Phase

The most important quality decisions—component configurations, material specifications, and functional performance—are made during design and planning, not during construction.

Section 10: Project Management in Construction — Quality Control and Safety during Construction (Page 97)

Key Terms

Independent Contractor Control Test (Idaho UI) Contractor's Business and Law Reference Manual, Section 7: Insurance — Independent Contractor
Under Idaho unemployment insurance law, a worker is not an independent contractor if the employer controls the manner, method, and mode of doing the work; method of payment alone does not determine status.
Cost Reimbursement Option (Idaho UI) Contractor's Business and Law Reference Manual, Section 7: Insurance — Cost Reimbursement Employers
Idaho law allows governmental units and Section 501(c)(3) nonprofits to reimburse the Idaho Employment Security Fund directly for benefit costs instead of being assigned an experience rate.
Separate Records Requirement (Idaho UI) Contractor's Business and Law Reference Manual, Section 7: Insurance — Independent Contractor, recordkeeping
Idaho unemployment insurance rules require employers to keep separate records distinguishing exempt independent contractor wages from covered employment wages; failure to do so results in tax liability on all wages.
Certificate of Assumed Business Name (Idaho) Division of Occupational & Professional Licenses Contractor's Business and Law Reference Manual (Idaho), Page 16
Idaho requires general partnerships that do not operate under the full legal names of each owner to file a Certificate of Assumed Business Name with the Secretary of State.
Foreign LLC Registration (Idaho) Division of Occupational & Professional Licenses Contractor's Business and Law Reference Manual (Idaho), Page 17
An LLC organized in another state must submit an original signed Application for Registration as a Foreign Limited Liability Company plus a duplicate copy to the Idaho Secretary of State before operating in Idaho.
Professional Service Corporation Name Requirements (Idaho) Division of Occupational & Professional Licenses Contractor's Business and Law Reference Manual (Idaho), Page 19
Idaho requires a Professional Service Corporation's name to end with 'Chartered,' 'Professional Association,' 'Professional Corporation,' or the abbreviations 'PA,' 'PC,' or 'Chtd.'
DOPL (Idaho) Division of Occupational & Professional Licenses Contractor's Business and Law Reference Manual, Page 20
The Idaho Division of Occupational and Professional Licenses safeguards citizens through administration of building and construction-related safety and licensure standards and houses seven regulatory boards.
Accrual Method / Matching Principle Section 5: Accounting & Finance, Accrual Method section, Page 24
GAAP-compliant accounting method that recognizes revenues and expenses when the transaction occurs, matching them to the period of benefit rather than when cash is exchanged.
Posting Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Bookkeeping process
The bookkeeping process of transferring totaled journal entries to the general ledger at the end of an accounting period.
Trial Balance Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Bookkeeping process
A bookkeeping step that totals all debit balances and credit balances to confirm they are equal.
Percentage of Completion Formula Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Percentage of Completion Method
Cumulative revenue is calculated as (cost incurred to date ÷ total estimated cost) × contract price, used to recognize revenue proportionally across accounting periods.
Change Order Division of Occupational & Professional Licenses Contractor's Business and Law Reference Manual (Idaho), Page 85-86
A formal document completed when changes in the work occur that differ from the original contract scope, protecting both parties legally.
1099 Form Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Annually checklist
A Statement for Recipients of Miscellaneous Income that must be completed and mailed to each independent contractor who earned more than $600 from the business in the previous year.
IRS Section 179 Deduction Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — IRS Section 179 Deduction
Allows a business to deduct up to $500,000 (2014 limit) for qualifying equipment purchases in the year placed in service, with a $2 million total equipment purchase cap.
Engagement Letter Division of Occupational & Professional Licenses Contractor's Business and Law Reference Manual (Idaho), Page 13
A document signed by an accountant and client before work begins that spells out fees, scope of work, and other details to avoid misunderstandings.
Working Capital Ratio Contractor's Business and Law Reference Manual, Section 5: Accounting & Finance — Working Capital Ratio
A liquidity measure that is healthiest between 1.2 and 2.0; below 1.0 indicates negative working capital, while an excessively high ratio may signal too much idle inventory or cash.

Formulas to Know

Balance Sheet EquationAssets = Liabilities + Equity
Current RatioCurrent Assets ÷ Current Liabilities
Quick Ratio (Acid-Test)(Current Assets − Inventories) ÷ Current Liabilities
Interest Coverage RatioEBIT ÷ Interest Expense (ratio ≤ 1.5 signals questionable ability to meet interest)
Percentage of Completion — Cumulative Revenue(Cost Incurred to Date ÷ Total Estimated Cost) × Contract Price
Cash FlowCash Receipts − Cash Payments (over a given period) OR Net Profit + Depreciation + Depletion + Amortization
Accounts Receivable TurnoverNet Credit Sales ÷ Average Accounts Receivable (high ratio = efficient collections)
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