The tender preparation stage of estimating begins after... - Correct Answer the architect and owner solicit bids, when the contractors begin their estimating processes
To find clarity on payment bond terms, you can... - Correct Answer consult the applicable and relatively stable case law tha...
AFSB 152 QUESTIONS AND CORRECT ANSWERS
2024
The tender preparation stage of estimating begins after... - Correct Answer the architect and owner
solicit bids, when the contractors begin their estimating processes
To find clarity on payment bond terms, you can... - Correct Answer consult the applicable and relatively
stable case law that does define the terms
A surety needs additional information, such as _____________, to adequately evaluate the work-backlog
risk of granting this bond - Correct Answer the contractor's overall capacity and financial capacity
The Schedule of __________ is one of the most important schedules used by producers and
underwriters when analyzing a contractor's financial statement - Correct Answer construction in
progress
A potential problem a project owner could encounter when using a design/build contractor is that
government requirements may require a seal on the plans from a professional engineer or a registered
architect, and the design/build contractor may not have a designer on staff (T/F) - Correct Answer T
The design/build contractor charges a separate design fee in addition to the construction overhead and
profit (T/F) - Correct Answer F
You can recognize a small companies tax method by looking at their balance sheet (T/F) - Correct Answer
T
Vast majority of small contractors use one method for both tax reporting and financial reporting -
Correct Answer F
Bid bonds may not contain specific penal sums or bond penalties (T/F) - Correct Answer T
Through a sharing clause in a construction contract, the ___________ is responsible for cost overruns,
and the _________ are responsible cost underruns - Correct Answer contractor
,owner and contractor
An obligation of the principal in a bid bond that is not a manuscript bid bond form is that it must... -
Correct Answer furnish performance and payment bonds with an acceptable surety
Hazardous waste bond underwriters can protect the surety from exposure to third-party liability outside
the protection of the bond penalty by... - Correct Answer ensuring that the bond does not require the
surety to finance the principal or to engage a completing contractor
The three tasks that can determine whether the contractor can successfully perform the work are... -
Correct Answer estimating, planning, and managing the work to be performed
So that the underwriter can evaluate the contractor's completed jobs, work programs, and experience,
the principal should provide: - Correct Answer Type, size, and location of work
Largest previous backlog
Profitability
Set-aside programs were developed to... - Correct Answer assist minority-owned, disadvantaged, or
women-owned business enterprises
To escape their obligation to indemnify the surety, the principal and indemnitors must show that... -
Correct Answer any payments the surety made were in bad faith
Under a cooperative underwriting arrangement, it is important that the indemnification be perfected
and enforceable under the laws of the... - Correct Answer parent company's domicile
_______ is a form used in trend analysis and forecasting that provides a basis for comparing the as-given
and as-allowed amounts related to a financial statement - Correct Answer Financial statement analysis
,The responsibility for presenting project plans and specifications from which bidders can readily
determine how the project should be built and its costs is that of the... - Correct Answer owner and the
architect
Items that best characterize the types of statements that interest surety underwriters are... - Correct
Answer balance sheets
income statements
cash flow statements
supporting notes and schedules for the past three to five years, including interim statements for the
current fiscal year and concurrent statements for all indemnitors
_________ best describes the reason for a status inquiry - Correct Answer Soliciting an architect's
comments regarding performance of the work
Surety Bond - Correct Answer a written contract that expresses one party's promise to answer for
another party's failure to do something as promised
Surety - Correct Answer the party (usually an insurer) to a surety bond that guarantees to the obligee
that the principal will fulfill an obligation or perform as required by the underlying contract, permit, or
law
Obligee - Correct Answer the party to a surety bond that receives the surety's guarantee that the
principal will fulfill an obligation or perform as promised
Principal - Correct Answer the party to a surety whose obligation or performance the surety guarantees
Contract bond - Correct Answer a surety bond guaranteeing the fulfillment of obligations under
construction contracts or other types of contracts
, Bid bond - Correct Answer a contract bond guaranteeing that a contractor bidding on a construction or
supply contract will enter into the contract and will provide a performance bond if the bid is accepted
Design/build - Correct Answer a construction method that offers "one-stop shopping" to property
owners for design and construction services
Subcontractor (specialty contractor) - Correct Answer an independent contractor who specializes in a
particular kind of work and who is engaged by a general contractor to perform a particular portion of the
general contractor's contract
Mobilization - Correct Answer the process before construction begins that involves activities to facilitate
a construction process, such as moving equipment and a field office onto the job site and installing
temporary utilities
Critical path method (CPM) - Correct Answer a process that identifies every major element of the
construction project, as well as a time estimate for each element, and assembles these elements into
one master schedule
Punch list - Correct Answer a list of small finishing tasks that must be accomplished for completion
General building contractor - Correct Answer an independent contractor who obtains the primary
contract for a project and either completes all the work or subcontracts portions (or all) of the work to
other independent contractors who specialize in such work
General engineering contractor - Correct Answer a contractor that constructs locks and dams, power
plants, large bridges, sewage and water treatment plants, or similar projects for public and private
owners
Heavy and highway construction - Correct Answer a type of construction used for highways, bridges,
dams, roads, railroad beds, and similar projects
Material supplier - Correct Answer manufacture or distributor that sells materials and equipment
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