CSLB Law and Business: Business Finances
Section 2 of CSLB’s Law and Business study guide · about 15% of the exam
115 questions across every section on the 3½-hour clock, with a score for business finances so you know where you stand.
Free business finances drillA remodeling contractor has many small jobs and frequently waits 60 days or more for customer payments. Which practice most directly improves cash flow without adding debt?
Business Finances on the Law and Business exam
Cash flow, budgets, overhead and markup, depreciation, balance sheets and income statements, financial ratios and business taxes.
- Share of the exam
- About 15% (CSLB study guide); 17 of the 115 questions in our practice exam
- CSLB’s topics
- Cash management · Budget and planning · Taxes · Financial reporting
- Our drill
- 10 questions from 60 business finances questions, untimed, an explanation after every answer; one free attempt, unlimited with a pass
What business finances questions test
- Cash management: cash flow forecasts, working capital, lines of credit and why profitable contractors still run out of cash
- Budget and planning: overhead budgets, break-even volume, markup versus margin, and how overhead gets into a bid
- Taxes: federal and California business and payroll taxes, estimated payments, deposit schedules and which forms report what
- Financial reporting: the balance sheet and income statement, job-cost and general and administrative (G&A) accounts, depreciation, and ratios such as the current ratio, quick ratio and debt-to-equity
- Calculation questions: markup and margin, break-even, depreciation, ratios and simple cash-flow arithmetic
Sit the full exam under the real clock
115 questions across every section on the 3½-hour clock, with a score for business finances so you know where you stand.
Free business finances drillHow to study it
- Learn markup and margin as two formulas and practice converting between them; it is the most common calculation mistake on the exam.
- Know which account every cost goes to: direct job cost, job overhead or company overhead (G&A).
- Do ratio questions with the numbers written out: current assets over current liabilities, and so on. The trap is usually a number from the wrong part of the balance sheet.
Common questions
Is there math on the Law and Business exam?
Yes. CSLB’s study guide says some questions require mathematical computation and that a calculator is provided. The business finances section is where most of it sits: markup and margin, ratios, depreciation and break-even.
Which tax rules does the exam use?
Federal payroll and business tax rules from IRS Publication 15 (Circular E) and California payroll rules from the EDD’s California Employer’s Guide (DE 44), both on CSLB’s resource list. Our calculation questions give the tax rates in the question, as the rates change from year to year.
115 questions across every section on the 3½-hour clock, with a score for business finances so you know where you stand.
Free business finances drillThe other Law and Business sections
Section topics and weight from CSLB study guide: Law and Business (13E-LAW, 03-2026), checked November 2026.
Original independent practice questions written to CSLB’s published study guide outline. Not affiliated with or endorsed by the Contractors State License Board (CSLB) or PSI.