Florida Certified General Contractor (CGC) — Study Guide

Florida Certified General Contractor (CGC) — Study Guide

Issuing body: Florida Department of Business and Professional Regulation (DBPR), Construction Industry Licensing Board (CILB) Jurisdiction: Florida, United States Level: Professional license (license_to_practice: true — legally mandatory) Prerequisites: 4 years of construction experience (minimum 1 year as foreman/supervisor) OR a relevant degree plus 1 year of supervisory experience; financial responsibility (FICO 660+ or an approved financial-responsibility course); fingerprints/background check; general liability ($300k/$50k minimums per DBPR) and workers' comp insurance; pass the 3-part exam. Renewal: Every 2 years — 14 hours of board-approved continuing education.

1. The legal reality

Florida certified licenses are statewide — a Certified General Contractor can contract anywhere in Florida. (A registered license is local-only, valid just in the issuing jurisdiction — the exam tests this distinction.) Contracting without a license is a first-degree misdemeanor (escalating with repeat offenses), and unlicensed work can't be liened. The CGC scope: construction of any building or structure, unlimited in height/area — the broadest contractor license Florida issues.

2. How the license is earned

1. Document experience (4 years with 1 year supervisory, or degree + 1 year supervisory).
2. Prove financial responsibility: credit report showing FICO 660+ or complete a board-approved financial responsibility course; the CILB scrutinizes bankruptcies and liens.
3. Apply to DBPR; submit fingerprints.
4. Pass three open-book exams at Pearson VUE (books allowed — the exam is a navigation and time-management test):
   • Business & Finance: 120 scored questions, 6.5 hours.
   • Contract Administration: 60 scored questions, 4.5 hours.
   • Project Management: 60 scored questions, 4.5 hours.
   • 70% to pass each part (each part includes unscored pilot questions; per-part sittings are separate — you can pass parts independently).
   • Reference library: ~12–15 books (Florida Building Code, OSHA 29 CFR 1926, Florida Lien Law Ch. 713, Walker's Building Estimator's Reference, Florida Contractor's Manual, AIA documents, accounting references). (Counts per prep-provider summaries of the DBPR reference list — verify the current list at myfloridalicense.com before buying books.)
5. Activate with liability + workers' comp insurance; renew biennially with 14 CE hours.

Exam strategy: open-book does not mean easy — it means tabbed and highlighted. The Business & Finance part has the highest failure rate (accounting under time pressure). Pre-tab every book by exam section, practice lookup drills, and never spend more than ~3 minutes on a lookup question — flag and move on. The math (financial ratios, depreciation, estimating) must be done without hunting for formulas.

3. Knowledge domains

3.1 Business & Finance (the highest-failure part)

• Financial statements: balance sheet (assets = liabilities + equity), income statement, statement of cash flows. Working capital = current assets − current liabilities; current ratio = CA/CL (healthy ≥ ~1.5–2.0 for contractors — the exam's benchmark); debt-to-equity; gross profit = revenue − direct costs; net profit margin.
• Job costing and accounting methods: completed-contract vs. percentage-of-completion (revenue recognized by % complete — the exam tests the computation: recognized revenue = contract price × % complete; over/underbillings = billings vs. recognized revenue).
• Depreciation: straight-line (cost − salvage)/life; the exam's favorite is MACRS/Section 179 awareness (know they exist and accelerate deductions — detailed tables aren't tested).
• Business organization: sole proprietorship, partnership, LLC, S-corp, C-corp — liability, taxation, and licensing implications (the license attaches to the qualifying agent; the exam tests what happens when the qualifier leaves).
• Bidding and markup: direct costs + overhead + profit; bid shopping ethics; unbalanced bidding.
• Tax basics: federal withholding (Circular E), Florida sales tax on materials, unemployment tax.

3.2 Contract Administration

• Florida Lien Law (Chapter 713): the exam's legal core. Notice to Owner (NTO) — must be served within 45 days of first furnishing (the number the exam tests relentlessly); Claim of Lien recorded within 90 days of final furnishing; suit to foreclose within 1 year of recording. Lienor classes (those in privity vs. not — NTO required when not in direct contract with the owner). Lien waivers/releases, contractor's final affidavit, owner's notice of contest of lien (shortens the foreclosure window to 60 days).
• Contract types and AIA documents: A101 (lump sum owner-contractor), A201 (general conditions), B101 (owner-architect); change orders, construction change directives, claims notice requirements.
• Project delivery and bonds: bid/performance/payment bonds; Florida's Little Miller Act (public works over $200,000 — threshold per FL statute § 255.05; verify current figure) requiring payment/performance bonds.
• DBPR regulations: qualifying agents, supervision requirements, financial responsibility, disciplinary grounds.

3.3 Project Management

• Scheduling: CPM (forward/backward pass, float — same mechanics as the CCM guide, tested at application level), bar charts, look-ahead schedules, submittal/procurement logs.
• Estimating: quantity takeoffs, unit pricing, Walker's factors; contingency and allowances.
• Safety (OSHA 1926): the exam pulls heavily from the 1926 reference — fall protection (6' trigger in construction), scaffolds, excavations (5' protective systems), cranes, electrical, PPE. Competent-person duties.
• Florida Building Code: occupancy, wind-load provisions (Florida's hurricane regime — the exam tests wind-borne debris region awareness, uplift connections, and flood-zone basics), energy code.
• Plans and specs reading: symbols, scales, sections/details, spec divisions (MasterFormat).

4. Key numbers (Florida-specific — memorize)

5. Worked examples

Example 1 — Percentage of completion. Contract $1,000,000; costs incurred $400,000; total estimated cost $800,000. % complete = 400,000/800,000 = 50%. Recognized revenue = $500,000. Billings to date $450,000 → underbilling (costs+profit in excess of billings) of $50,000 — an asset, and a cash-flow warning the exam wants you to spot.

Example 2 — Current ratio. Current assets $850,000; current liabilities $500,000 → ratio 1.7 (healthy). If the firm takes a $200,000 short-term loan to cover payroll: CA 1,050,000 / CL 700,000 = 1.5 — deteriorating; the exam tests whether you see leverage eroding liquidity.

Example 3 — Lien chain. Material supplier (no contract with owner) first delivers May 1. NTO must be served by June 15 (45 days). Final delivery September 10 → claim of lien by December 9 (90 days) → foreclose by the following December 9 (1 year). Miss the NTO and the lien right never attaches — the exam's favorite single-point failure.

Example 4 — Straight-line depreciation. Equipment $120,000, salvage $20,000, 5-year life → annual depreciation ($120,000 − $20,000)/5 = $20,000/yr. Book value after 3 years: $60,000.

Example 5 — Bid markup. Direct costs $400,000; overhead 12% of direct ($48,000); target profit 8% on total cost → price = 448,000 × 1.08 = $483,840. (The exam distinguishes markup-on-cost from margin-on-price — label which you're computing.)

6. Pitfalls and trap patterns

• Certified vs. registered. Statewide vs. local-only — a registered contractor working outside the issuing jurisdiction is unlicensed there.
• NTO 45 days. Not 20 (that's California), not 90. Florida's number is 45 — the exam banks on cross-state confusion.
• Open-book ≠ no studying. The reference stack is ~15 books; unprepared candidates run out of time on part 1. Tab, highlight, drill.
• Business & Finance first. Highest failure rate — schedule study time accordingly and take it first while fresh.
• Qualifier departure. The license's qualifying agent leaving triggers notification and replacement deadlines — the business can't operate on a departed qualifier's license.
• Underbilling blindness. Percentage-of-completion questions test whether you recognize under/overbilling and its cash-flow meaning, not just the arithmetic.

7. Practice problems (answers at end)

1. Contract $2M; cost incurred $900k; estimated total cost $1.5M; billed $800k. Recognized revenue? Over- or underbilling, and by how much?
2. CA $600k, CL $450k. Current ratio? Healthy for a contractor?
3. Supplier first furnishes June 1 (no owner contract). NTO deadline? Final furnishing Oct 1 — lien recording deadline?
4. Equipment $90,000, salvage $10,000, 8-year life, straight-line. Year-4 book value?
5. Direct costs $250,000, overhead 15%, profit 10% on cost. Bid?
6. What's the difference between a Florida certified and a registered GC, in one sentence each?
7. A qualifier leaves the company. What must the company do, and why does it matter for active contracts?

Answers: 1. % = 60% → revenue $1.2M; costs+profit ($1.2M) vs. billings ($800k) → underbilling $400k (asset; cash is behind earnings). 2. 1.33 — thin for a contractor (target ~1.5–2.0); liquidity risk. 3. NTO by July 16 (45 days); lien by December 30 (90 days after Oct 1). 4. Depreciation $10k/yr → book value $90,000 − $40,000 = $50,000. 5. 250,000 × 1.15 × 1.10 = $316,250. 6. Certified = licensed by the state, valid statewide; registered = licensed by a local jurisdiction, valid only there. 7. Notify DBPR and qualify a replacement agent within the board's deadline (typically 60 days, verify current rule) — operating without a qualifier is unlicensed activity and jeopardizes permits, contracts, and the license itself.

Exam-format note: question counts, timing, and reference-book lists are per DBPR-published materials and prep-provider summaries as of 2026; DBPR updates the reference list periodically — verify the current Candidate Information Booklet at myfloridalicense.com before buying books.

Original ETS reference writing, verified against public sources on 2026-09-30. Thin sourcing is flagged inline. Not legal advice — confirm current editions with the issuing body.