A time-and-material change is capped at $5,000. Labor and material backup totals $5,460. What amount should be billed under the cap?
Correct Answer
B) $5,000.
The not-to-exceed cap limits billing to $5,000 even though backup totals $5,460.
Why This Is the Correct Answer
The not-to-exceed cap limits billing to $5,000 even though backup totals $5,460.
Why the Other Options Are Wrong
Option A: $4,860.
$4,860. is below the supported result for not-to-exceed control; it likely uses the wrong base, period, or account bucket.
Option C: $5,460.
$5,460. is above the supported result for not-to-exceed control; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $10,460.
$10,460. is above the supported result for not-to-exceed control; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Not-To-Exceed drawer for Enforcing Change: label cap before counting dollars.
Reference Hint
Study anchor (closed-book): memorize Not-to-exceed control from CSLB 2026 Law Book; CSLB Home Improvement Contracts / Business and Professions Code Section 7159 written change order requirements; know the rule or calculation trigger without relying on exam-room lookup.
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