According to B&P Code 7159, what information must be disclosed about salesperson compensation in home improvement contracts?
Correct Answer
D) Whether salesperson receives compensation from the contract
B&P Code 7159 requires disclosure of whether the salesperson receives any compensation from the contract, but not the specific amount.
Why This Is the Correct Answer
B&P Code 7159 requires the contract to disclose whether the salesperson will receive compensation arising from the contract. The statute's intent is transparency — the consumer needs to know if the person selling them the work has a financial stake — but the law does not require the exact dollar amount or percentage, recognizing that precise figures may be unknown at contract execution.
Why the Other Options Are Wrong
Option A: Exact dollar amount of commission
The exact dollar amount of commission is not required by B&P 7159. Requiring a specific dollar figure would be impractical because commission amounts often depend on final contract price, change orders, or internal company formulas that are not fixed at signing.
Option B: Percentage of commission only
Percentage of commission only is also not the statutory requirement. Even if a percentage were disclosed, the law is satisfied by a yes/no disclosure of whether compensation is received — percentage specificity goes beyond what the code mandates.
Option C: No disclosure of salesperson compensation is required
No disclosure requirement is incorrect. B&P 7159 expressly requires salesperson compensation disclosure as part of the mandatory contract elements. Omitting this disclosure is a violation that can expose the contractor to license discipline.
Memory Technique
Think of it as a 'conflict-of-interest flag': the law just wants the consumer to know 'does this salesperson have skin in the game?' — yes or no. No need for a detailed accounting.
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