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VIRGINIA SALES LICENSE TEST QUESTIONS AND ANSWERS
"A Power of Attorney (Form VAD-70) is used on when: - CORRECT ANSWER 1. a title is lost
OR
- the title is held by a lien holder"
"Section "B" on a Power of Attorney (Form VAD-70) is used: - CORRECT ANSWER when a vehicle is sold
prior to the dealer receiving the title"
"Section "C" on the Power of Attorney (Form VAD-70): - CORRECT ANSWER 1. Must always be
completed by the dealer
- Is an affirmation, by the dealer, that the information contained on the form is correct to the best of their knowledge"
"The "Processing Fee" is: - CORRECT ANSWER a charge by the dealer for processing a transaction"
"In order for a dealer to occasionally rent a vehicle without a rental license: - CORRECT ANSWER the
dealer cannot rent a vehicle without a rental license issues by the Virginia Department of Taxation" "A dealer makes a good will substitution for a vehicle previously delivered and titles to a customer. The
sales and use tax refund process is: - CORRECT ANSWER the tax is not refundable"
"A vehicle must be inspected: - CORRECT ANSWER Between the time it comes into a dealer's inventory
and the time it is sold at retails"
"If a vehicle does not pass inspection: - CORRECT ANSWER 1. the dealer may bring it up to compliance
- the dealer may deliver the vehicle with a valid rejection sticker and a written disclosure, which may be in the form of an official inspection receipt" "A dealer licensed as a franchise or independent dealer may buy and sell motorcycles, trailers and motor
homes if they have the proper: - CORRECT ANSWER License issued by MVDB"
"When issuing temporary license plates, the dealer: - CORRECT ANSWER May not charge the customer
more than the fee charged the dealer for the plates."
"Temporary transport plates may be issued for no more than: - CORRECT ANSWER 5 days"
"A salesperson's "certificate of qualification": - CORRECT ANSWER Must be obtained before applying
for a salesperson's license"
"Which of the following statements are true regarding the Truth In Mileage Act? - CORRECT ANSWER
- The buyer and seller must sign and print their names
- The customer must receive a copy of the odometer statements
- An "N" after the odometer reading on the titles means the odometer reading is not actual" "Under Federal law the customer must receive a copy of the odometer disclosure statement. This can be
furnished: - CORRECT ANSWER 1. By giving a cope of the secure reassignment and/or power of
attorney if the title is not available
- By giving a copy of the conforming title" "If a vehicle is to be titled out of state, temporary tags are issued and the purchaser does not have the
required liability insurance, the dealer: - CORRECT ANSWER Must collect 1/12 of the uninsured
motorist see and submit to DMV" "What type of valid proof may a dealer use to prove a Virginia Safety Inspection is performed on a.
vehicle prior to retail sale? - CORRECT ANSWER 1. a receipt from an authorized Virginia Inspection
station identifying vehicle by year, make, model and VIN
- The official state inspection document"
"A new motor vehicle is defined as one which: - CORRECT ANSWER 1. has not been previously titled
- has less than 7,500 miles on the odometer with a disclosure" "Any person who is licensed in another state of the United States as a motor vehicle dealer may sell
vehicles at Dealer Only wholesale auditions in Virginia only after obtaining a: - CORRECT ANSWER
Certificate of registration"
"The following must be licensed to engage i. business in Virginia: - CORRECT ANSWER 1. Motor Vehicle
Dealer
- Motor Vehicle Distributor or Manufacturer
- Motor Vehicle Salesperson" "No salesperson shall be employed by more than one dealer, unless the dealerships are owned by the
same person, partnership or corporation. - CORRECT ANSWER True"
"Each dealership must post a list of the salespersons that work there. - CORRECT ANSWER True"
"Salespersons must carry their license at all times and show it when asked. - CORRECT ANSWER True"
"If you do not renew your salesperson's license by the expiration date: - CORRECT ANSWER You
cannot sell motor vehicles until a current and valid salesperson license has been obtained"
"Regarding "Internet employees" or persons who receive phone calls from internet inquires: -
CORRECT ANSWER 1. may not quote pricing over the phone without a salesperson license
- may greet potential customers and set up appointments without a salesperson license"
"What is an "Open Title"? - CORRECT ANSWER one that has been signed by the titles owner leaving
blank information on the buyer"
"On extended service contracts, for both parts and labor, the dealer must collect: - CORRECT ANSWER
Retail sales tax on one half of the retail cost of the service contract."
"The IRS definition of "cash" does NOT include: - CORRECT ANSWER Personal checks"
"The IRS Cash Reporting Rule can result in which of the following personal penalties to the salesperson:
- CORRECT ANSWER 1. A severe fine
- A criminal felony charge
- Jail time if convicted"
"What does the anti-structuring provision of the IRS Cash Reporting Rule prohibit? - CORRECT
ANSWER Advising customers on how to get around the rule."
"I'm financing a vehicle on an installment sales contract the APR stands for: - CORRECT ANSWER
Annual Percentage Rate"
"Finance charges must be stated in: - CORRECT ANSWER Annual Percentage Rate"
"Full disclosure of credit terms must be made: - CORRECT ANSWER Before a sale is consummated."
"The following is required to be disclosed uber Regulation Z (Truth in Lending) of the Consumer Credit
Protection Act: - CORRECT ANSWER 1. Amount financed
- Late fees and APR
- Schedule of payments"
"If a financing company denies a loan application, it must: - CORRECT ANSWER Provide the applicant
with a written statement explaining the reason of denial within 30 days"
"When can an inquiry be made of a credit-reporting bureau? - CORRECT ANSWER When the customer
signs a credit application" "Under the Truth in Lending Act, when financing an automobile, which of the following charges have to
be disclosed to the customer: - CORRECT ANSWER Annual Percentage Rate"
"An advertisement of a "Sale" must include the sale end date only when: - CORRECT ANSWER It must
always be stated"
"In any advertisement, placed by a dealer, the advertisement: - CORRECT ANSWER must give the
dealers name or "VADLR" must be used" "A dealer's processing fee must be disclosed in an advertisement when the advertised prices included
the processing fee. - CORRECT ANSWER false"
"Advertisements placed on television, radio, or the internet are subject to the Advertising Laws -
CORRECT ANSWER Trye"
"The advertisements Dealer's use for their internet Advertising: - CORRECT ANSWER 1. Have different
legal guidelines through FTC
- Must adhere to the same advertising guidelines as print or television
- Is only allowed if the Dealer uses their dealership's website link"
"Advertisements placed on social media platforms are not subject to the Advertising Laws - CORRECT
ANSWER False"
"The Federal Trade Commission Used Car Rule which sets out the warranty provisions of a sale is known
as: - CORRECT ANSWER The buyers guide window sticker rule."
"The Buyers Guide is placed on a vehicle: - CORRECT ANSWER Before it is offered for sale"
"A Buyers Guide must be placed on: - CORRECT ANSWER 1. Demonstrators available for sale
- Used trucks under 16000 lbs GVW
- Consignment vehicles"
"The Buyers Guide is: - CORRECT ANSWER Attached to the vehicle in a conspicuous place so both sides
can be seen" “What is the penalty for violating the disclosure provisions of the Virginia Dealer Licensing Act's "As Is"
law? - CORRECT ANSWER 1. a $1000 civil penalty
- the customer may return the vehicle"
"Vehicles can be sold in Virginia "As Is" if: - CORRECT ANSWER 1. A buyer’s guide is completely filled
out, signed, and dated by the buyer
- the dealer provides the buyer, prior to the sale, a separate written disclosure as to the effect of an "As Is" sale
- a disclosure is printed on the front of the buyers order" "What does the Federal Trade Commission Used Car Rule say about Dealers offering vehicles for sale at
public auctions? - CORRECT ANSWER A guide must be on the vehicle if the auction is open to the
public"
"The reverse of the Buyers Guide must be signed by the customer and the dealership: - CORRECT
ANSWER In every retail sale of a used vehicle"
"The reverse of the Buyers Guide must be signed - CORRECT ANSWER I'm every retail sale of a used
vehicle"
"An "A" after the odometer reading on the title indicates: - CORRECT ANSWER actual miles driven"
"The term "mileage" as used in the Truth In Mileage Act means: - CORRECT ANSWER The actual
distance the vehicle has been driven"
"An "E" after the odometer reading on a title means: - CORRECT ANSWER Mileage in excess of the
odometers mechanical limits"
"The customer must receive a copy of the odometer statement - CORRECT ANSWER True"
"An "N" after the odometer reading on the title means the odometer reading is not actual - CORRECT
ANSWER True"
"In connection with the transfer of ownership of a leased motor vehicle, the Truth I. Mileage Act requires the lessor to provide the lease with a written statement regarding the mileage of the vehicle.
Some of the information required in the statement is: - CORRECT ANSWER 1. The name of the person
making the disclosure and the current odometer reading
- The date of the statement and lessees and lessor's name and current address
- The identity of the vehicle including the make, model, year, body type, and vehicle identification number"
"If a dealer charges a processing fee it must be current and registered with MVDB and: - CORRECT
ANSWER posted in the public sales area and clearly visible"
"The dealer processing fee is: - CORRECT ANSWER subject to the motor vehicle sales and use tax"
"A salesperson may use a dealer plate if he or she: - CORRECT ANSWER works at least 25 hours each
week on a regular basis and is compensated for this work"
"Dealer license plates may be: - CORRECT ANSWER used on vehicles in the inventory of the dealer"
"A dealer may allow the prospective purchaser to use the license plates assigned to the dealer for: -
CORRECT ANSWER Up to 5 days, and may be renewed once"
"After the DSD 27 is complete , dealer plates may be used on a vehicle in a dealer's inventory: -
CORRECT ANSWER 1. by a prospective purchaser
- by a customer whose vehicle is in the dealer's shop for repairs"
"The form granting permission to use dealer's plates: - CORRECT ANSWER May be issued for a 5 day
period and reissued for one additional 5 day period"
"When may you use Dealer Plates on consignment vehicles? - CORRECT ANSWER If the vehicle is on
consignment from another dealer" "The dealer may authorize a person, other than a full-time employee, to transport a vehicle on a dealer plate to and from a point of sale, an auction, and a repair facility or dealer exchange for a period not to
exceed: - CORRECT ANSWER 24 hours"
"A vehicle identification number (VIN) is comprised of 17 alpha numeric characters. Which character
identifies model year? - CORRECT ANSWER 10th"
"On the buyers order, the line item, "Balance Due at Settlement" is used: - CORRECT ANSWER With
both cash and finance transactions"
"In general, a completed buyers order is legally binding when: - CORRECT ANSWER both parties agree
on a price and sign the buyers order"
"the sales tax on a warranty or service agreement sold to a customer is paid to: - CORRECT ANSWER
The Virginia Department of Taxation"
"Temporary Supplemental Sales (Off-Site Sales) applications (MVDB 22) must be received at MVDB: -
CORRECT ANSWER 1. 15 days prior to the off-site sale
- may only be issued for 8 off-site sales per year
- a temporary sales license may be issued for a period not to exceed 7 days for cars/trucks OR 14 days for motorcycles, trailers, and recreational vehicles" "How many years is a dealership required to maintain proof that a Virginia Safety Inspection as
performed prior to sale at retail? - CORRECT ANSWER 5 years"
"A second set of temporary tags may be issued to a customer if: - CORRECT ANSWER 1. the title is not
available at the end of the first 30-day period
- the vehicle is to be titled and registered out of state
- all paperwork is submitted to DMV along with an explanation as to why a second set needs to be issued
- all required fees are submitted to the DMV before authorization of temporary tags may be issued"
