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DMV Sales Test > Test Questions > Flashcards

Test Questions Flashcards

1
Q

What is the penalty for violating the disclosure provisions of the Virginia Dealer Licensing Act’s “As Is”
law?

A

A $1,000 civil penalty.
 The customer may return the vehicle.

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2
Q

Vehicles can be sold in Virginia “As Is” if:

A

A Buyers 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.

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3
Q

A vehicle must be inspected:

A

Between the time it comes into a dealer’s inventory and the time it is sold at retail.

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4
Q

If a vehicle does not pass inspection:

A

The dealer may bring it into 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.

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5
Q

A dealer licensed as a franchise or independent dealer may buy and sell motorcycles, trailers and
motor homes if they have the proper:

A

License issued by MVDB.

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6
Q

A second set of temporary tags may be issued to a customer if:

A

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 paper work 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 Department of Motor Vehicles before authorization of
temporary tags may be issued.

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7
Q

When issuing temporary license plates, the dealer:

A

May not charge the customer more than the fee charged the dealer for the plates.

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8
Q

Temporary transport plates may be issued for no more than:

A

5 days.

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9
Q

A salesperson’s “certificate of qualification”:

A

Must be obtained before applying for a salesperson’s license.

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10
Q

Penalties for violating provisions of the statutes pertaining to motor vehicle salespersons include:

A

A civil penalty of not more than $1,000 per violation.
 Suspension of the license.
 Revocation of the license.

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11
Q

A new motor vehicle is defined as one which:

A

Has not been previously titled.
 Has less than 7,500 miles on the odometer with a disclosure

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12
Q

Temporary transport plates may be used to:

A

Transport vehicles from auctions or other points of purchase or sale

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13
Q

Any person who is licensed in another state of the United States as a motor vehicle dealer may sell
vehicles at Dealer Only wholesale auctions in Virginia only after obtaining a:

A

Certificate of registration.

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14
Q

The following must be licensed to engage in business in Virginia:

A

Motor Vehicle Dealer.
 Motor Vehicle Distributor or Manufacturer.
 Motor Vehicle Salesperson.

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15
Q

No salesperson shall be employed by more than one dealer, unless the dealerships are owned by the
same person, partnership or corporation.

A

TRUE

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16
Q

Each dealership must post a list of the salespersons that work there.

A

TRUE

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17
Q

Salespersons must carry their license at all times and show it when asked.

A

TRUE

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18
Q

Temporary certificates of registration issued by dealers must contain:

A

Date of issuance.
 Name and address of purchaser.
 The temporary plate number and vehicle identification number.

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19
Q

If you do not renew your salesperson’s license by the expiration date:

A

You cannot sell motor vehicles until a current and valid salesperson license is obtained.

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20
Q

If a salesperson is found guilty of violating one or more of the provisions of the Virginia Dealer Laws,
the Motor Vehicle Dealer Board may, after following the prescribed procedures:

A

Assess a civil penalty on the salesperson of up to $1,000 per violation.
 Refuse to renew the salesperson’s license.
 Revoke/Suspend the salesperson’s license.

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21
Q

If a customer wishes to demonstrate (“test drive”) a vehicle in the inventory of the dealer:

A

The salesperson must accompany the customer.
 The salesperson completes a DSD 27 for the prospective customer to have in their possession
during the “test drive”

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22
Q

The Motor Vehicle Transaction Recovery Fund:

A

Is funded by dealers and salespersons.

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23
Q

The purpose of the Motor Vehicle Transaction Recovery Fund:

A

Is to satisfy unpaid judgments against a dealer or salesperson that has defrauded a purchaser.

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24
Q

The dealer or salesperson must reimburse the Motor Vehicle Transaction Recovery Fund:

A

 Within 30 days or the dealer’s or salesperson’s license is automatically revoked.

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25
Q

A temporary certificate of registration:

A

Is issued when the certificate of vehicle title is NOT available at the time of sale.
 Is effective for 30 days.

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26
Q

Temporary license plates:

A

Should be destroyed after expiration or when permanent plates are issued

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27
Q

Payments to individuals by a salesperson for procuring a customer for the salesperson:

A

Is unlawful for any motor vehicle dealer or salesperson licensed in Virginia.

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28
Q

Used vehicles in the inventory of a dealer that do not have a Virginia inspection sticker:

A

Cannot be operated on the highway except to an inspection station.

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29
Q

Applications, taxes and fees collected for the Department of Motor Vehicles on behalf of the buyer must
be submitted to that Agency within:

A

30 days.

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30
Q

If a vehicle is registered in Virginia and the owner does not have liability insurance, the penalty is an
uninsured motorist fee of:

A

$600.

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31
Q

When a thirty-day tag is issued to a customer who does not have insurance and is going to
register the vehicle in Virginia, the dealer:

A

Must handle the titling, registering and payment of fees directly with DMV.
 Must collect the uninsured motor vehicle fee.

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32
Q

Temporary Tags and Temporary Transport Tags can be loaned to another dealer.

A

FALSE

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33
Q

A “Demonstrator” is defined in part as a new motor vehicle which:

A

Has more than 750 miles accumulated on its odometer
 Requires a written disclosure to the customer

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34
Q

Regarding “Internet employees” or persons who receive phone calls from Internet inquires:

A

May not quote pricing over the phone without a salesperson license.
 May greet potential customers and set up appointments without a salesperson license.

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35
Q

What is an “Open Title”?

A

One that has been signed by the titled owner leaving blank the information on the buyer.

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36
Q

On extended service contracts, for both parts and labor, the dealer must collect:

A

Retail sales tax on one half of the retail cost of the service contract.

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37
Q

The IRS definition of “cash” does not include:

A

Personal checks.

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38
Q

The IRS Cash Reporting Rule, enacted to prevent citizens from hiding unreported income, requires
dealerships to complete and file IRS form 8300 when cash receipts exceed the following dollar amount:

A

$10,000.

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39
Q

Violation of the IRS Cash Reporting Rule can result in which of the following personal penalties to the
salespersons:

A

A severe fine.
 A criminal felony charge.
 Jail time if convicted.

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40
Q

What does the anti-structuring provision of the IRS Cash Reporting Rule prohibit?

A

Advising customers on how to get around the rule.

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41
Q

In financing a vehicle on an installment sales contract, the APR stands for:

A

Annual percentage rate.

42
Q

Finance charges must be stated in:

A

Annual percentage rate.

43
Q

Full disclosure of credit terms must be made:

A

Before a sale is consummated.

44
Q

The following is required to be disclosed under Regulation Z (Truth in Lending) of the Consumer Credit
Protection Act:

A

Amount financed.
 Late fees and APR.
 Schedule of payments.

45
Q

If a financing company denies a loan application, it must:

A

Provide the applicant with a written statement explaining the reason of denial within 30 days.

46
Q

When can an inquiry be made of a credit-reporting bureau?

A

When the customer signs a credit application.

47
Q

Under the Truth in Lending Act, when financing an automobile, which of the following charges have to
be disclosed to the customer:

A

Annual percentage rate

48
Q

An advertisement of a “Sale” must include the sale end date only when:

A

It must always be stated.

49
Q

In any advertisement, placed by a dealer, the advertisement:

A

Must give the dealer’s name or “VADLR” must be used.

50
Q

A dealer’s processing fee must be disclosed in an advertisement when the advertised price includes the
processing fee.

A

FALSE

51
Q

Advertisements place on television, radio or the internet are subject to the Advertising Laws.

A

TRUE

52
Q

The advertisements Dealers use for their Internet Advertising:

A

Have different legal guidelines through the FTC.
 Must adhere to the same advertising guidelines as print or television.
 Is only allowed if the Dealer uses their dealership’s website link.

53
Q

Advertisements placed on social media platforms are not subject to the Advertising Laws.

A

FALSE

54
Q

The Federal Trade Commission Used Car Rule which sets out the warranty provisions of a sale is
known as:

A

The buyers guide window sticker rule.

55
Q

The Buyers Guide is placed on a vehicle:

A

Before it is offered for sale.

56
Q

A Buyers Guide must be placed on:

A

Demonstrators available for sale.
 Used trucks under 16,000 lbs. GVW.
 Consignment vehicles.

57
Q

The Buyers Guide is:

A

Attached to the vehicle in a conspicuous place so both sides can be seen.

58
Q

What does the Federal Trade Commission Used Car Rule say about Dealers offering vehicles for sale
at public auctions?

A

A guide must be on the vehicle if the auction is open to the public

59
Q

Under the Federal Trade Commission Used Car Rule, a vehicle can be sold “As Is”:

A

And the “As Is-No Dealer Warranty” box on the Buyers Guide is checked.

60
Q

What is the penalty for violating the Federal Trade Commission Used Car Rule?

A

Over $40,000 plus CPI.

61
Q

“Full” and “Limited” are terms given to:

A

Warranties.

62
Q

According to the Federal Trade Commission Used Car Rule, the following is considered an unfair and
deceptive practice?

A

Representing that a used automobile is sold with a warranty when it is not

63
Q

As described in the Federal Trade Commission Used Car Rule, dealers must display conspicuously on
each used car a:

A

Buyers guide.

64
Q

According to the Federal Trade Commission Used Car Rule, the Buyer’s Guide should be displayed on:

A

Demonstrator or inventory vehicles.
 Consignment vehicles.

65
Q

A dealer must make a copy of the written warranty available for the customer to read prior to the sale.

A

TRUE

66
Q

A dealer can sell a vehicle “As Is” or without a warranty in Virginia

A

TRUE

67
Q

Under the Federal Trade Commission Used Car Rule, the terms of the warranty as stated on the
Buyers Guide:

A

Can be changed and noted on the original Guide or on a new Guide

68
Q

When giving a warranty on a used vehicle the dealer must:

A

Give the customer a copy of the Buyers Guide window sticker.
 Give the customer a warranty document containing certain specific phrases.

69
Q

Which of the following must be included on the Buyer’s Guide?

A

Purchaser’s signature

70
Q

For dealer arranged financing, if the retail installment contract is not approved and the deal is cancelled
you must.

A

Return the customer’s trade-in.

71
Q

The reverse of the Buyers Guide must be signed by the customer and the dealership:

A

In every retail sale of a used vehicle.

72
Q

An “A” after the odometer reading on a title indicates:

A

Actual miles driven.

73
Q

The term “mileage” as used in the Truth In Mileage Act means:

A

The actual distance the vehicle has been driven.

74
Q

An “E” after the odometer reading on a title means:

A

Mileage in excess of the odometers mechanical limits.

75
Q

Which of the following statements are true regarding the Truth In Mileage Act

A

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 title means the odometer reading is not actual

76
Q

The customer must receive a copy of the odometer statement.

A

TRUE

77
Q

An “N” after the odometer reading on the title means the odometer reading is not actual.

A

TRUE

78
Q

In connection with the transfer of ownership of a leased motor vehicle, the Truth In Mileage Act requires
the lessor to provide the lessee with a written statement regarding the mileage of the vehicle. Some of
the information required in the statement is:

A

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.

79
Q

Under Federal law the customer must receive a copy of the odometer disclosure statement. This can
be furnished:

A

By giving a copy of the secure reassignment and/or power of attorney if the title is not available.
 By giving a copy of the conforming title.

80
Q

A Power of Attorney (Form VAD-70) is used only when:

A

A title is lost.
- Or -
 The title is held by a lien holder.

81
Q

Section “B” on a Power of Attorney (Form VAD-70) is used:

A

When a vehicle is sold prior to the dealer receiving the title.

82
Q

Section “C” on the Power of Attorney (Form VAD-70):

A

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?

83
Q

The “Processing Fee” is:

A

A charge by a dealer for processing a transaction.

84
Q

If a dealer charges a processing fee it must be current and registered with MVDB and:

A

Posted in the public sales area and clearly visible.

85
Q

The dealer processing fee is:

A

Subject to the motor vehicle sales and use tax.

86
Q

A salesperson may use a dealer plate if he or she:

A

Works at least 25 hours each week on a regular basis and is compensated for this work.

87
Q

Dealer license plates may be:

A

Used on vehicles in the inventory of the dealer.

88
Q

A dealer may allow the prospective purchaser to use the license plates assigned to the dealer for:

A

Up to 5 days, and may be renewed once.

89
Q

After the DSD 27 is completed, dealer plates may be used on a vehicle in a dealer’s inventory:

A

By a prospective purchaser.
 By a customer whose vehicle is in the dealers shop for repairs

90
Q

The form granting permission to use dealer plates:

A

May be issued for a five day period and reissued for one additional five day period

91
Q

When may you use Dealer Plates on consignment vehicles?

A

If the vehicle is on consignment from another dealer

92
Q

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:

A

24 hours.

93
Q

A vehicle identification number (VIN) is comprised of 17 alpha numeric characters. Which
character identifies the model year?

A

10th

94
Q

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:

A

Must collect 1/12 of the uninsured motorist fee and submit to DMV.

95
Q

On the buyers order, the line item, “Balance Due at Settlement” is used:

A

With both cash and finance transactions.

96
Q

In general, a completed buyers order is legally binding when

A

Both parties agree on a price and sign the buyers order.

97
Q

In order for a dealer to occasionally rent a vehicle without a rental license:

A

The dealer cannot rent a vehicle without a rental license issued by the Virginia Department of
Taxation.

98
Q

A dealer makes a good will substitution for a vehicle previously delivered and titled to a customer. The
sales and use tax refund process is:

A

The tax is not refundable.

99
Q

The sales tax on a warranty or service agreement sold to a customer is paid to:

A

The Virginia Department of Taxation

100
Q

Temporary Supplemental Sales (Off-Site Sales) applications (MVDB 22) must be received at MVDB:

A

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 seven (7) days for cars/trucks
OR fourteen (14) days for motorcycles, trailers, and recreational vehicles.

101
Q

How many years is a dealership required to maintain proof that a Virginia Safety Inspection was
performed prior to sale at retail?

A

5 years.

102
Q

What type of valid proof may a Dealer use to prove a Virginia Safety Inspection is performed on a
vehicle prior to retail sale?

A

A receipt from an authorized Virginia Inspection station identifying vehicle by year, make, model
and VIN.
 The official state inspection document.

DMV Sales Test (1 decks)

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