California Real Estate Salesperson Exam Practice - Question 71

Question

The California State agency that governs the issuance of liquor licenses is the:

Selections

A. State Board of Equalization

B. State Franchise Tax Board

C. Board of Supervisors

D. Department of Alcoholic Beverage Control 

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Answer: D

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5 Keys Summary

• The California State agency responsible for approving and regulating the issuance and transfer of liquor licenses is the Department of Alcoholic Beverage Control (ABC).

• The authority of the ABC is established pursuant to the Alcoholic Beverage Control Act.

• The ABC has the power to deny, suspend, or revoke an alcoholic beverage license for good cause.

• The ABC investigates each license applicant and may disapprove a license if the location is in the immediate vicinity of a school or church, or if it would create or aggravate a police problem.

• To transfer a license, the applicant and current licensee must file a notice of intended transfer with the county recorder and establish an escrow before filing the license transfer application with the ABC.

Explanations

The Department of Alcoholic Beverage Control (ABC) is the California state agency responsible for approving and regulating the transfer and issuance of liquor licenses. When a business, such as a bar or restaurant, is sold and involves a liquor license, both the seller and buyer must apply to the ABC for approval. The ABC will then investigate and approve the buyer and the proposed business location before the license can be transferred.

The other options are incorrect:

The Board of Supervisors is a local governmental body and is not directly responsible for issuing state-level liquor licenses based on the provided sources.

The State Board of Equalization is responsible for sales taxes and seller's permits.

The State Franchise Tax Board administers California's personal and corporate income taxes and handles withholding requirements for foreign sellers.

Concepts Definitions

Department of Alcoholic Beverage Control (ABC): The California state agency that oversees the regulation and issuance of liquor licenses.

Liquor License: A permit issued by a governmental body allowing a business to sell alcoholic beverages.

State Board of Equalization: A California state agency that collects sales and use taxes and issues seller's permits for the transfer of personal property.

State Franchise Tax Board (FTB): The California state agency responsible for administering state personal and corporate income taxes and managing tax withholdings for foreign sellers.