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3. Friends Gina, Lina and Tina verbally agreed to form an agricultural partnership in order to finance the medical expenses of Lina, Gina and Tina
contributed cash and bags of fertilizers, respectively, while Lina contributed her services. Among them, there is
a. A legal partnership b. A void partnership c. A voidable partnership d. No partnership
4. Which of the following contributions does not require the contract of partnership to appear in a public instrument for it to be legal?
a. Shares of stock in real estate company c. Rice mill for milling business e. None of the above
b. Usufruct of house and lot d. All of them
7. Moe, Curly and Larry are partners in a partnership which borrowed money from a bank. If it failed to pay it at maturity, from whom may the bank
now collect such loan?
a. Partnership only b. 3 partners only c. 3 partners & the partnership d. Any partner
8. What person is not a partner as to actual partners in a partnership but considered a partner as to a third person?
a. Any person considered as such by the third person c. Debtor of such partnership
b. Person who represents himself as a partner to such third person d. None
2. Which of the following about a partnership (P) and a joint venture (JV) is incorrect?
a. Unlike in a P, corporations may be members of a JV c. Both of them are governed by the Civil Code e. All of them
b. Unlike a JV, a P is a legal person d. None of them
4. Which of the following agreed partners’ contributions cannot be made to a universal partnership of all present property created on 25 June
2012?
a. House owned by the only child partner’s parents who died on 28 June 2012 d. None of the above
b. Lot given to a partner on 29 June 2012 by virtue of a last will of his deceased friend e. All of the above
c. Car given to a partner by his aunt on his birthday on 26 June 2012
6. Larry, Moe and Curly verbally agreed on 5 June 2012 to form a partnership which will engage in the buy and sell business and to contribute
money equally on 10 June 2012. Such contributions were actually given by them on 11 June 2012. If the partnership business started
operations on 12 June 2012, when did the partnership begin?
a. 5 June 2012 b. 10 June 2012 c. 11 June 2012 d. 12 June 2012
8. A universal partnership of all profits is formed on 20 June 2012. To that partnership, the following are its mandatory contributions, except:
a. Rent from boarders received by partner today in the 2-storey house he rented since 2011 d. None of the above
b. Cash prize a partner won in the T.V. singing contest “Tingog” yesterday e. All of the above
c. Proceeds of sale of tuna fishes a partner caught from the sea
9. A partner by estoppels is a
a. Limited partner b. Nominal partner c. Silent partner d. None of them
10. Which of the following is not a mandatory contribution to a universal partnership of all present property formed on 31 May 2012?
a. Interest income for June 2012 of time deposit made by a partner since April 2012 d. None of the above
b. House and lot of the only child partner’s parents who died on 31 May 2012 e. All of the above
c. Car bought by a partner in 2011 but has been leased to a 3rd person since 10 May 2012
July 6, 2012
1. Regarding his whole interest in the partnership, a partner
a. May sell it to a 3rd person without the consent of the other partners d. Answer not given
b. Cannot sell it to a 3rd person without such consent
c. May sell only a portion of it to a 3rd person without such consent
2. The partners agreed to entrust the designation of their shares in the profit and loss to a 3 rd person. If after such designation, a partner’s share is
lower than his expectations, he
a. Cannot question it because he is estopped c. May question it only if others also do so
b. May question it only if his share is not fair d. Answer not given
4. Ted, a partner’s son from his former girlfriend, desires to claim support from him. Which of the following partnership rights of his father may be
subjected to such claim?
a. Right in specific partnership property c. Profit share e. All of them
b. Partnership interest d. None of them
5. Partner Nida sold a portion of her partnership interest to a 3rd person, Tim, without the consent of the other partners. Under these
circumstances, which is correct?
a. Tim has no partner’s right c. Tim may exercise partner’s rights other than profit share
b. Tim can only be entitled to Nida’s profit share d. Answer not given
6. The designation of profit and loss shares of the partners may be entrusted to
a. All the partners b. A 3rd person only c. 3rd person or all partners d. None of them
8. A 3rd person they entrusted designated the profit and loss shares of the partners in November 2012. Based thereon, partners A, B and C
received their respective profit shares in December 2012. Under these circumstances, which of the following is correct?
a. Partner A may impugn such designation within 3 months from such designation c. Any partner may impugn it any time he wants
b. Partner B may impugn such designation within 3 months from his knowledge thereof d. None can impugn it.
9. Which of the following statements is incorrect about a partner’s right in specific partnership property?
a. He may use it without the consent of the other partners c. He is its co-owner e. All of them
b. He may have more rights to possess it than the others d. None of them
10. The partners designated their profit and loss sharing. Thereafter, a partner
a. May impugn it if his share is unfair to him d. May impugn it if his share is unfair to all partners & the public
b. May impugn it if his share is unfair to other partners e. Answer not given
c. May impugn it if his share is unfair to all partners
July 13, 2012
1. Without agreement, the partners shall contribute to the partnership capital
a. Any share they like b. Equal shares c. Proportionate shares d. Answer not given
2. If one of the partners is unable to speak in a hospital due to an accident, the other partners are required to render true & full information of all
things affecting the firm to
a. Him b. His legal representative c. Either a or b d. Answer not given
3. To revoke the power of a managing partner appointed at the time of the creation of the partnership, what is required?
a. He acted in bad faith b. ____ of controlling interest c. A & b d. Answer not given
4. The firm suffered damages in the amount of P20,000 through the fault of its capitalist partner, Jack. If from the firm’s annual profit, Jack’s share
is P25,000
a. Jack may compensate such damages with his profit share c. Jack may compensate only if the other partners agree
b. Jack cannot compensate such damages with his profit share d. Answer not given
5. Larry, Curly and Mae are partners without agreement as to management. A 3 rd person, Shemp, owes Curly P10,000.00 with interest and the
partnership P80,000. One day, Curly collects P5,000 from Shemp and issues his own receipt for it. It shall be applied
a. To Curly’s credit only c. To the partnership credit only
b. To the two credits proportionately d. To the credit chosen by Shemp
6. If in No. 5 above, Larry, Curly and Mae contributed P50,000, P10,000, and P100,000 to the partnership printing business respectively and Mae
wants to sell its printing machinery while Larry and Curly refuse to do so, whose idea shall prevail?
a. Mae b. Larry & Curly c. No one d. Mae, if its sale is useful to the partnership
7. Leo, Pio and Tio contributed cash, property and services to the firm, respectively. In case of imminent loss of its business and there is no
agreement, who shall be obliged to sell his interest to Leo, who wants to make additional investment to save it, if Pio and Leo do not make
additional investments because Pio is insolvent and Tio has other priority?
a. Pio only b. Tio only c. Pio and Tio d. None of them
8. If in No. 7 above, the firm is engaged in the restaurant business and Leo just invested in another restaurant business with the knowledge of the
other partners who did not object, what is its adverse consequence to Leo?
a. Pio & Tio may avail of his benefits in the other business with damages c. Leo may be excluded from the firm by Pio & Tio
b. Leo is required to bring his profit in the other business to the firm d. None
9. Roxanne promised to contribute a pink Nissan 2012 model car worth P1.5 million to the firm. By making such promise, what shall be her
obligations to the firm
a. To deliver such car c. To deliver its fruits without demand
b. She is bound for warranty against eviction d. All of them
10. The interests ratio of partners Jan, Jane, Jamie and Janelle to the firm are 45:25:20:10 respectively. Jan, Jane and Janelle are appointed
managers without specifying their duties. If Jane and Janelle want the firm to cater into a compromise agreement with its creditor to reduce its
liability but Han does not want to, whose idea shall prevail?
a. Jane and Janelle c. Jan only if Jamie agrees with her
b. Jan d. No one
July 20, 2012
1. The partnership bears the risk of the following contributions, except:
a. 50 sacks of rice c. Goods for sale e. All of them
b. Use of partner’s only car d. None of them
3. Who shall be liable for the penalty charged by the BIR on the partnership for failure to file its ITR because its managing partner wants it to avoid
paying taxes?
a. Managing partner alone c. All partners and the partnership
b. All partners d. Partnership only
4. The partnership is engaged in the ordinary fuel station business near SM CDO. One day, on request of a customer, its managing partner
promised to deliver 20 liters of its gasoline to his house in Bukidnon. Who shall be bound by such promise?
a. The partnership c. The partnership and all the partners
b. The partnership only if the controlling interest agrees d. Managing partner only
6. Which of the following is always required for a third person to be a partner by estoppel
a. The misrepresentation as partner must be made to a would be partnership creditor d. All of them
b. One or more partners must consent to such misrepresentation e. None of them
c. There must be an existing partnership
7. Capitalist partners Jack and Jill and industrial partner Hill agreed that Jill will not be liable for the partnership’s obligations. If after exhausting
partnership assets, its creditor still has a loan receivable from the general partnership, who shall be liable to it?
a. Jack only b. Jack and Hill c. Jack and Jill d. All the partners
8. Sole managing partner Jun received 100 sacks of flour from a customer for storage in its business warehouse for a fee. Later, partner Lito
withdrew 2 sacks and used it during his fiesta celebration. Who shall be liable to such customer for those 2 sacks?
a. Partnership alone b. Lito alone c. Partnership and all partners d. All partners
9. The partnership owes P5,000 to Ted, a third person. For partner Myrna to validly request his friend Ted to renounce his claim fro the
partnership, she
a. Must be a managing partner c. Must represent its controlling interest
b. Must be authorized by the other partners d. None of them
10. Roy, Joy, and Doy are partners. For their partnership to borrow money, Roy and Doy misrepresented to PNB that Bert is its partner although he
is not. Trusting on such misrepresentation, PNB lends money to the partnership. Who shall be liable to PNB?
a. The partnership and Bert as partner c. The partnership and Bert not as partner e. Bert alone
b. Roy, Doy and Bert only d. The partnership alone
August 17, 2012
1. A limited partner may demand the return of his contribution at these periods, except:
a. On date specified for its return in the Certificate of Limited Partnership d. None of them
b. If not so specified, within 6 months after giving written notice to other partners e. All of them
c. On its dissolution
2. Without a contrary statement in the Certificate or without the consent of all partners, a limited partner has the right to demand the return of his
capital
a. In cash, regardless of his contribution c. In the same form as his contribution
b. In cash only if he contributed cash d/ Answer not given
4. W/o written consent or ratification by all limited partners, a general partner may
a. Admit a general partner c. Possess firm property not for its purpose e. All of them
b. Admit a limited partner d. None of them
5. The substituted limited partner is not liable for the liabilities of the limited partner if
a. He was ignorant of them at the time he became a substituted limited partner d. None of them
b. Such liability cannot be ascertained from the Certificate e. All of them
c. He substituted a limited partner who died
6. In the order of payment during liquidation of a limited partnership, which of the following is given the third priority?
a. Limited partner’s other compensation by way of income c. Limited partner’s share of profits
b. Limited partner’s capital d. Loans to limited partner
10. Which is correct about a limited partner and general partner at the same time?
a. He becomes one the moment all the partners agree c. He has all the rights of a general partner e. All of them
b. He has all the rights of a limited partner d. None of them
August 24, 2012
1. Which of the following is incorrect about a corporation?
a. It enjoys certain constitutional rights under the bill of rights d. None of the above
b. It cannot exercise a profession e. All of the above
c. It cannot be punished with imprisonment for committing a crime
4. Which of the following is not among those that cannot be a close corporation?
a. A water district b. Private school c. Bus company d. None of them e. All of them
5. Which of the following is correct about a foreign corporation under the Corp. Code?
a. To be its resident agent, a domestic corporation must be of sound financial standing d. None of them
b. The liabilities of its officers are governed by Philippine laws e. All of them
c. Without license to engage in business in the Philippines, it cannot sue or be sued here
2. The corp.’s management committee cannot be delegated with these powers, except
a. Enter into a management contract c. Issue stock dividend e. All of them
b. Amend its articles of incorporation d. None of them
4. If its secretary enters into a fair and reasonable contract with the stock corporation, it is
a. Valid only if ratified by stockholders rep. 2/3 of the outstanding cap. Stock (OCS) c. Voidable
b. Valid d. Void
6. Juan, a director of Magnolia, Inc., sells its rival corp.’s product, Selecta, exclusively in his own store and cuts Selecta ice cream during its board
meetings. Which is correct?
a. As a rule, he is guilty of disloyalty under the Corporation Code d. All of them
b. As a rule, he should refund its profits to the corporation e. None of them
c. He is not affected if his acts are notified by stockholders esp. 2/3 of the OCS
7. Who has the power to fix the issue price of no par value shares if it is not granted in the articles of incorporation or by-laws?
a. Board of directors and stockholders rep. 2/3 of the OCS c. Board of directors alone
b. Board of directors and stockholders rep. A majority of the OCS d. Stockholders alone
8. An agricultural corp.’s power to establish a car plan for the benefit of its directors
a. Is an express power b. Is an implied power c. Is an inherent power d. Is ultra vires
9. Who has the power to enter into a management contract with another corp. whose stockholders representing the same interests of both
corporations own more than 1/3 of the total OCS?
a. Board of directors and stockholders rep. 2/3 of the OCS c. Board of directors alone e. None of them
b. Board of directors and stockholders rep. A majority of the OCS d. Stockholders alone
10. In a meeting, 7 of 8 directors voted for the issuance of 900 shares with P10 par value to Jack for P8,000 while one abstained. Under these
circumstances, which is correct?
a. Only the 7 directors who voted are liable for watered stocks but only t the corporation e. No one is liable for watered stocks
b. Only the 8 directors are liable for watered stocks but only to the corporation f. None of them
c. Only the 8 directors are liable for watered stocks to the corporation and its creditors
d. Only the 7 directors who voted are liable to the corp. & its creditors for watered stocks
September 25, 2012
1. Who of the following has no right to inspect corporate books?
a. Stockholder who mortgaged all his shares to a third person c. Voting trustor e. All of them
b. Voting trustee d. None of them
3. In the liquidation of a corporation, who should be paid third in the order of priority?
a. Stockholders preferred as to dividends c. All stockholders
b. Inside creditors or loans from stockholders d. None of them
5. What suit should a stockholder file if the board of directors refuse to let him vote?
a. Representative suit b. Derivative suit c. Individual suit d. Class suit
8. Verbal notice of stockholder’s special meeting to remove a director was sent 1 week prior thereto. In that meeting attended by all stockholders,
a director was removed by a vote of stockholders representing a majority of the outstanding capital stock. Under these circumstances, which of
the following is correct?
a. Meeting is improper, proceeding is void c. Meeting is proper, proceeding is valid
b. Meeting is proper, proceeding is void d. Meeting is improper, proceeding is valid
2. Which of the following cannot be contributed by stipulation to a universal partnership of all present property created on 1 August 2012?
a. Rental income of car acquired by partner through his friend’s last will on 8/2/12 d. None of the above
b. Motorcycle given to a partner by his godfather on his birthday on 1 August 2012 e. All of the above
c. Use of a truck acquired by partner upon the death of his grandfather on 8/3/12
3. Larry, Curly and Moe agreed to form a partnership business for the purpose of selling Japanese Koi fishes. Among them, there is a partnership
a. With a fixed term b. With a particular undertaking c. At will d. None of them
4. In the absence of stipulation, a partnership engaged in the sale of fruits and dry goods bears the risk of these contributions, except:
a. Things brought and appraised in the inventory c. Goods for sale e. All of them
b. Baskets of mangoes d. None of them
6. Rico, Jacko and Coco are the only partners of their business. With his consent, a third person’s name is included by them in their partnership’s
name. The third person
a. Is a partner by estoppels c. Has a partner’s liability only
b. Has a partner’s rights only d. Has a partner’s rights and liability
9. Without agreement, each partner’s share or right is equal as to the following, except:
a. Contribution to satisfy partnership liabilities c. Possession of specific partnership asset e. All of them
b. Initial contribution of capitalist partners d. None of them
10. Partners Sam, Pam, and Jam decided to share the firm’s credit equally and collect it individually. If Sam collected his share of the credit giving
his own receipt while Pam and Jam are unable to do so because its debtor later absconded, which is correct?
a. Sam is considered a partnership trustee only if he is a managing partner
b. Sam is considered a partnership trustee even if he is not a managing partners
c. Sam is not considered a partnership trustee, whether he is a managing partner or not
d. Sam, Pam and Jam are considered as partnership trustees
11. Which of the following is not subject to stipulation under the law on partnership?
a. Satisfaction of a new partner’s liability for firm debts arising before his admission d. None of them
b. Where the partnership books should be kept e. All of them
c. Rights of partner’s assignee
13. As a rule, less than all partners have no authority to do the following, except:
a. Sell its franchise to a non-creditor of the firm c. Compromise its firm liability e. All of them
b. Waive its receivable from a partnership debtor d. None of them
14. Bert misrepresented to PNB that he is a partner of Noel and Tess who are not actual partners. Relying on such misrepresentation, PNB gave
them credit. If Noel and Tess consented to such misrepresentation, who shall be liable to PNB for such credit?
a. Bert as a partner c. Bert, Noel and Tess as partners
b. Bert, Noel and Tess pro rata d. Answer not given
16. Without agreement and fraud on him, which is not a right of a partner’s assignee?
a. Receive the assigning partner’s profit share c. Apply for dissolution of partnership e. All of them
b. Require partnership accounting d. None of them
17. After dissolution, a partnership is in no case bound by a partner’s act, which is not appropriate for winding up of its affairs, in which of the
following instances?
a. Partnership has become insolvent c. Either of the above
b. It is dissolved because it is unlawful for a partner to carry on its business d. Neither of the above
18. Non-managing partner Fred derived profit from leasing a partnership property to a third person without the consent of the other partners. For
this, he is considered
a. A partnership debtor b. A partnership trustee c. Both d. Neither
19. If a firm borrowed money from Juan, a 3rd person whose name is included in the firm name with his consent; Pedro, who is a partner’s assignee;
and Ted, who is a partner by estoppels in a transaction, who should be paid first during its liquidation after dissolution?
a. Juan b. Pedro c. Ted d. The three of them e. Answer not given
20. Mike, one of the managers of the firm appointed with stipulation that all of them must agree for the validity of an act of administration, was
convicted by final judgment of a crime punishable by life imprisonment. Its legal effects are the following, except:
a. His legal wife is entitled to true and full information affecting the firm on her demand d. None of them
b. The other managers may validly execute acts of administration without his consent e. All of them
c. The firm will be automatically dissolved
21. Which firm contribution does not require its agreement to appear in a public instrument?
a. Statues for sale c. Contract for servitude e. All of them
b. Fruits of 10 year old mango plant d. None of them
23. A partner’s liability for partnership debts shall be satisfied out of its assets alone in which of these instances?
a. For a partner’s act binding the firm after dissolution if he is unknown at that time c. Both a and b
b. For its debts arising before his admission as new partner regardless of agreement d. Neither a nor b
24. Which of the following is not an obligation of the partnership to its partners?
a. Debt incurred by partner in good faith for the interest of its business d. None of them
b. Risks in consequence of its management e. All of them
c. Interest for partner’s disbursement for it
25. Which of the following stipulations by partners is not void as to third persons?
a. A capitalist partner is exempt from sharing losses c. The managing partner will designate their profit share
b. A capitalist partner is exempt from partnership liability d. None of them
June 21, 2013
1. For a partnership with a total capital of P3,000 to be legal, which is not required?
a. Its agreement must be in an instrument to be executed in public d. All of them
b. It must be registered with the SEC e. None of them
c. It must have an inventory
2. A contract of partnership is
a. A formal contract c. Subject to the statute of frauds e. All of them
b. A real contract d. None of them
3. Ben, Vic and Ric verbally agreed to contribute paintings, statues, and cash, respectively, to their partnership that will engage in the art store
business. If there is no inventory of their contributions, their contract of partnership is
a. Valid but unenforceable c. Void
b. Valid & enforceable d. Answer not given
5. Lito, Earl and Ben are owners of a building. If Lito receives 20% share of the gross income derived from the lease of the building to third
persons
a. He is a partner in the lease business c. He is not presumed as such partner
b. He is merely presumed as such partner d. Answer not given
6. In verbally forming an agricultural business with Maria in order to finance her college education, Juan and Pedro agreed to contribute fertilizers
in sacks and shares of stock from a real estate company respectively. Among the three of them, there is
a. A legal partnership b. A void partnership c. Answer not given
7. The partnership of Jack, Jill and Hill borrowed money from PNB. If the partnership fails to pay its monthly obligation to PNB, from whom may it
collect such obligation?
a. Partnership only b. Partnership and the partners c. Partners only
10. What is the legal consequence if a partnership engaged in the pharmacy business also sells prohibited drugs to its customers?
a. Only its profits from prohibited drugs will be immediately confiscated c. None of its profits will be confiscated
b. All its profits from its pharmacy business will be immediately confiscated d. Answer not given
June 28, 2013
1. If a partner assigns a portion of his profit share to a third person, Ted, without the consent of the other partners, which of these statements is
correct regarding his rights?
a. Ted is entitled only to receive such profit share d. None of them
b. Ted is not entitled to any right of a partner e. All of them
c. Ted may be entitled to other partner’s rights aside from his profit share
3. Which of the following constitutes a mandatory contribution of the partners to a universal partnership they formed on 5 May 2013?
a. Truck purchased by a partner on 4 May 2013 and used by him until now d. None of the above
b. House boarders’ rent received today by a partner who rented it since 1 May 2013 e. All of the above
c. P2,500 cash received by a partner on 31 May 2013 as salary for teaching part time
4. After they designated their profit shares in March 2013, partner Jack received his profit share in May 2013 while the other partner, Jane, has not
yet received her profit share. Who is allowed to question his or her profit share today?
a. Any of them b. Jane only c. Jack only d. Neither of them
9. Partners Ric, Dic and Nic entrusted the designation of their profit shares to a third person, Vic. If, later, Dic is unsatisfied with the designation of
his profit share, which of the following may be his valid reason to impugn it?
a. Ric influenced Vic b. It is unfair c. Vic is Nic’s boyfriend d. None e. All of them
10. Which of the following cannot be contributed by stipulation to a universal partnership of all present property created on 1 May 2013?
a. Land purchased by a partner on 1 June 2013 d. None of the above
b. His neighbor’s house given to a partner in her Last Will on 5 May 2013 e. All of the above
c. Agricultural lot inherited by a partner from his parents who died on 1 May 2013
July 5, 2013
1. Without agreement as to its management Jack, Jill and Hill formed their partnership which is engaged in the grocery business. What is required
to dismiss its cashier?
a. The consent of any of them c. The consent of all of them e. Answer not given
b. The consent of at least 2 of them d. The consent of the court
2. A third person, Jun, has separate demandable debts to the partnership for P100,000 and its managing partner, Jane, for P5,000 with interest. If
Jun paid P4,000 to Jane who issued the partnership’s receipt for it, to which credit or credits should it be applied?
a. The partnership’s credit fully c. Jane’s credit fully
b. The two credits proportionately d. Jane’s credit fully only if chosen by Jun
3. In their partnership engaged in the restaurant business, Lolo, Piolo and Jolo contributed cash, furniture and services, respectively. If Piolo
invested cash in another restaurant business and the other partners know about it but did not oppose it, which is correct?
a. Piolo is required to bring his profits from the other business to the partnership
b. Lolo & Jolo may either exclude him or avail of such profits with damages in each
c. Only Lolo may either exclude him or avail of such profits with damages in each
d. Lolo & Jolo have no right whatsoever against Piolo for his other business
4. If in the same firm in No. 3 above, there is an imminent loss of its business and Lolo failed to make additional contributions to save it because
he is insolvent while Piolo made additional contributions and Jolo did not bother to do so, which is correct?
a. Lolo & Jolo are obliged to sell their interests to Piolo c. Only Jolo is obliged to sell his interest to Piolo
b. Only Lolo is obliged to sell his interest to Piolo d. No one is obliged to sell his interest to Piolo
5. The right to a formal account as to its affairs is available to the only industrial partner of a partnership in these instances, except:
a. Another partner derived profits without his consent from the use of its car d. All of the above
b. He is excluded by the other partners for engaging in a different business e. None of the above
c. He is not allowed by the other partners to possess specific partnership property
6. If a partner can no longer talk after losing his vocal chords in an accident, to whom should other partners render true & full information about all
things affecting the firm?
a. To such partner only c. To such partner but with condition
b. To such partner or his legal representative d. To such partner’s legal representative
7. The day after the partners verbally agreed to form their partnership, they signed its Articles of Partnership for its restaurant business and
appointed Roxan as its managing partner. What is required to oppose her desire to change its accounting system?
a. Just or lawful cause b. Consent of controlling interest c. A & b d. She is in bad faith
8. The partners agreed to divide the firm’s receivable from Yu equally and collect it separately. After partner Lee collected his share, Yu refused to
pay the shares of its managing partner and the other partners. Consequently, which is correct?
a. Lee is required to give his collection to the firm if he issued his own receipt for it
b. Lee is required to give his collection the firm if he issued its own receipt for it
c. Lee us not required to do so as he is not its managing partner
d. Answer not given
9. The firm’s managing partner received payment from one of its creditors and kept it in his pocket. Later, he used it to pay for his own debt. To the
firm, he is liable to pay
a. Such amount, interest and damages from the time he kept it c. Such amount plus interest only
b. Such amount, interest and damages from the time he used it d. Answer not given
10. Without agreement, how much should the capitalist partners contribute to firm capital
a. Any share they like b. Equal shares c. Proportionate shares d. Answer not given
July 12, 2013
1. For a non-partner, Jill, to be considered a partner by estoppel by a third person, Jack, which of the following is not required?
a. There must be an existing partnership of whom Jill is misrepresented as a partner d. None of them
b. Such misrepresentation must be made or communicated to Jack e. All of them
c. Jack must have given credit to that existing partnership
2. In their partnership, Bill and Ted are capitalist partners while Kille is an industrial partner. All of them agreed that Bill is exempt from liability to
creditors. If after its assets are exhausted, the firm still has a liability to a creditor, from whom may it collect?
a. All partners b. Ted and Kille only c. Ted only d. None of them
3. Which of these statements about a partnership creditor & a partner’s creditor is incorrect?
a. As to a partner’s property, the latter is preferred over the former d. All of the above
b. The latter may ask the attachment and public sale of a partner’s share in the firm assets e. None of the above
c. The latter may charge a partner’s interest in the partnership with payment of his debt
5. So that the firm will not be able to deliver his order in time and be liable for damages, a customer notified only its silent partner when to make
such delivery. Such notice is
a. Notice to the firm c. Not notice to the firm for other reason
b. Not notice to the firm because there is fraud d. Answer not given
7. While partner Ben is in the hospital and partner Jean is abroad, its managing partner Lane failed to pay its taxes on time to the BIR, which later
imposed a fine on the firm. Who shall be liable for such fine?
a. The firm only b. The firm and all the partners c. Lane only d. All the partners only
9. While acting in the ordinary course of the firm business, its manager partner caused injury to its capitalist partner by his wrongful act. Who shall
be liable for such injury?
a. Managing partner only c. All partners solidarily
b. All partners & the firm solidarily d. Answers not given
10. After Jay was admitted as a partner in March 2013 by partners Kay and Ray, a creditor of their general partnership exhausted all its assets to
collect its debt which was incurred in February 2013. If thereafter, there is still a balance of its debt, who shall be liable for it?
a. All the partners b. Kay & Ray only c. The partnership only d. Answer not given
July 18, 2013
1. If a partner has become insolvent, which of the following statements is incorrect?
a. Against his personal assets, his debt to the firm is preferred over his debt to partners by way of contribution d. None of them
b. The firm will never be bound by his act after its dissolution e. All of them
c. The firm will not be terminated yet
2. If a universal partnership with no term incurred a net loss for 5 consecutive years
a. If cannot be dissolved yet c. A partner’s assignee may apply for its dissolution e. None of them
b. Any partner may apply for its dissolution d. All of them
3. If a partner dies and the firm business is continued by the remaining partners without settlement of accounts, the rights of his legal
representative are the following, except:
a. To have the value of his interest ascertained at dissolution d. None of the above
b. To receive as an ordinary creditor an amount equal to such value with interest e. All of the above
c. To receive the profits attributable to the use of his right in the dissolved firm
4. When a partner withdraws from the partnership before the expiration of its agreed term and the other partners continued its business using the
same firm name, which is incorrect?
a. They may pay the withdrawing partner less than the value of his interest d. None of them
b. They are required to indemnify the withdrawing partner against all future debts e. All of them
c. They can use its name during such term
5. Which of these does not dissolve a firm engaged in farming by decree of court?
a. A partner has unintentionally violated the partnership agreement many times d. None of the above
b. A capitalist partner has been under lucid interval after being declared insane last month e. All of the above
c. Industrial partner immigrates to Canada
8. If after it is dissolved due to the death of a partner, the partnership still has liabilities to its creditor, Jack, after all its assets are exhausted, which
of the following is correct?
a. Jack has the right to run after the personal properties of all partners d. None of them
b. Jack has the right to run after the personal properties of all living partners only
c. Jack has no right to run after the personal properties of any partner
9. In the order of payment of firm liabilities during its liquidation, the capital of partners
a. Ranks second b. Ranks third c. Ranks fourth d. None of them
10. If a partner in a universal firm marries another partner today, which is incorrect?
a. The firm is dissolved without decree of court d. Answer not given
b. A partner’s act of buying from its suppliers tomorrow can never bind the firm
c. A partner’s act of selling to its customers tomorrow binds the firm
August 2, 2013
1. As a rule, a limited partner is liable as a general partner in these instances, except:
a. After knowing his wrong belief that he is a limited partner, he renounces his profit share d. None of them
b. When he takes part in the selection of the business manager e. All of them
c. When he deals with a customer
2. Without their only limited partner’s consent or ratification, all general partners may
a. Admit a limited partner c. Sell the goodwill of the business e. All of them
b. Admit a general partner d. None of them
3. The liability of a substituted limited partner (SLP) compared to that of the limited partner he substituted is
a. Always the same, except only those he did not know at the time he became an SLP d. Not always the same
b. Always the same, except only those that could not be ascertained from the Certificate e. Answer not given
c. Always the same, except only those mentioned in both a and b above
4. Which of the following is correct about a limited and general partner at the same time in the same limited partnership?
a. He becomes one the moment all the partners agree d. None of them
b. He is entitled to all the rights of a limited partner and a general partner e. All of them
c. After exhausting its assets, its creditors may run after his personal properties
5. In the liquidation of a limited partnership, what is the order of payment for a limited partner’s other compensation by way of income?
a. First b. Second c. Third d. Fourth
7. If one suffers loss by relying on a false statement in the Certificate which was known by a limited partner at the time he signed it and he is later
substituted by his assignee, who is now liable for such loss as a rule?
a. Both the limited partner and the substituted limited partner c. Only the limited partner
b. Only the substituted limited partner d. None of them
8. If a limited partner’s surname, which is not the same as the surname of any other partner, newly appears in the firm name after his admission,
which is correct?
a. He is liable as a general partner but none of his rights d. He has all the general partner’s rights & liabilities
b. He is liable as a general partner and has some of his rights e. Answer not given
c. He has some of a general partner’s rights but may not be liable like him
10. Which is incorrect about a mere limited partner and his substituted limited partner?
a. The Certificate is required to be amended for the former to be additionally admitted to the partnership and for the latter to be a substituted
limited partner
b. Even if only the former is empowered by the Certificate to give his assignee the right to become a substituted limited partner, the latter may
also give such right
c. If the latter becomes one due to the former’s death, he is not liable for any of his debts
d. None of the above
e. All of the above
Midterm 08.07.2013
1. In their rose-producing business, the partners contributed rose plants in plastic containers, P5,000 cash, and fertilizers actually used in those
containers. If it is formed verbally, the firm is
a. Valid but unenforceable b. Valid & enforceable c. Void d. Answer not given
2. A partnership and a joint venture may have the following common characteristics, except:
a. They may involve a temporary business c. They are governed by the law on partnership e. None of them
b. Their members share in the profits d. All of them
3. Its creditor, Jean, can no longer run after the personal properties of its general partner, Jack, to satisfy her claim arising from a transaction with
the partnership in these instances, except when
a. Partnership incurred such claim before it admitted Jack as a partner d. None of them
b. Jean, who is unaware of its dissolution & does not know Jack, transacted it thereafter e. All of them
c. Jean entered into such transaction with an insolvent partner after its dissolution
4. If a partner partially satisfied her debt to her personal debtor, Ric, by assigning her interest in the partnership to him, Ric is entitled to the
following, except
a. To be paid fourth in the liquidation of the dissolved partnership d. None of them
b. Ask the attachment of her share in the partnership assets e. All of them
c. Require an account from the date of the last account agreed by partners
5. Larry, Curly and Moe are partners. One day, Beth, who has demandable debts to their firm and Moe, paid him P3,000 for which he issued his
own receipt. Which of these is incorrect?
a. Such payment should be applied proportionately to the credits of the firm and Moe d. None of the above
b. Moe may alter an immovable property of the firm without the consent of Larry & Curly e. All of the above
c. Moe is a partnership trustee
6. If the partners agreed to form a universal partnership on 1 June 2013, which of the following is not a mandatory contribution to such
partnership?
a. Right to enjoy a partner’s only car he has borrowed from a friend since January 2013 d. None
b. A capitalist partner’s July 2013 profit share from another partnership as its industrial partner e. All of them
c. Proceeds of sale of partner’s own house he resided in 2012 but sold yesterday
7. If partner Fred withdraws from the partnership before the expiration of its term and its business is continued by the other partners using its same
name, which is correct?
a. The other partners may pay the value of Fred’s interest therein in cash or property d. None of them
b. Aside from such value of his interest, Fred is entitled to compensation e. All of them
c. The value of Fred’s interest includes goodwill
8. Which of these statements about a partner’s right in specific partnership property is incorrect?
a. A partner may subject such right to attachment c. It can never be subject to legal support e. All of them
b. All the partners may assign their rights therein d. None of them
9. Who may apply for the dissolution of the partnership by decree of court?
a. A partner’s personal creditor c. A partner’s legal representative e. All of them
b. A third person who buys a partner’s interest on credit d. None of them
10. In using a specific partnership property, partner Bert earned income without the knowledge of his other partners. Under these circumstances,
which is incorrect?
a. The other partners have the right to a formal account of the partnership affairs d. None of them
b. Bert is liable to the partnership for such income, interest and damages e. All of them
c. Bert is considered a partnership trustee
11. If a partner dies and the partnership business is continued by the remaining partners without liquidation, which of the following statements is
correct?
a. His legal representative will receive as an ordinary creditor the value of his interest d. None of them
b. Before such receipt, partnership creditors must receive their claims first e. All of them
c. The remaining partners may not pay the value of his interest
12. Po, Ho and So agreed to exclude So from sharing profits. If their firm still owes its creditor, Wo, P30,000 after its assets are exhausted and Ho
dies, which of these is correct?
a. After giving the required payment to Wo, Po is entitled to reimbursement from So d. None of them
b. Po is required to pay Wo more than P10,000 e. All of them
c. Wo cannot recover from all the partners’ personal properties
13. If the partnership suffers damages through the fault of its industrial partner, which of the following is correct?
a. He may compensate it with his profit share only with the consent of all partners d. None
b. If it earns unusual profits in the same activities, his liability may be lessened by the court e. All
c. His liability may be lessened only if it earns such profits through his extraordinary efforts
14. Which of the following acts of a partner does not constitute an act of ownership?
a. Enter into a compromise about its loss c. Assign its generic things for creditors e. All of them
b. Submit its claim to arbitration d. None of them
15. If in their partnership name, the surname of a non-partner, Vicky, is included with her consent, which of the following is correct?
a. Vicky is always liable as a partner to third persons c. Her liability to third persons is prorata
b. Vicky may not be liable as a partner to third persons d. Answer not given
16. Which of these requires that a firm contract should appear in a public instrument to be valid?
a. Right to cross a piece of land is contributed by a partner to the firm d. None of them
b. The partners agreed to purchase land for their beach resort business e. All of them
c. The partners signed an inventory of their contributions
18. An unknown partner who does not participate in the management of the partnership
a. Ostensible partner b. Silent partner c. Nominal partner d. Dormant partner
20. Their liability to pay the value of the interest of a partner whose violation of the partnership agreement caused its dissolution may be secured by
the remaining partners continuing it by
a. Paying it in cash b. Paying it in property c. Either a or b d. Neither a nor b
21. It is that point of time when the partners stop to carry on the firm business together
a. Dissolution b. Winding up c. Termination d. None of them
23. A partner is also liable for interest and damages of a sum of money
a. Owned by the firm is used by him for personal purpose c. Either of them
b. He promised to contribute is not given on time d. Neither of them
August 20, 2013
1. To avoid its legal obligations to its workers who sued it for paying wages below the minimum wage, Fruit Corporation became insolvent after
transferring its assets to another corporation, Bread Incorporated, which it dominates. Under these circumstances,
a. The workers can claim only from their employer, Fruit Corporation
b. The corporate character of Bread Incorporated may be abrogated
c. The corporate character of Bread Incorporated cannot be abrogated
d. Answer not given
10. Which of the following is correct regarding a foreign corporation in the Phil.?
a. Rules & regulations applicable to domestic corp. Govern the duties of its officers d. All of the above
b. For a domestic corp. to be its resident agent, it must have sound financial standing e. None of the above
c. If it has no license to do business in the Phil., it cannot sue here but may be sued
August 27, 2013
1. Which of these is a legal requirement to incorporate a private stock corporation?
a. 25% its pre-incorporation subscription must be paid in cash c. Promotion e. None of them
b. Its by-laws must be filed before incorporation d. All of them
3. If Moe’s 100 delinquent shares are sold by a corporation at a public auction to the highest bidder, Ted, who offers to pay the required amount
for 80 shares, which is correct?
a. Only 80 shares will be issued to Ted and 20 will become treasury shares c. 100 shares will be issued to Ted
b. Only 80 shares will be issued to Ted while 20 shares will be issued to Moe d. None of them
8. If Jack subscribed shares of stock in June 2013 to be paid on 30 December 2013 as specified in his subscription contract, which of the following
is correct?
a. His subscription liability may be due before 30 December 2013 d. None of them
b. He may be liable for interest thereon before 30 December 2013 e. All of them
c. His shares may become delinquent before 30 December 2013
10. Which of the following is not a ground for suspension or revocation of the certificate of registration of a corporation?
a. Failure to file by-laws within the required period d. None of them
b. Corporation becomes continuously inoperative for 5 years e. All of them
c. Failure to commence its operations within 2 years from incorporation
September 2, 2013
1. There are 15 trustees of a non-stock corporation as fixed in its articles of incorporation. If 2 just died, what is the number required for them to
validly lay down its policies?
a. 8 b. 7 c. 5 d. 4 e. Answer not given
3. Fruit Corp. And Veggy, Inc. have interlocking directors whose interest in the latter represents 20% of its outstanding capital stock. As a rule, a
contract between them is
a. Valid b. Valid if fair and reasonable c. Voidable d. Voidable if there is fraud
4. Jack is a director of a corporation that manufactures Selecta brand ice cream. If Jack always eats its competitor’s ice cream, Magnolia, during
board meetings and sells it exclusively in his own store, which of the following is incorrect?
a. He is guilty of disloyalty under the Corporation Code d. None of them
b. He is required to refund all his profits arising from its sales to his corporation e. All of them
c. He is not penalized for his acts if ratified by a vote of stockholders rep. 2/3 of OCS
5. To elect its corporate secretary, what is the required minimum number of votes from the 14 directors of a stock corporation if its articles of
incorporation fix its quorum at 10 and 2 of them just died?
a. 3 b. 4 c. 5 d. Answer not given
7. If out of 10 directors, 8 voted for the issuance of 1,000 shares at P100 par value per shares to Tess who gave as full payment thereof her lot
with a fair value of P95,000 while the other 2 talked to its secretary about their opposition against it, which is correct?
a. The 8 voting directors are solidarily liable to the corporation for P5,000 e. Answer not given
b. All directors are solidarily liable to the corporation for P5,000
c. Those directors are solidarily liable with Tess to the cprp. & its creditors for P5,000
d. All directors are solidarily liable with Tess to the corp. & its creditors for P5,000
8. If 2 out of 15 directors of a stock corporation die, who will fill up such vacancies?
a. Vote of stockholders rep. 2/3 of the OCS c. Vote of the majority of 15 directors
b. Vote of the majority of the 13 directors d. Answer not given
10. For the contract entered into by a stock corporation and its treasurer, who attended the meeting for its approval, to be valid, which of the
following is required?
a. It is ratified by its stockholders rep. 2/3 of its OCS c. It is fair and reasonable e. All of them
b. Full disclosure of adverse interest d. None of them
September 10, 2013
1. Which of the following is not an express power of a food & beverage corporation?
a. To make reasonable donations to support the anti-pork barrel rally in EDSA d. None of the above
b. To establish vacation plans for the exclusive benefit of its directors e. All of the above
c. To give reasonable financial aid to a palaeontologist who is digging for dinosaur fossils
2. If a corporation wants to manage the gasoline station of another corporation, who is required to approve the contract between them for that
purpose?
a. Board of directors and stockholders rep. 2/3 of the OCS c. Board of directors alone
b. Board of directors and stockholders rep. a majority of the OCS d. None of them
3. A cement corporation’s act of operating an electric plant to supply electricity to its cement factory and to its employees living within its
compound is
a. Its express power b. Its implied power c. Its incidental power d. Ultra vires
5. Stockholders representing a majority of the outstanding capital stock are required to exercise these powers, except:
a. Fix issue price of no-par value shares if not granted to the board d. None of them
b. Grant compensation other than per diems to directors e. All of them
c. Fill in a vacancy in the board caused by expiration of term
6. Who may exercise the power to invest corporate funds in another business?
a. Board of directors and stockholder rep. 2/3 of the OCS c. Executive committee e. All
b. Board of directors and stockholders rep. a majority of the OCS d. None
7. Stockholders representing 2/3 of the outstanding capital stock are required to approve the decision of the board of directors in these instances,
except:
a. Create bonded indebtedness c. Issue stock dividends e. All of them
b. Repeal its by-laws d. None of them
8. To acquire its own shares, the corporation is required to have the following, except:
a. Unrestricted retained earnings c. Approval by its stockholders rep. certain shares e. All of them
b. Vote of the majority of its board in a quorum d. None of them
9. Who has the power to abandon the approved mortgaged of all corporate properties?
a. Board of directors and stockholder rep. 2/3 of the OCS c. Board of directors e. All
b. Board of directors and stockholders rep. a majority of the OCS d. None
10. To extend its term, a non-stock corporation is required to have these, except:
a. Vote of the majority of its board in a quorum d. None of them
b. Ratification by 2/3 of its members e. All of them
c. Dissenting members are given the appraisal right
September 16, 2013
1. Which of the following statements about a voting trust agreement is incorrect?
a. The voting trustee is qualified to be a director of the corporation d. None
b. Both voting transferor and trustee have the right to inspect corporate books e. All
c. The voting trustee may vote by proxy in the stockholder’s meeting
2. A stockholder may exercise his appraisal right in any of these instances, except:
a. Deny the pre-emptive right granted to stockholders in the articles of incorporation d. None of them
b. Extension of corporate term e. All of them
c. Investment of its corporate funds
3. For its annual stockholders’ meeting, the corporate secretary sent a written notice to all stockholders 1 week prior thereto. If in that meeting,
90% of the stockholders were present while the rest were represented by their proxies and stockholders representing a majority of its OCS
removed 2 members of the board, which is correct?
a. The meeting is improper but its proceedings are valid d. The meeting is proper but its proceedings are not valid
b. Both the meeting and its proceedings are not valid e. Answer not given
c. Both the meeting and its proceedings are valid
5. When are the stockholder’s rights of one exercising appraisal right suspended?
a. from the time he makes any demand for the payment of the fair value of his shares d. Answer not given
b. From the time he makes such demand within 30 days from taking of vote
c. After the lapse of 30 days from the time he makes such demand
6. If the board refused in bad faith to allow a stockholder to inspect its corporate books to check if it committed fraud despite his demands, what
may he file against its members
a. Individual suit b. Derivative suit c. Representative suit d. None of them
8. How much should the corporation, which implemented the action opposed by a stockholder in the exercise of his appraisal right, pay him for his
shares?
a. Their fair value as of his valid demand for their payment c. Their fair value as of the day such action is implemented
b. Their fair value as of the taking of the vote for an action he opposed d. None of them
10. When is a stockholder who exercised appraisal right entitled to cash dividends?
a. Anytime or before and after such exercise
b. If he is not paid of the fair value of his shares within 30 days from his demand thereof
c. If he is not paid of the fair value of his shares within 30 days from their appraisal
d. None of them
September 23, 2013
1. If by the required votes of their respective boards and stockholders, A Corporation and B, Inc. agreed to enter into a contract of merger, which
of the following is incorrect?
a. Only one of them will automatically acquire the rights and liabilities of the other d. None of them
b. There is no need for winding up or liquidation of the assets of both corporations e. All of them
c. Only one of these corporations will be dissolved
2. In 2007, Jack filed a case for damages against Pepsi, Inc. which was represented in that case by its lawyer. In 2009, Pepsi, Inc. undertook a
voluntary dissolution. The court issued a final and executor decision in 2012 awarding Jack P1 million. If Jack will claim such award today by
asking the court sheriff to implement it, which is correct?
a. It can no longer be implemented because Pepsi, Inc. no longer exist d. All of them
b. It can no longer be implemented because Pepsi, Inc. has no trustee e. None of them
c. It can no longer be implemented because it is late
3. In the order of liquidation of a dissolved corporation with all kinds of shares, its holders of common shares should be paid for such shares
a. Second b. Third c. Fourth d. Fifth
5. In the voluntary dissolution of a corporation, which of these distinctions between one where no creditors are affected and one where its creditors
are affected is incorrect?
a. Unlike in the former, there is a newspaper publication requirement in the latter d. None of them
b. Unlike in the latter, there is no hearing requirement in the former e. All of them
c. Unlike in the former, there is a petition filed with the SEC in the latter
6. Which of these about the merger of two non-stock school corporations is correct?
a. Its articles must be approved by the required votes of their trustees and their members d. None of them
b. Its plan must be signed by their presidents and certified by their secretaries e. All of them
c. It must be approved by two government agencies
8. If the articles of merger were executed by two corporations on 9/01/13 and both corporations became liable for damages to third persons on
9/2/13, which is correct?
a. As of 9/01/13, only one of them is liable for all the liabilities of both corporations
b. As of 9/02/13, only one of them is liable for all the liabilities of both corporations
c. As of 9/01/13, one of these corporations already cease to exist
d. None of them
9. If after its dissolution in 2011, a corporation conveyed today all its assets to its trustees for the benefit of its stockholders and creditors, which is
incorrect?
a. Its stockholders and creditors are now the beneficial owners of its assets d. None of them
b. Its trustees are now the legal owners of its assets e. All of them
c. All interest the corporation had in its assets are now terminated
10. If in the liquidation of X Corporation, its assets in Cagayan de Oro City are distributable to its creditor, Pedro who is from Butuan City but is
unknown, and to its stockholder Juan who is from Iligan City but cannot be found, which is correct?
a. All their shares of its assets will be given to Cagayan de Oro City c. Their shares will be given to their respective legal heirs
b. Their shares will be given to Butuan City for Pedro’s and Iligan City for Juan’s d. None of the above
Semifinal exam 10.1.2013
1. Which is incorrect about a stock corporation’s by-laws submitted before incorporation?
a. It must be approved by all its stockholders who signed its articles of incorporation d. None of the above
b. It may be amended after incorporation by the board & stockholders rep. 2/3 of its OCS e. All of the above
c. Its stockholders rep. 2/3 of the OCS may delegate to the board the power to amend it
4. If the total assets of the limited partnership is P500,000 and its liabilities are P300,000 to a limited partner Jack and P400,000 to an outside
creditor Jean, which is correct?
a. Jack is entitled to receive a pro-rata payment of his claim from the partnership assets d. None of the above
b. Jack may hold any partnership asset as collateral security for his claim e. All of the above
c. If the partnership is dissolved, Jack can demand the return of his capital contribution
5. Who is required to acquire its own shares to pay stockholders exercising appraisal right
a. Board and stockholder rep. 2/3 of OCS c. Board alone
b. Board and stockholders rep. a majority of the OCS d. None of them
6. Which is a right of a limited and general partner in the same limited partnership?
a. His profit share must be paid first before those of general partners d. None of the above
b. For its loan from him, it must be paid together with its debt to outside creditors e. All of the above
c. He may demand the return of his contribution even before dissolution
8. Which of the following is not a ground for the dissolution of a limited partnership?
a. Insanity of one general partner and the partnership is not continued d. None of them
b. A limited partner rightfully but unsuccessfully demands the return of his capital e. All of them
c. Death of the only limited partner
9. Which of these is incorrect about the compensation of directors other than per diems?
a. Its total for this year must not exceed 10% of net income before income tax last year c. Both
b. It must be granted by stockholders rep. a majority of the OCS d. Neither
12. Which is incorrect about a corporation’s plan to invest its funds in another corp.?
a. It must be approved by the board and stockholders rep. 2/3 of the OCS d. None of them
b. A stockholder may exercise appraisal right on such plan e. All of them
c. A non-voting share may vote on such plan
14. Which is incorrect about incorporators and stockholders of the same corporation?
a. Not all stockholders may be incorporators c. Any stockholder may be an incorporator e. All of them
b. All incorporators are stockholders d. None of them
18. Which of these does not require that the corporation has unrestricted retained earnings
a. Its purchase of its redeemable shares c. Its declaration of cash dividends e. All of them
b. Its purchase of its own delinquent shares d. None of them
19. As a rule, which of these has no right to vote on the corporation’s proposed merger?
a. Holder of subscribed shares not fully paid at maturity date c. Mortgagor of shares e. All of them
b. Holder of non-voting shares d. None of them
21. If there are 10 trustees of a non-stock corporation and, later, there is a vacancy because one of them resigned, what is the required no. of votes
to fill up such vacancy?
a. 4 votes in meeting attended by 9 trustees c. 3 votes in meeting attended by 9 trustees e. None of the above
b. 4 votes in meeting attended by 6 trustees d. 3 votes in meeting attended by 5 trustees
24. Under the Corp. Code, the corporation’s president is required to sign the
a. Certificate of shares of stock c. Articles of incorporation e. All of them
b. Amendment to by-laws d. None of them
25. Which of the following is not part of the outstanding capital stock of a corporation?
a. Shares whose holder demanded payment of their fair value in exercise of appraisal right d. None of them
b. Delinquent shares e. All of them
c. Founder’s shares
1. For a limited partnership to exist, which of the following is not required?
a. Agreement appears in a public instrument c. Written agreement filed with SEC e. All
b. Word “limited” or abbreviation “Ltd.” Is added to its name d. None of them
2. Which of these is incorrect about a limited and general partner at the same time?
a. He is liable to partnership creditors to the extent of his personal properties d. None of the above
b. Has right to dissolve the partnership on grounds not available to general partners e. All of the above
c. In liquidation, he is given priority over general partners in the return of his capital
3. Without the consent of all limited partners, all general partners have no authority to do any of these acts, except:
a. Continue its business on a general partner’s death c. Admit a limited partner e. All of them
b. Assign its specific property d. All of them
6. Which of the following may not make a limited partner liable as a general partner to partnership creditors?
a. His surname, different from those of other partners, appears in firm name for first time d. None of them
b. He signed the certificate knowing it contained false statements, causing loss to them e. All of them
c. He contributes also services to the partnership
10. Limited partner Jack contributed P80,000 in cash to the limited partnership. Later, the latter borrowed P100,000 from Jack, P200,000 from its
outside creditor and P150,000 from its general partners. If its assets totalled only P150,000 and Jack rightfully demands the return of his
contribution before its dissolution, the partnership
a. Is now obliged to pay him P100,000 d. Is now obliged to pay him other amount
b. Is now obliged to pay him P100/P300 x P150,000 e. Is not yet obliged to pay him any amount
c. Is now obliged to pay him P100/P450 x P150,000
June 19, 2014
1. Which of the following cannot exist in a partnership?
a. Co-ownership b. No actual contribution c. Sharing of gross returns d. None e. All
2. In May 2014, Jack, Jill and Hill verbally agreed to form a partnership and contribute cash, services and goods for its grocery store. If days later,
Jack also contributed a portion of his building where they plan to transfer such store, what happens to the partnership?
a. It is valid b. It is valid only if certain conditions are met c. It is void
4. If the partners formed a universal partnership on 1 April 2014, which of the following is not a mandatory contribution thereto?
a. A partner’s salary as insurance salesman for May 2014 d. None of them
b. Cash prize won by a partner from an SM raffle draw in June 2014 e. All of them
c. May 2014 rental fee paid by taxi driver of car owned by partner since March 2014
5. Lito, Roxan and Ed are partners of a universal partnership engaged in the lending business. If, thereafter, Roxan marries Ed, what is the legal
effect?
a. Both can remain in their business partnership c. Only one may remain therein
b. Both cannot remain in their business partnership d. Only one cannot continue therein
7. If the partners formed a universal partnership of all present property on 1 May 2014, they may contribute by stipulation the following, except:
a. June 2014 rental income of car donated to a partner by his mother on 2 May 2014 d. None of them
b. Cows inherited solely by a partner from his parents who died on 1 May 2014 e. All of them
c. Car acquired onerously by a partner on 1 June 2014
8. On 6/4/14, Larry, Curly and Moe verbally agreed to form a partnership on 6/8/14 and contribute P500,000 cash, usufruct of a 500 square meter
lot and services, respectively. On 6/5/14, they signed a notarized contract to that effect and attached thereto a signed inventory of such lot. If
they gave their contributions the following day, when did their partnership begin?
a. 6/4/14 b. 6/5/14 c. 6/6/14 d. 6/8/14
2. Jack and Jill are partners. If Jack derives profit from the use of a partnership property without Jill’s consent, which of the following is incorrect?
a. He is considered its trustee for such profit c. He is not allowed to hold such profit e. All of them
b. She may demand a formal account as to its affairs d. None of them
3. He is a partner who is known only to his other partners and does not manage the firm
a. Secret partner b. Nominal partner c. Ostensible partner d. Dormant partner
4. If a universal partnership of all present property engaged in farming is formed on July 1, 2014, which of the following may be contributed to it by
agreement of the partners?
a. Horse given to a partner on July 2, 2014 from his neighbor’s Last Will d. None of the above
b. Calf born on July 3, 2014 from a cow donated to a partner on July 1, 2014 e. All of the above
c. Truck driven by a partner as only child on 7/24 after his parents died the day before
6. Which of these does not require a public instrument for the partnership to be valid?
a. In forming their partnership, its partners agreed to purchase a house and lot d. None of the above
b. In creating it, its partners promised to contribute their contracts of public works e. All of the above
c. In forming a partnership engaged in selling lots, its partners agreed to contribute lots
7. Who of them has no right to demand true information of things affecting the firm?
a. Wife of partner dying of cancer c. Partner who became mute & blind due to accident e. All
b. Mother of single partner who is missing for 10 years d. None
10. Partners Ha, He, Ho and Hu contributed cash, equipments, cash and services, respectively, to their partnership and agreed to a profit sharing
ratio of 20:20:20:40, respectively. If He and Hu are appointed as its managers without specifying their duties and, later, they cannot agree
whether to hire a janitor or not, whose decision prevail?
a. Majority of all the partners c. He, Ha and Ho
b. Hu and either Ha or Ho d. Answer not given
11. The partners in No. 10 above agreed to divide the partnership’s P10,000 receivable from Ann based on their profit sharing ratio and to collect it
separately. If after He collected P1,000 from Ann, she did not pay the other partners because he assigned all her properties to her creditors as
payment by cession, which is correct?
a. He is required to give P1,000 to the partnership c. He has no such obligation
b. He is required to give only a portion of such amount d. Answer not given
13. Jun, Jan and Jean verbally agreed to contribute P1 million cash, P800,000 worth of canned goods and the P20,000 monthly rental income of a
building, respectively, to their partnership. Such partnership is
a. Valid and enforceable b. Valid but unenforceable c. Void d. None of them
14. Which of the following is correct about partnership contributions?
a. An industrial partner can never be a partnership debtor about his contribution d. None
b. A partnership can exist even without agreement to give them e. All
c. A partner may be required to give something different from his promised contribution
15. If 3 engineers agree that their engineering partnership will continue for as long as mutually satisfactory and for the purpose of rendering
services to clients, there is a
a. Partnership (PP) with a fixed term b. PP with a particular undertaking c. PP at will
16. W/o the other partners’ consent, the managing partner may do these acts, except:
a. Sell a partnership lot b. Sell its good will c. Renovate its building d. None e. All
17. Which of the following cannot be a characteristic of a partnership created by industrial partners?
a. Subject to statue of fraud b. Formal contract c. Onerous d. None e. All
2. If a partner retires and the partnership is continued by his other partners without settlement of accounts between them, his legal representative
has these rights, except
a. Becomes an ordinary creditor of the remaining partners d. None of them
b. Choose either to receive the value of his interest or certain profits e. All of them
c. Have the value of his interest ascertained at his death
4. Larry, Curly and Moe were partners of Fruits Company. If Curly dies and its business is continued without liquidation by Larry and Moe who
admitted Shemp as their partner
a. Only the creditors of Fruits Company (FC) may run after Shemp’s personal properties
b. Only the creditors of FC cannot run after Shemp’s personal properties
c. Both the creditors of FC and the new partnership cannot run after those properties
d. Both the creditors of FC and the new partnership may run after those properties
5. A partnership was engaged in the mail order bride business. When a law was passed making such business unlawful, it was dissolved. If
thereafter, the partners entered into a contract for the first time with a lawyer to file a case against its debtor, which is correct?
a. Such act binds the partnership c. Such act does not bind the partnership
b. Such act binds the partnership only if the lawyer does not know about its dissolution d. None
7. Which of the following ranks fourth in the order of payment during liquidation of a dissolved partnership?
a. Capital contributions of partners c. Profit shares of all partners e. None of them
b. All contributions of partners d. Profit shares of certain partners
8. Jack and Jill are partners of their partnership named “Jack & Jill Forever”. If Jack withdraws before its agreed term, Jill has the following rights
and obligations, except:
a. Pay Jack not less than the amount equivalent to the value of his interest d. None of them
b. Continue its business in the same name without limit e. All of them
c. Pay Jack only in cash for whatever he is legally entitled
9. Blake, Black and Bloke are partners. After their partnership became insolvent, Black ordered its new supplies to be sold to a customer from Bill
who has no previous dealings with the partnership but knew about it before its insolvency. If the partnership has no more assets to pay Bill, who
shall be liable to him?
a. The three partners c. Black and any partner whom Bill previously knew as a partner
b. Black only d. None of the partners as it is the liability of the partnership
2. If a silent partner in a bakery business sells its products to a customer, which of the following is required so that such sale will not bind the
partnership?
a. Such customer knows he is a silent partner c. Both a and b
b. His other partners have abandoned such business d. None, because it is binding
3. Jim, Jun and Joe contributed P100,000, P50,000 and P40,000, respectively, to their partnership engaged in selling flowers and agreed to a
profit sharing ratio of 50:30:20. If Jim wants to sell its roses to a customer at a discount but the other partners oppose, who will prevail?
a. Jim, because of his capital c. Based on profit ration
b. Jun and Joe because they are the majority d. Answer not given
4. Assuming the same partnership in No. 3 above, if its P90,000 loan to creditor Jean is already due and demandable, she can now collect from
each general partner
a. P30,000 c. Based on profit ratio
b. In proportion to his contribution d. Answer not given
5. The legal representative of a deceased partner may be entitled to these rights, except:
a. Receive as an ordinary creditor the profits attributable to the use of such partner’s rights d. None of them
b. Demand true and full information of all things affecting the partnership e. All of them
c. Exercise a certain personal right of such partner
9. Which of these stipulations by partners involving their industrial partner is not void?
a. He may engage in other business without express consent from partners d. None
b. He is required to make additional contribution in case of imminent loss of business e. All of them
c. His right in specific partnership property is subject to legal support
10. A partnership with Jack as managing partner is dissolved upon the death of partner Jun. If, thereafter, partner Rick borrowed money from Phil,
who has no prior dealings with it, to pay taxes for the sale of its assets, the partnership, as to such loan, is
a. Bound if Rick is not insolvent c. Both a and b
b. Bound if Phil knew the partnership but does not know Jun’s death d. Not bound
12. Ha, He and Ho are partners of a barber shop business. Later, Ha and He misrepresents to Te that Le is their partner when he is not and Te
extended credit to their partnership relying thereon
a. Te may collect from Ha, He and Le only after exhausting the assets of the partnership d. Answer not given
b. Te may collect from Ha, He, Ho and Le only after such exhaustion
c. Te may collect directly from Ha, He and Le only
14. Larry, Curly and Moe contributed P40,000, P30,000 and P10,000 to their partnership and agreed to a profit sharing ratio of P50:40:10. If it has
no more assets and partnership creditor Jean still has a P120,000 credit, how much should Curly pay her?
a. 30/80 x P120,000 c. P40,000
b. 40% x P120,000 d. None yet
15. Assuming the same facts in No. 14 above, if Larry properly paid his obligation to Jean for her credit, which of the following consequences
thereof is correct?
a. He has obligations to Curly and Moe c. He has receivables from Curly and Moe
b. He has an obligation to one of the partners d. He has a receivable from one of them
16. Which of the following partners’ contributions requires their agreement to appear in a public instrument for the partnership to be legal?
a. Corn milling machine to be sold in the partnership business d. None of them
b. Road constructed by government over a partner’s private land e. All of them
c. Row boats for the river resort business of the partnership
17. Without agreement to the contrary, general partner Jean is not liable to partnership creditor, Jack, who still has a receivable against it after
exhausting all its assets in these instances, except:
a. Such credit arose after its dissolution and Jack does not know her as a partner d. None of them
b. Such credit arose before its dissolution w/o liquidation and she is admitted thereafter e. All of them
c. Such credit arose before her admission
18. If the partners formed a universal partnership of all present property on 1 August, 2014, which of the following is not a mandatory contribution
thereto?
a. Land left behind by a couple who died on 8/01/14 and whose only child is a partner d. None
b. Car received by a partner on 7/31/14 from a friend’s Last Will and Testament e. All
c. House being leased by a partner since it was given to him by his aunt in 2013
20. The vote of partners representing the controlling interest is required in these instances, except:
a. To make an important alteration in the immovable property of the partnership d. None of them
b. When 2 managers appointed w/o specifying their duties can’t agree to hire a worker e. All of them
c. To revoke the power of a managing partner appointed after the partnership’s creation
August 29, 2014
1. Which of the following statements about a corporation is incorrect?
a. It cannot exercise the accounting profession d. None of them
b. It remains even if all its stockholders/members, officers and board members dies e. All of them
c. It may not be sued for committing a crime
2. Mars is a foreign corporation engaged in the business of selling chocolates outside the Philippines. If it purchases jeepneys here and the
Filipino seller fails to deliver them, it is
a. Allowed to sue such seller here only if it also sells chocolates here d. Not allowed to sue here
b. Allowed to sue such seller here only if it has a license e. Answer not given
c. Allowed to sue such seller here without further condition
3. If a corporation sole wants to sell its golden crucifix for P10 million to a third person, what is required under the Corporation Code for such sale
to be valid?
a. It must be approved by the appropriate court c. Either a or b
b. It is allowed by its rules and regulations d. None
3. Which of the following stock corporations may issue no-par value shares?
a. Telephone company b. Mining company c. Shipyard company d. None e. All
7. Jack subscribed 10 shares of stock for P10,000 from X Corporation and paid only P6,0000. If, thereafter, the shares became delinquent and
sold by the corporation at public auction to the highest bidder, Jean, who offered to buy 8 shares, which is correct?
a. Only 8 shares will be issued to Jean, while the 2 shares are considered treasury shares c. All the 10 shares will be issued to Jean
b. Only 8 shares will be issued to Jean, while the 2 shares will be issued to Jack d. None of them
4. If out of 6 directors, one died, who shall fill up the vacancy created by such death?
a. 5 remaining directors b. 4 directors c. 3 directors d. 2 directors e. Stockholders
5. If the deceased director in NO. 4 above was elected on 9/12/13 and he died on 9/8/14, what is the term of his successor who is elected to fill up
the vacancy caused by his death?
a. More than 1 year b. 1 year only c. Less than 1 year d. Less than 1 week
6. For a contract entered into by the corporation and is director to be valid, which of the following is always required?
a. Full disclosure of adverse interest c. Contract is fair and reasonable e. All of them
b. There is no opposition or objection thereto d. None of them
7. If directors Pedro, Lito and Berto consented to the issuance of 1,000 shares of stock at 100 par value to Juan for P90,000 while directors Nilo
and Ben vocally argued against it during the meeting for its approval, which of the following statements is correct?
a. All directors are solely liable to the corporation and its creditors for P10,000 d. None of the above
b. Only Pedro, Lito and Berto are solely liable to the corporation and its creditors for such amount
c. All directors are solely liable only to the corporation for such amount
8. After he was appointed by the corporate president as its accounting manager, Jack entered into a contract with the corporation regarding the
sale of materials. As a rule, such contract is
a. Voidable b. Valid c. Void d. None of them
9. If by virtue of his office, Jack in No. 8 above acquires for himself a business opportunity belonging to the corporation, thereby obtaining profits to
its prejudice, which is correct?
a. He is guilty of disloyalty to the corporation d. None of them
b. He is required to refund those profits to the corporation e. All of them
c. He is not required to make such refund only if it is ratified by certain stockholders
10. Filling up of vacancies in the board of directors may be made by the following, except:
a. Remaining directors b. Stockholders c. Executive committee d. None of them e. All
1. By-laws may be amended by the following, except:
a. Board and stockholders representing a majority of the outstanding capital stock (OCS) d. None of them
b. Board and stockholders representing 2/3 of the OCS e. All of them
c. Board alone
2. Which of the following is not an express power and incidental power at the same time of a corporation?
a. To continue to exist after the death of all its stockholders in a flood c. To change its name e. All of them
b. To sue its corporate debtors d. None of them
4. The vote of stockholders representing 2/3 of the OCS is required in these instances, except:
a. Enter into a management contract with another corporation with different stockholders d. One of them
b. Invest corporate funds for its secondary purpose e. All of them
c. Remove a member of its board of directors
5. If the sole purpose of a corporation is to deliver packages anywhere in the Philippines, which of the following may be its implied power?
a. Purchase an airplane c. Construct a building e. All of them
b. Hire mountain climbers d. None of them
6. Which of the following is not an express power of a corporation engage in the business of manufacturing cement?
a. Give food packages to persons displaced by flood d. None of them
b. Sue a person for hacking its internet website e. All of them
c. Establish a retirement plan for exclusively for its directors
8. The board alone or stockholders representing a certain number of the OCS alone may exercise these powers, except:
a. Fill in vacancies in the board c. Adopt new by-laws e. All of them
b. Fix issue price of no-par value shares d. None of them
9. The board and stockholders representing 2/3 of the OCS may exercise which of the following powers?
a. Invest its funds for its sole purpose
b. Enter into a management contract with another corporation majority of whose board is also the majority of its own board
c. Repeal its by-laws
d. None of them
e. All of them
10. If the board alone declared stock dividends, which of these is correct?
a. Such act is ultra vires and illegal c. Such act is not ultra vires but illegal
b. Such act is ultra vires but not illegal d. Such act is neither ultra vires nor illegal
1. Neymar, Luiz, Julio, Thiago and Hulk contributed P10,000, P5,000, P12,000, P23,000, and services, respectively, to their partnership engaged
in selling cell phones. They appointed the last four as managers without specifying their duties. If Julio and Luiz want to give customer discounts
which is oppsed by Thiago and Hulk, which is correct?
a. Thiago and Hulk will prevail c. Whoever is supported by Neymar will prevail
b. Julio and Luiz will prevail d. None of them
2. Te, Co and Yu are capitalist partners while Ho is an industrial partners. If there is an imminent loss of their partnership business and only Co
made additional contributions to save it because the others did not want to do so and Te is insolvent, which is correct?
a. Te, Yu and Ho are obliged to sell their interests to Co c. Only Yu is so obliged
b. Only Te and Yu are obliged to sell their interests to Co d. No one is obliged
3. Jack, Jill and Hill are partners. If due to an accident, married Jack losses both his arms and legs while single Jill only breathes and is kept alive
only by machines, to whom is Hill obliged to render true and full information of all things affecting their partnership?
a. Jack’s legal wife and Jill’s mother c. Jack and the mother of Jill e. No one
b. Jill’s mother only d. Jack’s legal wife only
4. A day after partners Curly, Larry and Moe formed their partnership, they appointed Curly as its manager. What is required to validly oppose
Curly’s act of administration?
a. Vote of the controlling interest c. Both a and b
b. Just or lawful cause d. Neither a nor b
6. Jane, Vicky and Cherry are partners. Rica owes their partnership P100,000 and had a debt with a penal clause to Vicky in the amount of
P5,000. If both debts are demandable and Rica paid P4,000 to Vicky who issued her own receipt, it should be
a. Applied proportionately to the 2 credits c. Applied fully to the partnership’s credit
b. Applied fully to Vicky’s credit d. Applied to the credit chosen by Rica
7. After the partnership grocery business managed solely by Lito failed to pay its loans to PNB, he wants to sell a portion of its parking lot in order
to prevent PNB from foreclosing the whole lot. How can the other partners validly oppose such sale?
a. They cannot since Lito is the managing partner
b. They will seek court intervention if it is manifestly prejudicial to its interest
c. They cannot because such sale is not manifestly prejudicial to its interest
d. They will tell him they are opposed
9. Partners Tom, Dick and Harry agreed to divide equally a partnership credit from Lily and collect their respective shares separately. If after
collecting his share, for which he gave his own receipt, Tom becomes insolvent and she refuses to pay the other partners,
a. Tom is not liable to the partnership for any of his collected share since he is insolvent d. Answer not given
b. Tom is liable to the partnership for the full amount of his collected share
c. Tom is liable to the partnership for a portion of his collected share
10. If the partnership suffered damages through the fault of the managing partner who contributed only services, which of the following is correct?
a. He is liable to the partnership and may compensate it with his profit share
b. He is liable to the partnership but he cannot compensate it with his profit share
1. Juan, Pedro and Berto are partners in a partnership engaged in the gasoline station business. One day, Pedro sold and delivered its diesel fuel
to Jane in her house. Such sale
a. Binds the partnership c. Does not bind the partnership
b. Binds the partnership only if Juan & Berto consented d. Answer not given
2. Capitalist partners Curly & Moe and industrial partner Larry agreed that their profit sharing ratio is 30:50:20 and that Larry is exempt from
sharing partnership liabilities to its creditors. If it owed Liza P150,000 and after she exhausted all its assets, it still has a debt to her of P100,000,
who are liable to Liza and how much?
a. Curly, Moe & Larry P30,000, P50,000 and P20,000, respectively c. None of the partners because it is a partnership debt
b. Curly & Moe only, 30/80 and 50/80 of P100,000 respectively d. The three of them, P33,333.33 each
3. Among the partners in No. 2 above, how much should they contribute? (same choices as above) b.
4. For a non-partner to be a partner by estoppel by means of misrepresentation to a 3 rd person who extends credit on the faith thereof, which of
the following is required?
a. Such misrepresentation must be communicated to the 3rd person d. All of them
b. The partner by estoppel must give his consent to the misrepresentation e. None of them
c. There must exist an actual partnership
5. To their partnership engaged in the cell phone business, Jack contributed cash while Jill and Hill contributed services. If, known by his partners
who just remained silent, Hill invested only cash in his friend’s restaurant business, which of these is correct?
a. Hill has no obligation whatsoever to his partners because they did not object e. None of them
b. The other partners may exclude Hill from their partnership and demand damages
c. Hill has no obligation to his partners because he invested only cash in the restaurant
d. Hill has obligations to the partnership for his restaurant business
7. If a partner disbursed his own personal funds for its expense, the partnership
a. Is liable to him for such funds only c. Is liable to him for such funds, interest and damages
b. Is liable to him for such funds plus interest thereon d. Is not liable to him
8. Mario and Carlo are the only partners of their partnership. To borrow money from Gina, Mario brought with him a rich man, Berto, and told her
that he is also their partner. Relying on such representation, she lends money to the partnership. If after exhausting all its assets, she still has a
credit against the partnership, who shall be liable to her?
a. Mario, Carlo and Berto pro rata c. Mario and Berto only pro rata
b. Mario and Carlo only pro rata d. None of them
9. While the managing partner was attending the partnership hardware store, he argued with another partner how to operate one of its products.
When the former demonstrated its operation, it hit the latter, causing him to lose a finger. Who is liable for such loss?
a. Only the managing partner c. All the partners and the partnership solidarily
b. All the partners solidarily d. No one is liable
10. Partners Jun and Joy agreed that she will handle the sales and marketing departments of their partnership engaged in the grocery business
while he handle its human resource and warehouse departments. If he later sold its goods to customer Joe, such sale
a. Binds the partnership c. Does not bind the partnership if Joe knows what he handles
b. Does not bind the partnership d. Binds the partnership only if Joy approves it