REGULATORY FRAMEWORK FOR BUSINESS TRANSACTIONS

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1. At the annual meeting of the corporation for the election of the five directors, 4. In the required regular reports of the cooperative, the following shall be
A, B, C, D, E, F and G were nominated. A, B, C, D and E received the highest submitted to the authority except?
number of votes and thus proclaimed as elected. F received then (10) votes
less that E. Subsequently, E sold his shares to F. Who, between E and F has A. Performance Audit Report,
the right to attend as director? B. Compensation of board of directors
C. Audited Financial Statements
A. E is the director because his term is one year until his successor is D. Trainings Undertaken /Completed of listed officers
elected and qualified
B. F is the director because he has bought the shares of E
C. Both of them shall be directors Cooperative Code
D. Neither of them shall be director 5. The principle recognize by the state in the declaration of policy

A. Subsidiarity
2. Preemptive right refers to: B. Sustainability
C. Autonomy
A. The right of shareholders to share proportionately in dividends paid. D. Solidarity
B. The right of shareholders to share proportionately in any new stock
issues sold.
C. The right of shareholders to share proportionately in liquidated assets. 6. Responsible for overseeing periodic performance evaluation of the Board and
D. The right of shareholders to vote at annual shareholder meetings. its committees as well as executive management, and conducts an annual
E. None of the above. self-evaluation of its performance

A. Audit Committee
3. Preemptive right is __ B. Compliance officer
C. Corporate Governance Committee
A. Inherent right D. Executive committee
B. Imputed right
C. Statutory right
D. Common law right

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7. The roles and responsibilities of the Chairman include, among others, the 10. The following are the requirements before one can qualify as a de facto
following, except: corporation, except:

A. Guarantees that the Board receives accurate, timely, relevant, insightful, A. The existence of a valid law under which it may be incorporated.
concise, and clear information to enable it to make sound decisions B. An attempt in good faith to incorporate.
B. Facilitates discussions on key issues by fostering an environment C. Assumption of corporate powers.
conducive for constructive debate and leveraging on the skills and D. None of the foregoing.
expertise of individual directors
C. Determines the corporation’s strategic direction and formulates and
implements its strategic plan on the direction of the business 11. A contract of the corporation with one or more of its directors or trustees or
D. Ensures that the Board sufficiently challenges and inquires on reports officers
submitted and representations made by Management
A. Doctrine of double compensation
8. The CEO has the following roles and responsibilities, among others, except? B. Doctrine of self-dealing directors
C. Doctrine of corporate opportunity
A. Oversees the operations of the corporation and manages human and D. Doctrine of trust fund
financial resources in accordance with the strategic plan
B. Has a good working knowledge of the corporation’s industry and
market and keeps up-to-date with its core business purpose 12. The following are the limitations of an executive committee, except:
C. Directs, evaluates and guides the work of the key officers of the
corporation; A. Approval of any action for which shareholders' approval is also required.
D. Ensures that the Board sufficiently challenges and inquires on reports B. Filling of vacancies in the board.
submitted and representations made by Management C. Amendment or repeal of by-laws or the adoption of new by-laws.
D. Amendment or repeal of any resolution of the board.

9. Based on jurisprudence the following are deemed "statutory corporate

officers" of a private corporation, except 13. It is an agreement whereby a corporation delegates the management of its
affairs to another corporation for a certain period of time.
A. President
B. Corporate Secretary A. Management contract
C. Treasurer B. Voting trust agreement
D. Compliance Officer C. Contract of agency
D. Self-dealing contract

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14. It is a condition precedent in the acquisition of corporate existence. 18. In a private corporation, he/she is regard as the custodian of corporate
records
A. By-laws
B. Articles of incorporation A. Administrative Officer
C. Shares of stock B. Corporate Treasurer
D. Rules, regulation and discipline C. Corporate Secretary
D. Compliance Officer

15. The requirements for board meeting are the following, except: 19. The power to incur or create liabilities is an inherent power on the part of
business corporations
A. Meeting of the directors or trustees duly assembled as a Board.
B. Presence of the required quorum. A. True
C. Decision of the majority of all the members of the board only. B. False
D. Meeting at the place, time, and manner provided in the by-laws.
20. Statement 1 - By-laws provision cannot override provisions of the
Constitution, RCC, and other special laws.
16. It is defined by SEC as a person that directly or indirectly, through one or Statement 2 - By-laws provision can override or contravene the provisions
more intermediaries, controls or is controlled by, or is under common provided for in the Articles of Incorporation.
control with, the person specified through the ownership of voting shares, by
contract or otherwise. A. Both statements are True
B. Both statements are False
A. Associate C. Only Statement 1 is True
B. Subsidiary D. Only Statement 2 is True
C. Intermediary
D. Affiliate
21. The following acts or cases are considered Ultra-vires acts of a corporation,
except
17. The following are the Alter Ego cases in applying the doctrine of piercing the
veil of corporate fiction, except A. Acts done beyond the powers of the corporation as provided for in the
law or its Articles of Inc.
A. Tax avoidance cases B. Acts or contracts which are illegal per se being contrary to law
B. Under-Capitalization C. Acts entered into in behalf of the corporation by persons who have no
C. Tax evasion cases corporate authority
D. Forum-shopping D. None of the foregoing

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22. In strict corporate sense, the terms of corporate officers are not co-terminous A. Receivership
with that of the board B. Injunction if the act has not yet been done
C. Liquidation if abuse amounts to a ground for quo warranto but
A. True Solicitor General refuses to act
B. False D. Derivative suit or complaint filed with SEC (now the RTC)

23. The by-laws of the corporation cannot provide other 27. the acts of the purported corporate officer or agent justifying belief in the
qualifications and disqualifications in addition to those provided agency by the principal corporation is an application of:
in the Corporation Code.
A. Doctine of corporate opportunity
A. True B. Doctrine of apparent authority
B. False C. Doctrine of double compensation
D. Doctrine of piercing the veil

24. Ultra-vires act as distinguished from an illegal act for the ultra-vires act is
merely 28. An attribute of a corporation being described of having the capacity to
Contract and Transact Business
A. Void
B. Voidable A. Created by operation of law
C. Unenforceable B. Artificial being
D. Recissible C. Right of Succession
D. Has Powers, Attributes, & Properties expressly authorized by law or
incident to its existence
25. Unless otherwise provided by the articles of incorporation or the by-laws, a
member of a non-stock corporation may vote by proxy. 29. Shareholders are in legal sense the owners of corporate property or credit
which is owned by the corporation as a distinct legal person.
A. True
B. False A. True
B. False

26. The following are remedies available to stockholder in case of

mismanagement or abuse of power, EXCEPT:

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30. Statement 1 - Piercing is a power belonging to the court and cannot be 33. Rico is a laptop repair technician. A defective laptop was sold to him. He was
assumed improvidently able to fix. In its hardrive, he found a program which he used to develop
Statement 2 - Piercing the veil can be availed of by one who is not a "victim" FACELOOK. Later, Bob filed an action for damages on account of an
of a fraud or wrong infringement of copyright on the program which he owns. Rico raised as a
defense that he was unaware that what he used was a copyright material.
A. Both statements are True Rule on Rico's defense
B. Both statements are False
C. Only Statement 1 is True A. The defense is not valid. It is immaterial whether the infringer was
D. Only Statement 2 is True aware or not that the material he copied has a copyright.

B. The defense is not valid since there was bad faith when he copied the
31. Statement 1 - Non-Entitlement to Moral Damages of a Corporation is program considering that the laptop was only sold to him
absolute.
Statement 2 - A corporation can be held liable for torts committed by its C. The defense is valid since the computer program is an invention hence,
officers for corporate purpose. not covered by a copyright

A. Both Statements are True D. The defense is valid. Good faith can be used in this case since the laptop
B. Both Statements are False is already beyond repair when it was sold to him.
C. Only Statement 1 is True
D. Only Statement 2 is True
34. Angela and Miya are childhood friends. Events transpired which made Miya
obliged to give Angela a specific necklace, a specific car, or a specific doll.
They agreed that Angela will have the right to choose what will be given to
32. In a close corporation, The restrictions in the transfer of the stocks her. Before Angela made her choice, Miya drove the specific car and crashed
must appear in the following, except it to pieces by driving it at a speed of 120kph along a 40kph driving zone and
an hour after, lost the specific necklace by playing it in the Rizal Park like a
A. Articles of incorporation frisbee. Angela was so disappointed with Miya and she wants to enforce her
B. By-laws right. Which of the following describes the right of Angela?
C. Stock Certificates
D. Executive Committee resolution A. Angela may choose between the delivery of the specific doll or the price
of the specific necklace, the last thing that was lost, plus damages.

B. Since Miya can still deliver the specific doll, Angela can only choose the
specific doll.

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For O, it is basic that a limited partner is liable only up to the extent of
C. Since Miya already lost the confidence of Angela, Angela may choose the his capital contribution.
price of any of the prestations, plus damages.
C. Yes. The stipulation exempting P from losses is valid only among the
D. Angela may choose the delivery of the specific doll or either of the partners. L is liable because the agreement limiting his liability to his
price of the specific car or the price of the specific necklace. If Angela capital contribution is not valid insofar as the creditors are concerned.
will not choose the specific doll, Miya is liable for damages. Having taken part in the management of the partnership, O is liable as
capitalist partner.

35. In 2015, L, M, N, O and P formed a partnership. L, M and N were capitalist D. Yes. The stipulations exempting P and L from losses are not binding upon
partners who contributed P500,000 each, while O, a limited partner, the creditors. O is likewise liable because the partnership was not
contributed P1 ,000,000. P joined as an industrial partner, contributing only formed in accordance with the requirements of a limited partnership.
his services. The Articles of Partnership, registered with the Securities and
Exchange Commission, designated L and O as managing partners; L was liable
only to the extent of his capital contribution; and P was not liable for losses. 36. A, B, C and D are the solidary debtors of X for P40,000. X released D from the
payment of his share of P10,000. When the obligation became due and
In 2016, the partnership earned a net profit of P800,000. In the same year, P demandable, C turned out to be insolvent. Should the share of insolvent
engaged in a different business with the consent of all the partners. However, debtor C be divided only between the two other remaining debtors, A and B?
in 2017, the partnership incurred a net loss of P500,000. In 2018,the partners
dissolved the partnership. The proceeds of the sale of partnership assets A. Yes. Remission of D's share carries with it total extinguishment of his
were insufficient to settle its obligation. After liquidation, the partnership had obligation to the benefit of the solidary debtors.
an unpaid liability of P300,000.
B. Yes. The Civil Code recognizes remission as a mode of extinguishing an
Can the partnership creditors hold L, O and P liable after all the assets of the obligation. This clearly applies to D.
partnership are exhausted?
C. No. The rule is that gratuitous acts should be restrictively construed,
A. No. The Civil Code allows the partners to stipulate that a partner shall allowing only the least transmission of rights.
not be liable for losses. The registration of the Articles of Partnership
embodying such stipulations serves as constructive notice to the D. No. As the release of the share of one debtor would then increase the
partnership creditors. burden of the other debtors without their consent.

B. No. P is not liable because there is a valid stipulation exempting him

from losses. Since the other partners allowed him to engage in an
outside business activity, the stipulation absolving P from liability is valid.

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37. A obtained a loan of P300,000 from B payable on March25, 2012. As security is with C with balance of P4,000,000. How much is the maximum insured
for the payment of his loan, A constituted a mortgage on his residential house amount by PDIC from these deposits concerning A and B, respectively?
and lot in B's favor. C, a good friend of A, guaranteed and obligated himself to
pay B, in case A fails to pay his loan at maturity. If A sells his residential house A. P500,000 and P500,000 respectively
and lot to D, can B foreclose the real estate mortgage? B. P1,000,000 and P750,000 respectively
C. P1,000,000 and P1,000,000 respectively
A. Yes, B can foreclose the real estate mortgage. It is binding upon D as the D. P1,000,000 and P500,000 respectively
mortgage is embodied in a public instrument.

B. Yes, B can foreclose the real estate mortgage because real estate 40. It refers to the framework of rules, systems and processes in the corporation
mortgage creates a real right that attaches to the property. that governs the performance by the Board of Directors and Management of
their respective duties and responsibilities to the shareholders.
C. No, B cannot foreclose the real estate mortgage. To deprive the new
owner of ownership and possession is unjust and inequitable. A. By-Laws
B. Corporate Governance
D. No, B cannot foreclose the real estate mortgage. The sale confers C. Articles of Incorporation
ownership on the buyer D, who must therefore consent. D. Internal Control

38. The following are requisites in order that the obligor or debtor may be 41. A law was passed disqualifying former members of Congress from sitting in
considered in default, except: the Board of Directors of government owned or controlled corporations.
Because of this, the Board of Directors of ABC Corp, a government owned and
A. The obligation is demandable and already liquidated controlled corporation, disqualified C, a former Congressman, from
B. The obligor or debtor delays performance continuing to sit as one of its members. C objected, however, insisting that
C. The creditor requires the performance judicially or extrajudicially. under the Corporation Code, members of the board of directors of
D. None of the foregoing. corporations may only be removed by vote of shareholders’ holding 2/3
of its outstanding capital stock in a regular or special meeting called for that
39. A has two separate single bank accounts with P1,000,000 and P2,000,000 purpose. Is C correct?
balance, respectively in the same bank which is closed by BSP. B, on the other
hand, has two separate single bank accounts with P3,000,000 and P2,000,000 A. Yes, since the new law cannot be applied to members of the board of
balance, respectively with the said bank. Aside from that, A has two separate directors already elected prior to its passage.
joint accounts with different persons in the same bank. The first joint account
of A is with B with balance of P10,000,000 while the other joint account of A

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B. No, since the disqualification takes effect by operation of law and it is D. Optional fund
sufficient that C was declared no longer a member of the board.

C. Yes, since the provisions of the Corporation Code apply as well to 44. A reporter wants to write a true-to-life story about a person who was
government owned and controlled corporations. kidnapped and buried alive for 83 hours. The reporter then extensively
interviewed the survivor and spent several months coming up with a book
D. No, since the board has the power to oust C even without the new law. documenting the plight of the survivor. A Hollywood studio company then
made a movie out of the ordeal of the survivor. The reporter is saying that
even though the movie was not based on the book, the research he has spent
42. Which of the following is a ground for permanent disqualification of a documenting the event was copyrightable. Is the contention of the reporter
director of a corporation covered by Revised Code of Corporate Governance? correct?

A. Conviction by final judgment of an offense involving moral turpitude A. Yes, considering that the research material used served as the
such as fraud, estafa, theft, forgery bribery or perjury. foundation for the subsequent book of the reporter about the survivor.

B. Absence in more than fifty percent of all regular and special meetings of B. Yes, considering that the reporter has exerted substantial time and
the Board during his incumbency, or any twelve month period during effort in his research, it is copyrightable.
the said incumbency.
C. No, facts and research involved in obtaining facts should not be
C. If the beneficial equity ownership of an independent director in the distinguished, and are not copyrightable.
corporation or its subsidiaries and affiliates exceeds two percent of its
subscribed capital stock. D. No. the subject matter is not copyrightable.

D. Dismissal or termination for cause as director of any corporation

covered by this Code. 45. When a device appropriates a prior invention by incorporating its innovative
concept and, although with some modification and change, performs
substantially the same function in substantially the same way to achieve
43. It refers to the fund which is the first priority in the distribution of the net substantially the same result, what test should be applied?
surplus of the cooperative. It pertains to the fund to be used for the stability
of the cooperative and to meet net losses in its operations. A. Literal infringement test
B. Denicola test
A. Retained earnings C. Doctrine of Equivalents test
B. Reserve fund D. Fair Use test
C. Education and training fund

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46. Which of the following is in conformity with both law and jurisprudence? B. B. The corporation is de facto because although it has a certificate of
incorporation, the provisions in the resolution should have been
A. The separate personality of a corporation may be disregarded when an contained n the articles.
incorporator dominates and controls the outstanding capital stock.
C. C. The corporation is an open corporation. The corporation is a
B. Shareholders cannot maintain a suit in their own names to recover corporation by estoppel because although it operates as a corporation,
corporate property. it did not comply with certain legal requirements for the establishment
of a close corporation.
C. A corporation does not fall within the constitutional protection against
unreasonable searches and seizures. D. d. None of the foregoing.

D. A corporation has a right against self-incrimination.

48. Which of the following acts could be ratified by a vote representing at least
2/3 of the outstanding capital stock?
47. A corporation was formed by fifteen (15) incorporators and its certificate of
incorporation was duly issued. A year after its attainment of juridical A. Acts of directors or trustees who are guilty of gross negligence or bad
personality, the stockholders, who are themselves the members of the board faith in directing the affairs of the corporation;
adopted a resolution, providing for the following:
B. An attempt by a director to acquire or actual acquisition of any
(i) That all of the corporation’s issued stock of all classes, exclusive of interest adverse to that of the corporation in respect of any matter
treasury shares, shall be held of record by not more than a specified number reposed upon him in confidence;
of persons, not exceeding twenty (20);
C. Acts of directors constituting an approval of patently unlawful acts;
(ii) That all of the issued stock of the corporation shall be subject to certain
specified restrictions; and D. Acquisition of a business opportunity which should belong to the
corporation, thereby acquiring profits which should belong to the
(iii) That the corporation shall not list in any stock exchange or make any corporation.
public offering of any of its stocks of any class.

A. The corporation is a close corporation because the resolution contains

the elements of a close corporation;

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49. The following are the requisites for the corporate power to acquire its own 52. The following are remedies available to a corporation to enforce payment of
shares. Which is the exception? stocks except:

A. The corporation must have unrestricted earnings in its books to cover A. Extra-judicial sale
the purchase of the shares except in the case of redeemable shares. B. Withholding of stock dividends
C. Deduction from cash dividends
B. The acquisition must be for the sole purpose of acquiring shares in D. Mandamus
order to eliminate fractional shares.

C. The acquisition must be for a legitimate purpose. 53. A voting procedure wherein a stockholder is allowed to concentrate his
votes and give one candidate as many votes as the number of directors to
D. The corporation must have unrestricted earnings in its books to cover be elected multiplied by the number of his shares shall equal.
the purchase of shares.
A. Straight voting
B. Nominal voting
50. In the following cases, the Trust Fund Doctrine is violated, except: C. Special voting
D. Cumulative voting
A. When the corporation allows the issuance of watered stocks.
B. When there is payment of dividends without unrestricted retained
earnings. 54. In the event no new board is elected and qualified after the original one
C. When the corporation releases or condones payment of the unpaid year term of the board of directors, the existing board, if still constituting a
subscription. quorum, is still a legitimate board with full authority to bind the corporation
D. None of the foregoing. is known as:

A. Corporate opportunity doctrine

51. In the following instances, approval of the majority of the board and B. Emergency board
concurrence of the stockholders representing 2/3 of the outstanding capital C. Hold-over principle
stock is necessary in the exercise of the powers except: D. Doctrine of corporate contingency

A. To deny pre-emptive right.

B. To adopt, amend or repeal the by-laws. 55. What is the period for the exercise of right of redemption in case the
C. To increase or decrease capital stock. mortagee is a bank while the mortgagor is a juridical person
D. To declare stock dividends.
A. Within 30 days from the foreclosure of sale

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B. Within 1 month from the foreclosure of sale A. Yes, a third person who induced another to violate his contract shall be
C. Within a period of not less than 90 days but not more than 120 days liable for damages to the other contracting party.
from the foreclosure of sale
D. Within 3 months from the foreclosure of sale B. Yes, but Galaxy Cinema must also implead Jolina in its case against Wow
Films.
56. The theory adopted under Philippine jurisprudence as the underlying basis for
the existence and powers of corporate entities. C. No, because the exclusive contract is between Galaxy Cinema and
Kathreen only.
A. Theory of Corporate Business Enterprise
B. Genossenchaft Theory D. No, because Galaxy Cinema failed to prove how Wow Films got to know
C. Theory of Concession about the exclusivity provision.
D. Grandfather Rule

59. Innominate contracts shall be first regulated by:

(Source: Commentaries on the Revised Corporation Code by Dean C. L. Villanueva)
57. The following are deemed to be Statutory Corporate Officers, except A. The customs of the place
B. The provisions of Titles I and II of the New Civil Code
A. President C. The stipulations of the parties
B. Corporate Secretary D. The rules governing the most analogous nominate contracts
C. Treasurer
D. Compliance Officer
(Source: C. Villanueva)
60. Mr. Y owns 500 non-voting preference shares of ABC Corporation. In the
58. Kathreen, a popular actress, was under an exclusive contract with Galaxy Shareholders meeting, one of the agenda is to resolve the matter whether or
Cinema to star in 3 films the next 3 years. Such exclusivity prohibits Kathreen not the Corporation will consolidate with M Land, Inc. The corporate
from starring in any film produced by other film producers. During the secretary did not allow Mr. Y and the other preference shareholders to vote.
effectivityof the contract and knowing about the exclusivity provision. Wow Is the corporate secretary correct?
films induced Kathreen to star in a film produced by Wow films by giving her
thrice her compensation under her contract with Galaxy Cinema. Galaxy A. Yes, since Mr. Y owns non-voting shares hence he is not entitle to vote.
Cinema then sued Wow Films for damages on the ground that Kathreen
breached her exclusive contract. Is Wow Films liable to Galaxy Cinema for B. Yes, the corporate secretary has the authority to deny Mr. Y's voting
damages? rights under the Revised Corporation Code.

C. No, neither can Mr. Y exercise his appraisal right.

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64. Regulated entities shall have independent auditors accredited by the SEC
D. No, Mr. Y can vote on general matters affecting the affairs of the under the appropriate category, which of the following does not belong to
corporation. Group C category:

A. Financing companies
61. Per SEC MC No. 3-2018, Stock corporations shall file their General B. Lending companies
Information Sheet (GIS) within 30 days from: C. Investment companies
D. Transfer Agents
A. Date of actual annual stockholders meeting.
B. Date of authorization for issuance of financial statements.
C. Anniversary date of the issuance of SEC license. 65. When use in SRC Rule 68, it refers to a juridical person or a corporation
D. Date of approval of a resolution made by the Board of Directors. registered under the Corporation Code.

A. Subsidiary
62. Per SEC MC No. 3-2018, Non-stock corporations shall file their General B. Private corporation
Information Sheet (GIS) within 30 days from: C. Entity
D. Listed company
A. Date of authorization for issuance of financial statements.
B. Date of approval of a resolution made by the Board of Trustees. 66. What is the effect of a fortuitous event upon the term or period agreed
C. Anniversary date of issuance of SEC license. upon?
D. Date of actual annual members meeting.
A. It stops the running of the term or period agreed upon.

63. Per SEC MC No. 3-2018, Foreign corporations shall file their General B. It relieves the contracting parties from the fulfillment of their
Information Sheet (GIS) within 30 days from: respective obligations during the pendency of the event.

A. Date of actual annual stockholders meeting. C. It extinguishes the obligation.

B. Date of authorization for issuance of financial statements.
C. Anniversary date of the issuance of SEC license. D. It entitles the creditor to damages
D. Date of approval of a resolution made by the Board of
Directors/Trustees.

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67. It refers to ownership interest of third parties in property held by the debtor, 71. It is construed to mean an arrangement or understanding with the bank for
including those covered by trust receipts or assignments of receivables the payment of such check.
A. Loan
A. Possessory interest B. Order
B. Property interest C. Credit
C. Interest claim D. Note
D. Ownership interest

72. Statement 1 - When a check has been dishonored due to closed account,
68. How does the Anti-Money Laundering Council (AMLC) discharge its function? there is no violation of BP 22
Statement 2 - When a check has been dishonored due to a stop payment
A. Acting anonimously order, even if there is insufficiency of funds, there is no violation of BP22.
B. Acting unanimously
C. By majority vote of the AMLC A. Both Statements are True
D. Through the BSP Governor as its Chairman. B. Both Statements are False
C. Only Statement 1 is True
D. Only Statement 2 is True
69. Under the PDIC Law, a joint account held by a juridical person or entity jointly
with a natural person shall be presumed to belobg to the:
73. If the transaction is a covered transaction and at the same time, a suspicious
A. Natural person transaction, the covered institution shall report it as:
B. Both the juridical and natural persons
C. Juridical person A. Either a covered or suspicious transaction
D. One who first files the claim B. A covered transaction
C. A suspicious transaction
D. Depends on the discretion of the covered institution
70. The equity of redemption is available in which of the following credit
transactions?

A. Pledge 74. The right to a patent belongs to:

B. Real Estate Mortgage
C. Chattel Mortgage A. The inventor only
D. Both Real Estate and Chattel Mortgage B. The inventor and his heirs only
C. The inventor and his assigns only

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D. The inventor, his heirs, and his assigns
C. The making, drawing and issuance of a check payment of which is
refused by the drawee because of insufficient funds in or credit with
75. A cooperative is intended to be established with authorized capital stock of such bank, when presented within twenty (20) days from the date of the
P100,000 and actual subscribed capital stock of P40,000. What is the check.
minimum paid up capital of this proposed cooperative?
D. The making, drawing and issuance of a check payment of which
A. P5,000 is refused by the drawee because of insufficient funds in or credit
B. P10,000 with such bank, when presented within ninety (90) days from the date
C. P15,000 of the check.
D. P25,000

78. Which of the following is not an element of criminal violation of Batas

76. What is the amount of covered transaction in so far as jewelry dealers are Pambansa Bilang 22 for issuance of worthless checks?
concerned for purposes of reporting to Anti-Money Laundering Council?
A. There must be making, drawing, and issuance of any check to apply
A. A transaction exceeding P5,000,000 for account or for value.
B. A transaction exceeding P1,000,000
C. A transaction exceeding P500,000 B. There must be knowledge of the maker, drawer, or issuer that at
D. A transaction exceeding P100,000 the time of issue he does not have sufficient funds in or credit with
the drawee bank for the payment of the check in full upon its
presentment.
77. What is the prima facie evidence that the drawer of issuer of check has
knowledge that check he issued has insufficient fund? C. There must be intent to commit fraud upon the issuance of
worthless check.
A. The making, drawing and issuance of a check payment of which is
refused by the drawee because of insufficient funds in or credit with D. There must be subsequent dishonor of the check by the drawee
such bank, when presented within sixty (60) days from the date of the bank for insufficiency of funds or creditor dishonor for the same
check. reason had not the drawer, without any valid cause, ordered the
bank to stop payment.
B. The making, drawing and issuance of a check payment of which is
refused by the drawee because of insufficient funds in or credit with
such bank, when presented within thirty (30) days from the date of the
check.

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79. A, B and C are solidary debtors sharing at 1:2:3 of solidary creditors W and Y 81. It includes any important detail(s) that affects the tenor of the instrument or
sharing at 1:2. The obligation is P12,000. If B is a minor and C is insolvent the rights of the parties.
and W condones the obligation of A without the consent of Y, how much
can W collect from A? A. Material Alteration
B. Accomodation
A. P8,000 C. Material Particular
B. P6,000 D. Clearance
C. P4,000
D. P2,000
82. one where a corporation acquires all or substantially all of the properties of
another corporation in exchange of shares of stock of the acqurrrng
80. On April 1, 2018, A and B entered into a contract of corporation. The acquiring corporation would end up with the business
partnership for the purpose of selling cows’ milk, with the enterprise of the target corporation; whereas, the target corporation would
former as capitalist partner and the latter as industrial partner. end up with its shares in the acquiring corporation as its remaining assets.
It was agreed that A shall contribute 1,000 cows to the
common fund on May 2, 2018. Upon the arrival of the A. Consolidation
designated date, A failed to deliver the contribution he B. Acquisition
promised. As a result C. Liquidation
D. De facto merger
A. B should make a demand upon A for the delivery of
his contribution and its fruits to render A in default.
83. The following are the requisites of a derivative suit, except
B. The contract of partnership becomes void because A
failed to give his contribution to the common fund. A. No appraisal right is available
B. The suit is not a nuisance or harassment suit
C. B can compel A to deliver his contribution and its C. Existing cause of action in favor of the stockholders.
fruits without the necessity of demand. D. Action must be brought in the name of the corporation which must be
alleged
D. The contract of partnership was never perfected because
there was no delivery of contributions by the partners

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84. The following are the remedies of a stockholder who was denied of the right 88. Statement 1 - Directors are liable for a corporate act done pursuant to a valid
to inspect corporate books, except: corporate objective but later on became unfavorable to the corporation.
Statement 2 - As a rule, Directors and Officers are solidarily liable with the
A. Mandamus corporation.
B. Injunction
C. Damages A. Both statements are True
D. Criminal suit B. Both statements are False
C. Only statement 1 is True
D. Only statement 2 is True
85. The following may commit ultra vires acts, except:

A. The Corporation 89. Approval of stockholders is required before the Board of Directors can issue
B. The Board of Directors the unissued portion of the original authorized capital stock
C. The Corporate Officers
D. The Stockholders A. True
B. False

86. Statement 1 - The SEC's approval is required before there can be a sale or
disposition of all or substantially all of the corporate assets 90. The following are the corporate records required to be kept by the
Statement 2 - A shareholder can intervene in a suit involving corporate assets corporation, except:

A. Both Statements are True A. Books of account

B. Both Statements are False B. List of Stockholders or Members
C. Only Statement 1 is True C. Financial records
D. Only Statement 2 is True D. Corporation History and Background

87. It states that the transfer of all the assets of a corporation to another shall 91. When the conditions have been imposed with the intention of suspending
not render the latter liable to liabilities of the transferor. the efficacy of an obligation to give, which of the following rules shall not be
observed in case of the improvement, loss or deterioration of the thing
A. Trust Fund Doctrine during the pendency of the condition?
B. Nell Doctrine
C. Piercing the veil Doctrine A. If the thing is lost without the fault of the debtor, the obligation shall be
D. Jason Clause Doctrine extinguished.

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A. Right of person to demand compliance with an obligation must come
B. If the thing is lost through the fault of the debtor, he shall be obliged to from a source
pay damages; it is understood that the thing is lost when it perishes, or
goes out of commerce, or disappears in such a way that its existence is B. Contracts of adhesion are not invalid per se as they are binding as
unknown or it cannot be recovered. ordinary contracts

C. If it deteriorates through the fault of the debtor, the creditor may C. A condition shall be deemed fulfilled when the obligor voluntarily
choose between the rescission of the obligation and its fulfillment, with prevents its fulfillment.
indemnity for damages in either case.
D. Court condonation statutes being an act of liberality on the part of the
D. If the thing is improved by its nature, or by time, the improvement state are strictly construed against the government unless the laws
shall inure to the benefit of the debtor. themselves clearly state a contrary rule of interpretation.

92. The following statements reflects the correct legal principle, except: 94. Upon expiration of the period to redeem, the buyer in a foreclosure sale
becomes the absolute owner of the property hence he can be compelled to
A. Every person obliged to give something is also obliged to take care of it sell the subject property to specific persons without its consent.
with the proper diligence of a good father of a family, unless the law or
the stipulation of the parties requires another standard of care. A. TRUE
B. FALSE
B. The creditor has a right to the fruits of the thing from the time the
obligation to deliver it arises. However, he shall acquire no real right
over it until the same has been delivered to him. 95. Prima facie evidence is required to overturn the presumption of
consideration of a contract.
C. If the obligor delays, or has promised to deliver the same thing to two or
more persons who do not have the same interest, he shall be A. TRUE
responsible for any fortuitous event until he has effected the delivery. B. FALSE

D. The obligation to give a determinate thing includes that of delivering

all its accessions and accessories, provided that they are stipulated.

93. The following statement expresses the correct legal principle, except:

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96. Forgetfulness, without evidence that the same has removed from a person A. Both Statements are True
the ability to intelligently and firmly protect his property rights, will by itself B. Both Statements are False
incapacitate a person from entering into contracts. C. Only Statement 1 is True
D. Only Statement 2 is True
A. TRUE
B. FALSE

97. Applying the Law on trademark, which of the following terms are registrable?

A. Generic terms
B. Suggestive terms
C. Both Generic and Suggestive Terms are registrable
D. Neither Generic terms nor Suggestive terms are registrable

98. Statement 1 - A corporation may redeem a mortgage established prior to its

dissolution.
Statement 2 - If the mortgage was established after its dissolution, both the
mortgage and any redemption made on the basis of such mortgage are valid

A. Both Statements are True

B. Both Statements are False
C. Only Statement 1 is True
D. Only Statement 2 is true

99. Statement 1 - Transfer of stock of a close corporation made in breach of

qualifying conditions is void if all stockholders assented

Statement 2 - Total outstanding capital stocks, without distinction as to

disputed or undisputed shares of stock, is the basis in determining the
presence of quorum.

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