Diagnostic Examination

Obligations and Contracts, Partnership and Corporation

(Level 2)
FSUU - AIR
Name:__________________________ Date:______________ Score:___________

Instruction: In your answer sheet, shade the letter of the best

answer.

I. Obligations and Contracts

1. Which of the following is not an obligation with a period?

a. "Payable soonest"
b. An obligation payable little by little
c. Will pay you P10,000 "if I like"
d. Payable within 2 years from today
e. All of the above.

2. If an obligation is payable in foreign currency

a. the obligation is void.
b. the obligation is valid, but the stipulation is void.
c. the creditor can compel the debtor to pay in foreign currency as
per agreement
d. the stipulation and the obligation are void.

3. Which of the following statements is false?

a. The nullity of the principal carries with it that of the penal
clause.
b. Proof of actual damages suffered by the creditor is not necessary
in order that the penalty may be demanded.
c. I will pay you P10,000 "soonest" is for the benefit of the debtor.
d. Condonation is essentially gratuitous.

4. " I will give you my car one year after your death". The obligation
is
a. valid, because the event is sure to come.
b. valid, the obligation is conditional.
c. valid, but disregard the condition.
d. void, not legally possible.

5. A sold his cow to B for P2,500. No date was stipulated for the
delivery of the cow. While still in the possession of A, the cow gave
birth to a calf.
a. A is entitled to the calf because it was born before his obligation
to deliver the cow arises.
b. A is entitled to the calf as B has not paid the price.
c. B is entitled to the calf which was born after the perfection of
the contract.
d. B, in order to be entitled to the calf, should pay additional cost
for the calf to be agreed upon by both parties.

6. Statement # 1: The concurrence of more than one creditor or more

than one debtor in one and the same obligation implies solidarity.

Statement # 2: In alternative obligations where the right of

choice is exercised by the creditor, consent of the debtor as to the
creditor's choice of which prestation to perform his necessary.

a. both statements are true.

b. both statements are false.
c. statement no. 1 is true while statement no.2 is false.
d. statement no. 1 is false while statement no. 2 is true
7. The kind of compensation which may only be raised by the creditor
and not by the debtor in the obligation to give gratuitous support:
a. judicial compensation
b. conventional compensation
c. facultative compensation
d. legal compensation

8. Statement no. 1: Legal compensation takes place by operation of law

even if the parties may not be aware of it.

Statement no. 2: The indivisibility of an obligation necessary

implies solidarity.

a. both statements are true.

b. both statements ae false.
c. statement no. 1 is true while statement no. 2 is false
d. statement no. 1 is false while statement no. 2 is true.

9. Statement # 1: Responsibility arising from fraud is demandable in

all obligations. Any waiver of an action for future fraud is void.

Statement # 2: When the fulfillment of the condition depends upon

the sole will of the debtor, the conditional obligation shall be void.
If it depends upon chance or upon the will of a third person, the
obligation shall take effect in the conformity with the provisions of
laws.

a. both statements are true.

b. both statements are false.
c. no. 1 is false, no.2 is true
d. no. 1 is true, no. 2 is false

10. Statement no. 1: D oblige himself to give C a specific car

tomorrow. If D failed to deliver tomorrow after demand is made, C may
compel D to do his obligation and may ask for damages.

Statement no. 2: D oblige himself to deliver a car to C tomorrow.

If D failed to deliver tomorrow after demand is made, C's right is to
ask a third person to deliver a car to him at the expense of D plus
damages.

a. both are true.

b. both are false.
c. no. 1 is true, no. 2 is false
d. no. 1 is false, no. 2 is true

11. A person obliged to give something must preserve the object using
a standard of care or diligence. This standard of care or diligence
may be:
a. diligence provided by law
b. diligence provided by agreement of the parties
c. diligence of a good father of the family
d. any of the above

12. An obligation wherein various things are due but the complete
performance of all of them is necessary to extinguish the obligation.
a. facultative obligation
b. conjoint obligation
c. alternative obligation
d. pure compensation
13. D1, D2 and D3 are solidary debtors of C for P30,000. The
obligation was in writing. After the lapsed of the ten-year
prescriptive period, which of the following statement is incorrect.
a. If D1 paid C knowing that the obligation has already prescribed, D1
cannot ask reimbursement from D2 and D3.
b. If D1 paid C not knowing that the obligation has already
prescribed, D1 cannot ask reimbursement from D2 and D3.
c. If D1 paid C not knowing that the obligation has already
prescribed, his right is to proceed against C because there was undue
payment.
d. none of the above.

14. S owns specific ring and sells it to B for P10,000.B paid S the
price, and S promised to deliver the ring five days after. After the
sale, S gets a loan from X and pledged the ring in a private
instrument.

Statement #1: Between B and X, B has got a better title because the
pledge did not appear in a public instrument.

Statement #2: However, if S delivers the ring to X, X will have a

better title because there was delivery.

a. both are true.

b. both are false.
c. no. 1 is true, no. 2 is false.
d. no. 1 is false, no. 2 is true.

15. S sold to B a specific car for P10,000 and promised to deliver on

December 25, 2015. The next day after the sales is made, he sold the
same car to X and delivered it to X on the same day. If no delivery is
made by S to B on December 26,2015, which of the following is correct?

a. S is not in default because there was no demand.

b. B can cancel the contract between S and X because the contract of S
and B was perfected ahead of X.
c. S is liable to B for the value of the car plus damages.
d. S is in default, even if there was no demand. Hence, he will answer
for damages.

16. Change of persons or objects:

a. Confusion
b. Novation
c. Solution indebiti
d. none of the above

17. Statement # 1: In solution indebiti, the contract of the parties

is the basis for damages in case of non-performance.

Statement # 2: " Dolo", as a ground for awarding damages, is the

deliberate intention to cause damage or injury to another person.

a.both are true

b. both are false
c. no. 1 is true, no. 2 is false
d. no. 1 is false, no. 2 is true
18. Statement #1: " I will give you a specific car if you will not
marry X this year. If by the end of the year, both parties are alive
and no marriage has taken place, my obligation is extinguished.

Staement#2: "I will give you P10,000 if you cannot make a dead
man alive. This is an impossible obligation, obligation not
demandable.

a. both are true.

b. both are false.
c. no. 1 is true, no.2 is false
d. no. 1 is false, no.2 is true

19. A, B and C are joint debtors of joint creditors W,X,Y and Z in the
amount of P300,000. How much can W and X collet from B?
a. P75,000
b. P100,000
c. P150,000
d. none of the above

20. Which of the following is considered as quasi-contract?

a. solution indebiti
b. when the third person, without the knowledge of the debtor, pays
the debt
c. reimbursement due the person who saved property during fire or
storm without the knowledge of the owner.
d. all of the above.

21. Statement #1: The receipt of the principal obligation without

reservation as to the payment of interest shall raise a conclusive
presumption that the interest is also paid.

Statement #2: The receipt of the latter installment of a debt

without reservation as to prior installment, shall not raise a
conclusive presumption that the prior installment is also paid.

a. both are true.

b. both are false.
c. no. 1 is true, no. 2 is false
d. no. 1 is false, no. 2 is true.

22. Statement # 1: If the oligation does not fix a period but from its
nature and the circumstances, it can be inferred that a period was
intended, the court may fix the duration thereof . Once it is fixed by
the court the parties cannot change the fixed date for performance.

Statement #2: " I will give you p10,000 as soon as possible " This
is an obligation with a period for the benefit of both the debtor and
creditor.

a. both are true.

b. both are false.
c. no. 1 is true, no.2 is false
d. no. 1 is false, no. 2 is true.
23. Example no. 1: D obliged himself to give C P10,000. However, the
day before the obligation falls due, D's apartment was completely
gutted by accidental fire. There is no question that the money was
razed by fire. The obligation of D is totally extinguished because of
forfuitous event.

Example no. 2: D obliged himself to pay C P10,000 with 6%

interest. On the date, D tendered P10,000 with a promise to pay the
P600 interest the day after. If C refused to accept, he can be
compelled to accept the tendered payment because the obligation is
divisible.
a. both are true.
b. both are false
c. no. 1 is true, no. 2 is false
d. no. 1 is false, no. 2 is true

24. Example no. 1: D for P10,000 mortgaged his land to C. C instead of

a deed mortgage executed a deed of sale and let D sign his name. D's
right is to go to court and ask for annulment.

Example no. 2: D obliged himself to give object no.1 or object

no. 2 to C. In here, both objects are due.

a. both are true.

b. both are false.
c. no. 1 is true, no.2 is false
d. no. 1 is false, no.2 is true.

25. S owns an oil painting. Being in need of money, S sold the

painting to B for P1,000. After the sale, S discovered that the
painting was valuable and worth P5,000.
a. S may rescind the contract on the ground of lesion or inadequancy
of cause.
b. S may annul the contract on ground of fraud.
c. S may annul the contract on the ground of error.
d. B is entitled to the benefit of the contract because it is valid
and binding

26. Which of the following is not a requisite for the validity of a

contract?
a. Consent
b. Object
c. Cause or consideration
d. Delivery of the thing
e. None of the above

27. Before acceptance is conveyed, an offer becomes ineffective upon

the:
a. Death
b. Civil interdiction
c. Insanity
d. Insolvency of either party.
e. All of the above
28. X alleged that Y promised to give X one hectare of land. This is
in consideration of Y's meritorious services to Y. Y pleads in defense
that since the promise was not in writing, it is unenforceable under
the Statute of Frauds. Decide.

a. The promise is unenforceable because it is not in writing.

b. The Statute of Frauds is applied because A has rendered services
c. The Statute of Frauds is inapplicable here, because the promise to
give the land is not a sale of real property.
d. The Statute of Frauds can apply partially executed contract.

29. The stipulation in a contract to the effect that the debtor should
remain as a servant in the house and in the service of her creditor so
long as she had not paid her debt is void because it is:

a. contrary to good custom

b. contrary to public money
c. contrary to law and morality
d. none of the above.

30. X, after the death of his father, sold his inheritance though its
amount has not yet been determined to B, for a consideration of
P50,000.

a. The contract is valid only if the inheritance valued at least equal

or more than P50,000
b. The contract is rescissible.
c. The contract is valid even though nothing remains of the
inheritance to be turned over to B.
d. Contract is void, future inheritance cannot be the object of sale.

31. Which of the following contracts is void?

a. Those which object is outside the commerce of men.
b. Those which contemplate an impossible service.
c. Those where the intention of the parties relative to the principal
object of the contract cannot be ascertained.
d. Those expressly prohibited or declared void by law.
e. All of the above.

32. Statement no. 1: If the contract is entered into without authority

the contract is validable.
Statement no. 2: Contracts take effect only between the parties,
their assigns and heirs, except in case where the rights and
obligations arising from the contract are not transmissible by their
nature, or by stipulation or by provision of law. The heir is not
liable beyond the value of the property he received from the decedent.
a. both are true
b. both are false
c. no. 1 is true, no. 2 is false.
d. no. 1 is false, no. 2 is true

33. Reluctantly and against her good sense of judgment, Rosemarie

entered into a contract for the delivery of 5 tables to Corazon for a
price of P15,000. Contract is:
a. Void
b. Voidable
c. Unenforceable
d. Valid
34. G was appointed guardian of S, the latter being 16 years old. S
sold his parcel of land in writing to B valued at P100,000 for
P75,000, suffering lesion by 1/4 to the value. What is the status of
the contract?
a. Rescissible
b. Unenforceable
c. Enforceable
d. Voidable

35. What is the least defective contract?

a. Rescissible contract
b. Voidable contract
c. Unenforceable contract
d. Void contract

36. Which of the following contracts is not rescissible?

a. Those which are entered into by guardians whenever the wards whom
they represent suffer a lesion of more than 1/4 of the value of the
object of the contract.
b. Those executed in representation of an absentee, if the latter
suffer a lesion of more than 1/4 of the value of the object of the
contract.
c. Those where one of the parties is incapable of giving consent to a
contract.
d. Those undertaken in fraud of creditors when the latter cannot in
any other manner collect the claims due them.
e. Those which refer to things under litigation if they have been
entered into by the defendant without the knowledge and approval of
the litigants or of competent judicial authority.

37. Statement no. 1: The legal life of a contract begins from its
perfection stage. While the death of the contract is the performance
of fulfillment of the obligation.
Statement no. 2: Misrepresentation made in good faith is not
fraudulent but may constitute error and renders the contract voidable.

a. both are true.

b. both are false
c. no. 1 is true, no.2 is false
d. no.1 is false, no.2 is true

38. A contract where both parties are incapable of giving consent is:
a. Rescissible
b. Voidable
c. Unenforceable
d. Void
e. None of the above

39. Three of the following contracts are void. Which is the exception?
a. Those whose cause, object or purpose is contrary to law, morals,
good customs, public order or public policy.
b. Those which are absolutely simulated or fictitious.
c. Those which cause or object did not exist at the time of the
transaction.
d. Those where both parties are incapable of giving consent to a
contract.

40. S sold his car to B because of the intimidation of B.

a. S can ratify the contract
b. S can ratify the sale with the conformity of B
c. B has the right to ask for annulment
d. B has only four years to ask for annulment.
41. Three of the following are rescissible, which is not?
a. Sale of property under litigation made by defendant without the
knowledge of plaintiff and authority of the court.
b. Those made to defraud the creditors when the creditors has no other
means to recover his claim.
c. Those agreed upon in representation of absentees, if the absentee
suffers lesion by more than 1/4 of the value of the property subject
of the contract
d. none of the above

42.S an M agreed in print that, debtor for p3,000 will work as a

servant of M without pay until she could find money with which to pay
her debt. Meantime, S absconded her obligation and failed to comply
with her promise. Under this premise, which of the following
statements is correct?
a. The agreement to work as a servant is void because it is immoral
b. To act as a servant without pay is unconstitutional because this is
equivalent to involuntary servitude.
c. The obligation to pay is enforceable because this is in accordance
with law.
d. All of the above.

43. Which of the following contracts is not required to appear in a

public document?
a. Acts and contracts which have for their object the creation,
transmission, modification or extinguishment of real rights over
immovable property, sales of real property or of an interest.
b. The cession, repudiation or renunciation of hereditary rights
c. The power to administer property
d. Sale of immovable property
e. None of the above.

44. In order that a stipulation in favor of a third person in a

contract would be valid and binding upon the parties thereto, three of
the requisites are mentioned in the following enumeration. Which among
them is not a requisite?
a. There must be a stipulation in favor of a third person.
b. The contracting parties must have clearly and deliberately
conferred a favor upon that third person.
c. The third person communicated his acceptance to the obligor before
its revocation.
d. That there must be an existing agency between either of the
contracting parties and the third person.

45. A contract whereby the offeree is given by the offeror a certain

period of time within which to buy or not tp buy a certain thing for a
certain price is called:
a. Option contract
b. Contract of sale
c. Contract to sell
d. Barter

46. Which of the following statement is false?

a. Remission is essentially gratuitous
b. Cession is a special mode of payments
c. The liability of a guarantor is primary
d. In alternative obligations, the debtor is required to perform only
one prestation.
47. Which of the following is presumed not to be legal subordination?
a. When a creditor pays another creditor who is preferred
b. When a third person, not interested in obligation, pays with the
approval of the debtor
c. When a third person interested in the obligation, pays even without
the approval of the debtor
d. None of them

48. D is indebted to C for P10,000. For the purpose of defrauding C, D

sold his parcel of land to X valued P10,000. X had no knowledge of the
intention of D.
a. The contract between D and X is binding
b. The contract is voidable because D is in bad faith
c. The right of C is to rescind the contract because the transaction
is fraudulent
d. The contract between D and X is rescissible.

49. In order to defraud C, his creditor, D by means of force compelled

B to buy his D's land. B has no knowledge of such fact.
a. As to C, the contract is rescissible
b. As to B, the contract is voidable
c. Both a and b
d. none of a and b

50. The stage of "conception" of a contract is :

a. When the contract is fully executed
b. When the parties come to an agreement
c. When negotiations are in progress
d. When there is a meeting of the parties' minds

II. Partnership and Corporation

1. A, B and C are partners. Their contributions are as follows: A,

P60,000; B, P40,000; C,services. The partners did not agree on how to
divide profits and losses. If there is a loss of P10,000, how should
the said loss of P10,000 be shared by the partners?
a. A, P6,000;B,P4,000;C,nothing
b. A,P3,000;B,P2,000;C,P5,000
c. A,P3,500;B,3,500;C,P3,000
d. A,P3,500; B, P2,500; C, P4,000
e. None of the above

2. When the manner of management has not been agreed upon, who shall
manage the affairs of the partnership?
a. Capitalist partners
b. Industrial partners
c. Capitalist-industrialist partners
d. All of the partners
e. None of the above

3. As a general rule, a partner cannot ask for a formal accounting of

the affairs of the partnership during its existence and before it is
dissolved, except:
a. When he is wrongfully excluded from the partnership business.
b. When the right exists under the terms of any agreement.
c. As provided by Article 1807.
d. Whenever other circumstances render it just and reasonable.
e. All of the above.
4. A partnership is dissolved:
a. In contravention of the partnership agreement by the express will
of any partner at any time.
b. By any event which makes it unlawful or the business of the
partnership to be carried on or for the members to carry it on in
partnership.
c. When a specific thing which a partner had promised to contribute to
the partners perishes before its delivery to the partnership.
d. By the loss of the thing, whether before or after its delivery to
the partnership, when the partner who contributed it having reserved
the ownership thereof, has only transferred to the partnership the use
or enjoyment of the same.
e. All of the above.

5. A partnership is dissolved,except:(bonus)
a. By the death of any partner.
b. By the insolvency of any partner or of the partnership.
c. By the civil interdiction of any partner.
d. By the insanity of any partner.
e. All of the above.

6. On application by or for a partner the court shall decree a

dissolution whenever:
a. A partner becomes in any other way incapable of performing his part
of the partnership contract.
b. A partner has been guilty of such conduct as it tends to affect
prejudicially the carrying on the of the business.
c. A partner willfully or persistently commits a breach of the
partnership agreement that it is not reasonably practicable to carry
on the business in partnership with him.
d. The business of the partnership can only be carried on at a loss.
e. All of the above.

7. X, Y and Z are in partnership business. X contributed P10,000, Y

contributed P5,000 and Z his services only. After payment of
partnership debts, what remains of the partnership assets is P6,000
only. In the absence of terms to the contrary, the share of Z will be
equal to:(bonus)
a. That of Y
b. P2,000
c. That of X
d. Nothing

8. K is an industrial partner. Besides his services, he also

contributed capital to the partnership. There is no agreement or
stipulation as to the profits or losses. The share of K in the profit
is;
a. The remaining partners will determine his share in profits.
b. Combination of C and D below.
c. Such share as may be just and equitable under the circumstances.
d. Pro-rata to his contributions.
9. Three of the following enumerations are rights of a general partner
in a limited partnership which are also enjoyed by a limited partner.
Which among them is the exception?
a. To have the books of the partnership kept at the principal place of
business of the partnership, and at a reasonable hour to inspect and
copy any of them;
b. To have on demand true and full information of all things affecting
the partnership and a formal account of partnership affairs whenever
circumstances render it just and reasonable;
c. To have dissolution and winding up by decree of court;
d. To have all the rights and be subject to all the restrictions and
liabilities of a partner in a partnership without limited partners.

10. Every contract of partnership having a capital of P3,000 or more

in money or property shall eppear in a public instrument which must be
recorded in the Securities and Exchange Commission. Failure to comply
with said requirements;
a. Will not affect the liability of a partnership and the members
thereof to third persons.
b. Will render the partnership void.
c. Will not give the partnership a legal personality.
d. Will give the partnership a de facto existence.

11. A, B and C are partners in X company. D owes the partnership

P4,500. A, a partner, received from D a share of P1,500 ahead of
partners B and C, by giving D a receipt for his share only. When B and
C were collecting from D, the latter was already insolvent.
a. Partner A can be required to share the P1,500 with B and C.
b. A cannot be required to share the P1,500 with B and C.
c. B and C should exhaust first all remedies to collect from D.
d. B and C can deduct from the capital contribution of A in the
partnership, their respective share in the P1,500.

12. A partner whose connection with the partnership is open and

public, such as by including his name in the firm name of the
partnership is called:
a. Nominal partner
b. Ostensible partner
c. Secret partner
d. Dormant partner
e. None of the above

13. A partner who has no voice nor say in the management of the
affairs of the partnership is called:
a. Nominal partner
b. Secret partner
c. Silent partner
d. Dormant partner

14. A partner who does not participate in the management of the

affairs of the partnership and whose connection with it is not made
known to the public is called:
a. Ostensible partner
b. Secret partner
c. Silent partner
d. Dormant partner
e. None of the above
15. A person who, although not actually a partner, is made liable for
the debts of the partnership to third person by reason of his acts or
omissions is called:
a. Ostensible partner
b. Nominal partner
c. Silent partner
d. Dormant partner
e. None of the above

16. In three of the following instances, the certificate of a limited

partnership may be amended. Which is the exception?
a. Change in the character of the business.
b. There is a false or erroneous statement in the certificate.
c. Death of a general partner.
d. A person is substituted as a limited partner.

17. A partner who contributes money or property to the capital of the

partnership is called:
a. Industrial partner
b. Capitalist partner
c. Capitalist-industrial partner
d. Nominal partner
e. None of the above

18. A partner who contributes his work, labor or industry to the

common fund of the partnership is called:
a. Industrial partner
b. Capitalist partner
c. Capitalist-industrial partner
d. Ostensible partner
e. None of the above

19. A partner who contributes money or property as well as his work or

industry to the capital of the partnership is called:
a. industrial partner
b. capitalist partner
c. capitalist-industrial partner
d. managing partner
e. none of the above

20. A partnership having for its object determinate things, their use
of fruits, or a specific undertaking, or the exercise of a profession
or vocation is called:
a. partnership by estoppel
b. particular partnership
c. universal partnership of all present property
d. universal partnership of profits.
e. none of the above.

21. A partnership suffered losses in the first year of its operation.

X, a capitalist partner, cannot contribute an additional share to the
capital because of insolvency. Can X be obliged to sell his interest
to the other partners on the ground of such refusal?
a. Yes. X's refusal to contribute his additional share reflects his
lack of interest in the continuance of the partnership.
b. No, because there is actually no imminent loss of the business.
c. Yes, provided that X is paid the value of his interest.
d. No, because his refusal is justifiable.
22. A partner in a limited partnership cannot contribute:
a. Cash
b. Property
c. Services
d. Partly cash and partly property
e. None of the above

23. Which of the following is considered prima facie evidence of the

existence of a partnership?
a. Where payment of interest on a loan varies with the profits of the
business.
b. The receipts by a person of a share of the profits.
c. The sharing of gross returns of a business.
d. Where the parties are established as co-owners of a property.

24.A, B and C are partners. Their contributions are as as follows: A,

P60,000, B, P40,000, and C,services. The partners agreed to divide the
profits and losses in the following proportions: A, 35%; B, 25% and C,
40%. If there is a profit of P10,000,how should the said profits of
P10,000 be distributed among the partners?
a. A, P6,000; B, P4,000; C,nothing
b. A,P3,000; B, P2,000; C,P5,000
c. A, P3,500; B,P2,500; C,P4,000
d. A, P3,500; B, P3,500; C, P3,000
e. None of the above

25. A and B are partners, with A as the managing partner. D is

indebted to A in the amount of P10,000 and to the partnership in the
amount of P5,000. Both debts are due and demandable. D paid A P3,000.
A issued to D a receipt in his own name. How should the amount of
p3,000 be applied?
a. The P3,000 should be applied to the indebtedness of D to A.
b. The P3,000 should be applied to the indebtedness of D to the
partnership.
c. P2,000 should be applied to the indebtedness of D to the
partnership and P1,000 to the indebtedness of D to A.
d. P1,000 should be applied to the indebtedness of D to the
partnership and P2,000 to the indebtedness of D to A.
e. None of the above.

26. Partnership as distinguished from corporation

a. Acquires juridical personality upon approval by the SEC and
issuance of certificate
b. Has limited liability
c. Created by operation of law
d. No power of succession

27. Essential elements or feature of a partnership, except

a. Must have a lawful object or purpose
b. There must be a contribution of money, property or industry to a
common fund
c. With intention to divide and contribute whatever profits they make
to other people
d. Must be established for the common benefit or interest of the
partners
28. One of the following is not a characteristic of contract of
partnership
a. Real, in that the partners must deliver their contributions in
order for the partnership contract to be perfected
b. Principal, because it can stand by itself
c. Preparatory, because it is a means by which other contracts will be
entered into
d. Onerous, because the parties contribute money, property or industry
to the common fund

29. One of the following is not a requisite of a contract of

partnership. Which is it?
a. There must be a valid contract.
b. There must be a mutual contribution of money, property or industry
to a common fund
c. It is established for the common benefit of the partners which is
to obtain profits and divide the same among themselves
d. The articles are kept secret among the members

30. The minimum capital in money or property except when immovable

property or real rights thereto are contributed, that will require the
contract of partnership to be in a public instrument and be registered
with SEC
a. P5,000
b. P10,000
c. P3,000
d. P30,000

31. A and B entered into a universal partnership of all present

property. At the time of their agreement, A had a four-door apartment
which he inherited from his father 3 years earlier. B, on the other
hand, had a fishpond which he acquired by dacion en pago from C.
During the first year of the partnership, rentals collected on the
four-door apartment amounted to P480,000; while fish harvested from
the fishpond were sold for P300,000. During the same period, B
received by way of donation a vacant lot from an uncle. The partners
had a stipulation that future property shall belong to the
partnership. Which of the following does not belong to the common fund
of the partnership?
a. Fishpond
b. Rental of P480,000
c. Apartment
d. Vacant land

32. A and B entered into a universal partnership of profits. At the

time of execution of the articles of partnership, A had a two-door
apartment which he inherited from his father 3 years earlier. B on the
other hand, had a fleet of taxis which he purchased two years before.
In the first year of the partnership, A earned P500,000 as a radio
talent while B won P1,000,000 in the lotto. During the same period,
rentals of P120,000 were collected from the apartment, while fare
revenues of P200,000 were realized from the operation of the fleet of
taxis. Which of the following belongs to the partnership?
a. Two-door apartment
b. Lotto winnings of P1,000,000
c. Salary of P500,000
d. Fleet of taxis
33. A partnership formed for the exercise of a profession which is
duly registered is an example of
a. Universal partnership of profits
b. Universal partnership of all present property
c. Particular partnership
d. Partnership by estoppel

34. A, B and C are partners in CAB Enterprises. Not having established

yet their credit standing, the three partners requested D, a well-
known businessman, to help them negotiate a loan from E, a money
lender. With the consent of A, B and C, D represented himself as a
partner of CAB Enterprises. Thereafter, E granted a loan of P150,000
to CAB Enterprises. What kind of partner is D?
a. Managing partner
b. Liquidating partner
c. Ostensible partner
d. Partner by estoppel

35. A partner can engage in business for himself without the consent
of his co-partners if he is
a. A capitalist partner whether or not the business he will engage in
is of the same kind as or different from the partnership business
b. An industrial partner whether or not the business he will engage in
is of the same kind as or different from the partnership business
c. A capitalist partner and the business he will engage in is of a
kind different from the partnership business
d. An industrial partner and the business he will engage in is of a
kind different from the partnership business.

36. The partnership will bear the risk of loss of three of the
following things, except
a. Things contributed to be sold
b. Fungible things or those that cannot be kept without deteriorating
c. Non-fungible things contributed so that only their use and fruits
will be for the common benefit
d. Things brought and appraised in the inventory.

37. A partner's interest in the partnership is his share of the

profits and surplus which he may assign to a third person. Which of
the following statements concerning such right is correct?
a. The conveyance of a partner's interest will cause the dissolution
of the partnership
b. The assignee becomes a partner
c. The assignee has a right to interfere in the management of the
partnership business
d. The assignee has the right to receive the profits which the
assigning partner would otherwise be entitled thereto.

38. A partnership which comprises all the profits that the partners
may acquire by their work or industry during the existence of the
partnership is called:
a. Universal partnership of all present property
b. Universal partnership of profits
c. Particular partnership
d. Partnership at will
39. A partnership whereby the partners contribute to a common fund all
the property actually belonging to them at the time of the
constitution of the partnership, with the intention of dividing the
same among themselves, as well as the profits which they may acquire
therewith is:
a. Universal partnership of all present property
b. Universal partnership of profits
c. Particular partnership
d. Partnership at will

40. A partnership without a definite period of existence and which can

be dissolved at any time by any of the partners is called:
a. Universal partnership of all present property
b. Universal partnership of profits
c. Particular partnership
d. Partnership at will

41. Bears the risk of things contributed to the partnership

a. General partner
b. Limited partner
c. Partner contributing usufructuary rights over fungible things
d. Partner contributing usufructruary rights over non-fungible things

42. Instances when a partnership is unlawful, except

a. A partnership formed to furnish apartment houses which would be
used for prostitution
b. A partnership formed for the purpose of acquiring parcels of land
c. A partnership formed for gambling purposes
d. A partnership formed to create illegal monopolies or combinations
in restraint of trade

43. A and B orally agreed to form a partnership two years today, each
on to contribute P1,000. If at the arrival of the period, one refuses
to go ahead with the agreement, can the other enforce the agreement?
a. Yes, because the partnership contract is not governed by the
Statute of Frauds
b. Yes, because the prior agreement was voluntarily made
c. No, because the agreement was merely oral and executory
d. No, since the agreement is to be enforced after one year from the
making thereof, the same should be in a public instrument to be
enforceable

44. Where at least one partner is a general partner and the rest are
limited partners
a. General partnership
b. Partnership by estoppel
c. Partnership de facto
d. Limited partnership

45. Where all the partners are general partners

a. Partnership by estoppel
b. Limited partnership
c. Partnership de facto
d. General partnership
46. A, B, and C are partners each contributing P10,000. The firm's
indebtedness amounts to P90,000. It was stipulated that A would be
exempted from liability. Assuming that the capital of P30,000 is still
in the firm, which of the following is not correct?
a. The creditors may get the P30,000 and still collect each 20,000
from A, B and C.
b. A can recover P10,000 each from B and C should he (A) be required
to pay the creditors.
c. A cannot recover his original capital of P10,000.
d. The creditors can recover P45,000 each from B and C.

47. Maybe required to make additional contribution in case of imminent

loss:
a. Capitalist partner
b. Limited partner
c. Industrial partner
d. a,b and c

48. If the principal office of DNE Corporation is located at Cavite

City , stockholders' meeting can be held in
a. Manila
b. Cavite City
c. Valenzuela City
d. All of the above

49. If the principal office of DNE Corporation is located at

Valenzuela City , stockholders' meeting can be held in
a. Manila City
b. San Juan
c. Valenzuela City
d. All of the above

50. A form of combination where all the constituent corporations are

dissolved an out of them a new one is formed.
a. Consolidation
b. Merger
c. Joint venture
d. All of them

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