LAW 102 - PARTNERSHIP AND CORPORATION c.

There is no partnership because co-ownership by

(Reviewer) itself does not establish a partnership despite the
sharing of profits.
1. It is the change in the relation of the partners
caused by any partner ceasing to be associated in the d. There is partnership they being co- owners and co-
carrying on of the business. possessors.

a. Partnership liquidation 6. One of the following is not a characteristic of

contract of partnership.
b. Partnership dissolution
a. Onerous, because the parties contribute money,
c. Partnership termination property, industry to the common fund
d. Partnership incorporation b. Real, in that the partners must deliver their
contributions in order for the partnership contract to
2. Which of the following is not correct?
be perfected
a. A partnership begins from the moment of the
c. Preparatory, because it a means by which other
execution of the contract, unless it is otherwise
contracts will be entered into
stipulated.
d. Principal, because it can stand by itself
b. A particular partnership has for its objects
determinate things, their use or fruits, or a specific 7. The following persons are disqualified to form a
undertaking or the exercise of a profession or vocation. universal partnership, except
c. Persons who are prohibited from giving each other a. Those guilty of the same criminal offense, if the
any donation or advantage cannot enter into universal partnership is entered into in consideration of the same
partnership.
b. Those guilty of adultery and concubinage
d. Articles of universal partnership entered into without
specification of its nature, only constitute a universal c. Husband and wife
partnership of all present property.
d. Brother and sister
3. It is a partnership contract that comprises all that
the partners may acquire by their industry or work 8. A, B, C, D and E are partners in ABCDE Partnership
during the existence of the partnership. with capital contribution ratio of 5:4:3:2:1,
respectively. No one is appointed as managing partner
a. General partnership in Articles of Co-Partnership. The partners held a
meeting to determine its supplier. A and B voted in
b. Limited partnership favor of SM while C, D and E voted in favor of Ayala.
Who shall be considered the supplier of the
c. A universal partnership of profits
partnership?
d. Unlimited partnership
a. Ayala because it is the supplier selected by the
4. Every contract of partnership having a capital of majority of the partners.
three thousand pesos or more, in money or property,
b. SM because it is the supplier selected by the partners
shall appear in a public (notarized) instrument, which
having controlling interest
must be recorded in the
c. Both SM and Ayala because they are both selected by
a. Securities and Exchange Commission
the partners.
b. Department of Trade and Industry
d. Neither SM nor Ayala because selection of supplier
c. Officer of the Civil Registrar requires unanimity of the partners.

d. Register of Deeds 8. A stipulation which excludes one or more partners

from any shares in the profits or losses is
5. A and B are co- owners of a parcel of land from
which they derive profits in equal sharing being co- a. Voidable
heirs in inheritance. Is there a partnership?
b. Unenforceable
a. There is no partnership since in partnership division
c. Void
of profits is not always necessary among partners.
d. Valid
b. There is a partnership because of the equal sharing
of profits. 9. The change in the relation of the partners caused by
a partner ceasing to be associated in the carrying on
of business. d. The sum collected shall be applied to the partnership
credit
a. Withdrawal
14. Three lawyers formed a law partnership. The
b. Dissolution senior and well-known partner died. Can they still
continue using the name of such deceased partner?
c. Termination of partnership
a. No, as the partnership has been dissolved.
d. Winding-up
b. Yes, as long as they will put some mark in that name
10. Partners A,B, and C contributed: A-P1M; B-P2M;
indicating that such partner is already deceased.
and C-service. After exhausting the partnership assets,
the creditors still have a claim for P.3M. For how much c. Yes, since he was a partner.
are the partners liable to the creditors for the
partnership liability? d. No, as he is already excluded from the partnership.

a. Only A and B are liable equally to the creditors being 15. In case of an imminent loss of the business of the
capitalists. partnership, which partner is not liable to contribute
an additional share to the capital of the partnership in
b. C is not liable an industrial partner who is exempt order to save the business?
from losses.
a. managing partner
c. Only A and B are liable at 1/3 and 2/3 respectively.
b. capitalist partner
d. All of A, B, and C are liable pro rata to the creditors.
c. limited partner
11. Which of the following has no right to inspect the
books of the partnership? d. industrial partner

a. limited partner 16. Jane, Erik and Matet are partners in buying and
selling cars. Jane, by the partners agreement, was
b. nominal partner authorized to buy only in cash. One day, Jane bought
on credit a car from Joanne, a client, who did not
c. dormant partner
know of Janes lack of authority. Janes purchase was
d. secret partner made in the name of the partnership. Is the
partnership bound in the sale?
12. A, B and C are partners each contributing P10,000.
The firm’s indebtedness amounts to P90,000. It was a. It is bound if it ratifies the contract of sale by
stipulated that A would be exempted from liability. acceptance of benefits.
Assuming that the capital of P30,000 is still in the firm,
b. It is not bound because the contract with Joanne is
which of the following is not correct?
not in the ordinary course of business.
a. A cannot recover his original capital of P10,000.
c. It is bound because Joanne was in good faith and the
b. The creditors may get the P30,000 and still collect act of Jane was apparently in the conduct of the
each 20,000 from A, B and C. business.

c. A can recover P10,000 each from B and C should he d. The partnership is not bound because the contract is
(A) be required to pay the creditors. unenforceable, Jane exceeded his authority.

d. The creditors can recover P45,000 each from B and 17. A partnership which comprises all the profits that
C. the partners may acquire by their work or industry
during the existence of the partnership is called:
13. The following are the rules in case a managing
partner collects a demandable debt from a person a. Universal partnership of all present property
who also owes the partnership a demand debt, except
b. Particular partnership
a. It shall be applied to the two credits in proportion to
c. Partnership at will
their amounts
d. Universal partnership of profits
b. The debtor has the right to have the payment
applied in his debt to the partner if it should be more
onerous to him
18. The minimum capital in money or property except
c. The sum shall be fully applied to the partnership when immovable property or real rights thereto are
credit, if the receipt given is for the account of the contributed, that will require the contract of
partnership. partnership to be in public instrument and be
registered with SEC partner who has died or has assigned his interest in
the partnership is known as
a. 30,000
a. A general-limited partner
b. 5,000
b. A liquidating partner
c. 10,000
c. An ostensible partner
d. 3,000
d. A substituted limited partner
19. Essential elements or feature of a partnership,
except 23. In general , to show the existence of a partnership,
three of the following characteristics must be proved.
a. Must be established for the common benefit or Which is the exception?
interest of the partners
a. There was a joint interest in the profits.
b. Must have a lawful object or purpose
b. There was an agreement in writing.
c. With intention to divide and contribute whatever
profits they make to other people c. There was a common or joint fund obtained from
contributions.
d. There must be a contribution of money, property or
industry to a common fund d. There was an intention to create a partnership.

20. A and B entered into a universal partnership of all 24. Which of the following is not a prohibition on a
present property. The common property of the limited partner?
partnership shall be
a. Limited partner may not take part in the control of
a. All the properties which shall belong to each of the the business. 
partners after the constitution of the partnership
b. Limited partner may not contribute service. 
b. All the properties which belonged to each of the
partners at the time of the constitution of the c. Surname of a limited partner may not appear in the
partnership as well as the properties which each may partnership name. 
acquire thereafter.
d. Limited partner may not constitute his assignee as
c. All the properties which belonged to each of the substituted limited partner.
partners at the time of the constitution of the
25. A partnership which comprises all the profits that
partnership as well as the profits which they may
the partners may acquire by their work or industry
acquire therewith
during the existence of the partnership is called:
d. All the properties which belonged to each of the
a Universal partnership of all present property
partners at the time of the constitution of the
partnership b. Universal partnership of profits
21. A,B and C entered into an oral contract of c. Particular partnership
partnership each contributing P1M each to the
common fund plus other personal properties of the d. Partnership at will
same amount and failed to register the partnership
with the SEC. Is the partnership valid? 26. A and B put up a partnership to engage in
distribution of books and school supplies. A
a. Yes, because a partnership contract can always be contributed P1M while B his services. A wants to put
oral. up a restaurant on the opposite side of the street. On
the other hand, B wants to have a bakery beside A’s
b. No, because registration with the SEC is essential for restaurant. Which of the following is correct?
a partnership to be valid and acquire juridical
personality. a. B may put up his bakery without need of securing A’s
consent
c. Yes, because public instrument is necessary only in
case of contributions of immovable. b. Neither A nor B can put up another business

d. No, because every contract of partnership having a c. Both A and B can put up their restaurant and bakery
capital of three thousand pesos or more in money or businesses without the need of securing each other’s
property must be in public instrument and registered consent
with the SEC.
d. A may put up his restaurant without need of securing
22. A person admitted to all the rights of a limited B’s consent
27. Which of the following claims shall be paid last in reach of corporate directors
the liquidation of general partnership?
32. A corporation created in strict compliance with
a. Those owing to partners other than capital and all the legal requirements and whose right to exist as
profits. a corporation cannot be successfully attacked in a
direct proceeding for that purpose by the State is? *
b. Those owing to partners in respect of profits.

c. Those owing to partners in respect of capital A. Corporation by prescription

B. Corporation by estoppel
d. Those owing to the creditors other than partners C. De facto corporation
28. Which of the following is not correct about D. De jure corporation
partners right over specific partnership property?
33. A certificate of stock is distinguished from share
a. A partners right in specific partnership property is of stock in that a share of stock *
not subject to legal support.
A. is the written evidence of a stockholder's interest
b. A partners right in specific partnership property is
in the assets and management of a corporation
not subject to attachment or execution even on a claim
B. is tangible personal property
against the partnership
C. is one of the units into which the capital stock is
c. A partner is co-owner with his partners of specific divided
partnership property. D. may not be issued if the subscription has not been
duly paid
d. A partners right in specific partnership property is
not assignable. 34. Corporations as distinguished from partnership *
A. the liability extends up to private properties
29. A, B and C are equal partners in ABC Partnership.
B. created by agreement
On April 29, 2011, C died. Not knowing that C is dead,
C. interest or ownership is transferable only if the
on May 2, 2011, A contracted a liability to D who also
other owners consent
did not know about the death of C. the liability is
D. no dissolution in case of death, withdrawal or
P90,000. After D exhausted the net assets of the
resignation of an owner
partnership in the amount of P60,000, he can collect

a. P30,000 from A or P30,000 from B

35. This is a characteristic of a stock corporation as
b. P30,000 from the estate of C or P30,000 from B or distinguished from a non-stock corporation *
P30,000 from C
A. The powers are vested in the Board
c. P10,000 from the estate of C, P10,000 from A and B. The owners can declare dividends
P10,000 from B C. It is formed by at least 5 but not more than 15
persons
d. P15,000 from A and P15,000 from B D. It is organized for profit

36. This is a feature of a non-stock corporation as

CORPORATION distinguished from a stock corporation *

30. Under this theory, the nationality of the A. The owners are liable only up to the extent of their
corporation is that of the country under whose laws investment
it was formed B. The owners are not entitled to dividends unless
declared by Board
A. Control test C. Its income shall be used only for the furtherance of
B. Incorporation test the purpose for which it was organized
C. Domicile test D. Straight on cumulative voting may be used in
D. Grandfather rule choosing the members of the Board

37. The articles of incorporation differ from the by-

31. Stock dividends differ from cash dividend in that
laws in that the articles of incorporation are *
stock dividends *
A. Do not increase the legal capital
A. The rules of action adopted by a corporation for its
B. Involve the disbursement of corporate funds
internal government
C. Require the approval of both the board of directors
B. Adopted before or after incorporation
and the stockholders
C. A condition precedent in the acquisition by a
D. Once received by the stockholders, are beyond the
corporation of a juridical personality C. Only the first is true
D. Approved by stockholders if adopted after the D. Only the second is true
incorporation
43. A non-voting stock may vote in the following
38. The following may be the consideration of the corporate acts, except in case of *
shares or stock of a corporation, except *
A. approval of the compensation of directors
A. actual cash paid to the corporation B. merger or consolidation
B. Previously incurred indebtedness to the C. increase or decrease in capital stock
corporation D. sale, lease, exchange, mortgage, pledge or other
C. amounts transferred from unrestricted retained disposition of all or substantially all of corporate
earnings property
D. services to be performed by a lawyer on the
proposed increase in capital stock of the corporation 44. Rules of action adopted by the corporation for its
internal government and for the government of its
39. I - All incorporators are corporators and all officers and of its stockholders and members *
corporators are incorporators;
II - Banks, trust companies, insurance companies, A. Contract
public utilities and building and loan associations B. Articles of Incorporation
may have a par value or may have no par value as C. Ultra-vires acts
may be provided for in the articles of incorporation * D. By-laws

A. Both are true 45. Dividend which are actually distributions of

B. Both are false assets of the corporation upon dissolution or winding
C. Only the first is true up *
D. Only the second is true
A. bond dividend
40. I - Shares with par value may not be issued for a B. preferred dividend
consideration less than the value of P5 per share; C. cumulative dividend
II - Preferred shares of stocks may be issued with D. liquidating dividend
or without a stated par value *
46. Cash dividends as distinguished from stock
A. Both are true dividends *
B. Both are false
C. Only the first is true A. needs stockholder's approval
D. Only the second is true B. declared by the board of directors
C. not a taxable income
41. I - Shares issued without par value shall be D. results to withdrawal of assets from the
deemed fully paid and non-assessable and the holder corporation
of such shares shall not be liable to the corporation
or its creditors in respect thereto; 47. I - When par value shares are issued above par,
II - first statement means that the holder is no the premium or excess is to be considered as part of
longer liable for the shares even if they are not yet the legal capital;
fully paid. * II - In the case of no par value shares, the entire
consideration received forms part of legal capital and
A. Both are true shall be available for distribution as dividends.
B. Both are false
C. Only the first is true A. Both are true
D. Only the second is true B. Both are false
C. Only the first is true
42. I - Redeemable shares may be redeemed D. Only the second is true
regardless of the existence of unrestricted retained
earnings even if such redemption would cause 48. I - There is merger when two or more
insolvency or inability of the corporation to meet its corporations unite giving rise to a new corporate
debts as they mature; body and dissolving the constituent corporations;
II - Treasury shares do not revert to the II - There is consolidation when two or more
unissued shares of the corporation and are still corporations unite, one corporation loses its
issued shares but being in the treasury they have the corporate existence absorbing in itself the other
status of outstanding shares. * which disappears as a separate corporation. *

A. Both are true A. Both are true

B. Both are false B. Both are false
C. Only the first is true B. Trust fund doctrine
D. Only the second is true C. Doctrine of corporate opportunity
D. Doctrine of limited capacity
49. If the corporation has commenced the
transaction of its business, the corporate franchise or 55. A corporation has only such powers as are
certificate of incorporation may be suspended or expressly granted and those that are necessarily
revoked, it if subsequently becomes continuously implied from those expressly granted or those which
inoperative for a period of at least * are incidental to its existence *

A. 4 years A. Doctrine of corporate fiction

B. 3 years B. Trust fund doctrine
C. 2 years C. Doctrine of corporate opportunity
D. 5 years D. Doctrine of limited capacity

50. The corporation shall be deemed dissolved and 56. A corporate officer or director cannot take
its corporate power cease, if from the date of its advantage for their personal benefit a business
incorporation, it does not formally organize and opportunity which the corporation is financially able
commence the transaction of its business or the to undertake *
construction of its works within *
A. Doctrine of corporate fiction
A. 4 years B. Trust fund doctrine
B. 3 years C. Doctrine of corporate opportunity
C. 2 years D. Doctrine of limited capacity
D. 5 years
57. Each incorporator of a stock corporation must
51. May rightfully question an ultra-vires act of a own or be a subscriber to at least *
corporation, except *
A. one share of the capital stock
A. Stockholders B. five shares of the capital stock
B. State C. ten shares of the capital stock
C. Competitors D. fifty shares of the capital stock
D. Creditors, if fraud is charged
58. Corporations being to have corporate existence
52. The veil of corporate fiction may be pierced in and juridical personality *
the following cases, except *
A. from the moment of the execution of the Articles
A. when used as a cloak to cover fraud, illegality, or it of Incorporation
results in injustice B. from the moment of the execution of the
B. to defeat public convenience, justify wrong, defend Constitution and by-laws
crime C. from the moment of the execution of the
C. when two factories are made to appear as one and Treasurer's affidavit
used as a device to defeat the ends of law or as a D. from the date of the issuance of the certificate of
shield to confuse legitimate issues incorporation by the SEC under its official seal
D. where two corporations have the same president E. from the date the stockholders and BOD's/BOT's
stipulated

53. As regards treasury shares, which is not correct? 59. Shares without par value may not be issued for a
A. they have no voting rights as long as they remain in consideration of *
the treasury
B. they are considered as part of earned or surplus A. less than P1 per share
profits and therefore distributable as dividends B. less than P5 per share
C. they are not entitled to dividends of assets C. outstanding capital stock
D. they may be distributed as property dividend if D. less than P100 per share
there are retained earnings arising from the business
of the corporations
54. The assets of the corporation as represented by 60. Which statement is incorrect? *
its capital stock are to be maintained unimpaired
that there can be no distribution of such assets A. If all actual partners of an existing partnership
among stockholders without provision being first consented the representation of a person as part of
made for the payment of corporate debts * partnership even though he's not become liable to
third persons who rely on his representation
A. Doctrine of corporate fiction B. A person not a partner in an existing partnership
will be treated as a partner because of the concept of
estoppel for the purpose to hold him liable to 66. Papasaka company, a partnership engaged in the
innocent third persons whom he represented himself trading business, has for its members and their
as part of the partnership respective contributions the following:
C. If not all partners of existing partnership consent Pressuredsiako P10, 000, Itreallyhurts P20,
ostensible partner to represent himself as part of 000,Lalabanpa P50, 000, Chillaxlang P40, 000 and
partnership, the partnership is still liable to the Goforthegoal P40,000. In the course of the
injured third person partnership's operations, Itreallyhurts propose to
D. Injured innocent third person with whom the buy books from Risakawaam but was opposed by
alleged partner contracted must show that the Pressuredsiako together with Goforthegoal and
purported partner represents him as a partner and Chillaxlang while Lalabanpa sided with Itreallyhurts.
dealt with partnership to his injury by relying in the *
representation.
A. The decision of Itreallyhurts and Lalabanpa will
61. The death of a partner will require that all prevail because they constitute the controlling
noncash assets are sold for cash, all liabilities are interests
paid, and remaining cash be distributed to the estate B. Pressuredsiako, Gorforthegoal and Chillaxlang's
of the dead partner on the basis of the partnership group will prevail because they constitute the
income and loss agreement. * majority
C. No group will prevail because the other
a. True comstitutes the controlling interests while the other
b. False constitutes the majority
D. All of the above
62. Which of the following is not a requirement for
formation of limited partnership? * 67. These are order of priority of payment of
liabilities upon liquidation *
A. The character of business
B. The term for which the partnership is non A. Outside Creditors; Inside Creditors; Those to the
existence partners in respect of profits; Those to the partners in
C. The location of the place of business respect of Capital.
D. The time, if agreed upon, when the contribution of B. Outside Creditors; Inside Creditors; Those to the
each limited partners is to be returned partners in respect of Capital; Those to the partners
in respect of profits
63. Exempting a partner from Pro rata and Subsidiary C. Those to the partners in respect of profits; Those
liability after the exhaustion of partnership asset. * to the partners in respect of Capital; Inside Creditors;
Outside Creditors
A. Valid as to third Person. D. Those to the partners in respect of profits; Those
B. Valid as to Law. to the partners in respect of Capital; Outside
C. Void as to third Person. Creditors; Inside Creditors.
D. Void among Partners.
68. Which of the following may wind up a
64. Which of the following kind of partners allowed partnership affair? *
his name to be included in the firm name? *
A. Extra-judicially and Judicially
A. Secret partner B. Tulfo in Action
B. Silent partner C. Face to face
C. Dormant partner D. Online and Modular
D. Ostensible partner E. Secret di ko sasabihin

65. All of the following are the requisites for the 69. TuraKyut, debtor, pledged her share of profits to
return of the erroneously contribution by a limited GerasmiaKyut, creditor, hence as stated in Article
partner except * 1804, Gerasmia can now intervene with the
management and administration of the partnership.

A. All liabilities of the partner have not been paid. A. True

B. The consent of all the partners (general and B. False
limited) has been obtained unless the return of the
contribution may be rightfully demanded. 70. Julie and Angel is a partnership engaged in the
C. The certificate is cancelled or so amended to set Coffee Shop business which is operated by friends
forth the withdrawal or reduction. Kendra and Albert. The Coffee Shop is located on a
D. All of the choices are requisites. lot which Kendra and Kendra leased from Jhessa at
15% of the yearly gross income of the business. Faith latter's interest in the partnership.
was hired as accountant at a monthly salary P B. Redemption of interest charged with the
15,000.00 plus 3% of the yearly net profit as bonus. partnership property.
Who are the partners in the business? * C. Interest charged may be redeemed with the
separate property of any general partner.
A. Kendra and Albert D. Both A and C
B. Kendra and Jhessa
C. Julie, Angel and Kendra since all of them receive a 76. Exempting the third person from pro rata and
share in the net profits subsidiary liability after the exhaustion of
D. Julie and Angel partnership assets is valid. *

71. Partner Georgin is obliged to the following, A. Yes, because he knows who are the solvent and
except. * insolvent partners
B. No, because the important for him is only the
A. He is obliged to deliver the amount of money or receivable which is his main objective
the property at the time it was constituted or on the C. Yes, because he knows who are the solvent
date of stipulation. partners and he can assure that those receivable will
B. He is obliged to reimburse the amount he has be collected from them
taken from the partnership coffers. D. No, because he is not part of the partnership
C. He is obliged to contribute equally to the capital of
the partnership. 77. General partners are liable. *
D. He is obliged to bear the risk of specific things
owned by him which are fungible. A. For debts of the partnership personally for their
portion of the partnership debts.
B. For debts of the partnership only to the extent of
72. The character of notice required to relieve the their contribution to the partnership and only for
retiring partner or the representative of the their portion of the partnership debts
deceased partner from subsequent partnership C. For all of the partnerships debts personally
obligations as to prior dealers should be: * D. All of them.
A. Advertisement in local newspaper
78. The obligations of partners with respect to
B. Actual notice
amount appropriated, which is not TRUE: *
C. Either of the two
D. None of the above
A. To reimburse to the partnership the amount that
he has taken from the partnership coffers.
73. Which of the following is incorrect? *
B. To pay interest on the amount he had converted
for his own use from the time of conversion
A. Ma. Shiena become a member of the partnership
C. To pay damages suffered by the partnership by
with the consent of the other associates.
reason of the conversion
B. Ma. Shiena as a limited partner contributed cash in
D. To be liable for damages in case of default
the amount of ₱1,500.
C. Ma. Shiena contributed land in the partnership.
The inventory of the said property was made and 79. The following are obligation of the partnership to
signed by the parties and the partnership contract the partners except: *
was not placed in a public instrument.
D. Both a and b. A. To pay for the things in which the partner
performed for his own interest during the partnership
74. YG is authorized to collect the credits of TXT B. To pay to the partner any amounts he may have
partnership. Kai, third person with no knowledge of disbursed for the partnership with interest from the
the authority, paid SB, partner of partnership, time the expenses were made.
P10kpayment of his debt to partnership. Sb issued a C. To pay for the obligations which a partner may
TXT partnership receipt, later turn-over the collected have contracted in good faith in the interest of the
amount to YG. The transaction is acceptable despite partnership business.
SB’s lack of authority. * D. To answer for risks in consequence of its
management.

A. True
B. False PARTNERSHIP

75. Which is true in charging of limited partner's

interest? * 80. An artificial person like a corporation, may be a
partner in a partnership. *
A. The creditor of a limited partner may charge the
A. True
B. False
89. Articles of universal partnership entered into
without specification of its nature, only constitute a
81. All partners including industrial ones shall be universal partnership of all present property. *
liable pro-rata with all their separate property after
the partnership assets have been exhausted. * A. True
B. False
A. True
B. False
90. Which is incorrect? *

82. A limited partner may contribute money and/or A. A - cash (Ltd.); B - cash (Gen.); C - service (Gen.)
property to a partnership but not services. * B. A - property (Ltd.); B - cash (Gen.); C - service
(Gen.)
A. True C. A - service (Ltd.); B - cash (Gen.); C - service (Gen.)
B. False D. A - cash (Ltd.); B - property (Gen.); C - service
(Gen.)

83. An industrial partner can engage in business for

himself if it is of a kind different from the partnership 91. A and B agreed on a profit sharing ratio in their
business even without the consent of the other partnership. A, being the industrial partner and B as
partners. * capitalist partner. It was also stipulated that A shall
also share in the same ratio as to the losses. Is A
A. True liable for losses? *
B. False
A. No, because the law exempts the industrial partner
84. When a partner has been appointed manager in from losses.
the articles of partnership, he may be removed B. No, because the partners cannot stipulate that the
without just cause by the vote of the partner owning industrial shall be liable for losses.
the controlling interest. * C. Yes, even in the absence of stipulation.
D. Yes, because it was so stipulated.
A. True
B. False
92. A and B entered into a universal partnership of all
85. A stipulation exempting a capitalist partner from present property. Subsequently, A inherited a parcel
losses is valid. * of land from his father. Will the land and its fruits
belong to the partnership? *
A. True
B. False A. Yes, because universal partnership means
contribution of all properties, present and future
86. The profits and losses of the partnership shall be
divided equally among the partners if they have no B. No, because the land and the fruits are future
profit and loss sharing agreement. * properties, not existing at the time of the celebration
of contract.
A. True
B. False C. No, even if so stipulated, both as to fruits and the
land
87. Spouses can validly enter into a particular
D. Yes, if there was stipulation that the land to be
partnership with each other. *
inherited shall be considered contributed
A. Yes
93. A and B entered into a universal partnership of
B. No
profits. Subsequently, A became a professor in a
C. Maybe
university. Will A's salary belong to the partnership?

A. Yes, because the salary was acquired through A's

industry or work
88. A partnership for a fixed term or a particular B. No, unless it is stipulated that his salary shall be
undertaking which is continued after the expiration deemed contributed
of the term or the attainment of the undertaking C. No, because it is considered a profit acquired from
becomes a partnership at will. * a property
D. Yes, if stipulated by the partners
A. True
B. False
94. A, B, and C formed a partnership with the name
ABC & Co. Partnership as a limited partnership in A. Yes, even the absence of stipulation;
mind. It is therefore: * B. Yes, because it was so stipulated;
C. No, because the law exempted the industrial
A. Limited partnership partner from losses;
B. General partnership D. No, because the partners cannot be stipulated that
C. If registered with the SEC, it is a limited partnership the industrial partner shall be liable for losses.
D. Partnership by estoppel

95. A limited partnership formed in 2015 by X as 99. S1: A universal partnership of present property
general partner and Y and as limited partners in 2016, shall include the profits which the partners may
Y and Z got married. Did the marriage dissolve or acquire therewith such as properties to be acquired
change the form of the partnership? 1st answer - Yes, through inheritance, legacy or donation. S2: A
partnership is dissolved by the marriage because partnership contract begins from the moment of the
there is a change in equity and Status among the execution of the contract unless it is otherwise
partners. 2nd answer - No, because spouses can enter stipulated. *
into a universal partnership *
A. First statement is true, second is false;
A. Both answers are correct. B. Both statements are true;
B. 1st answer wrong, 2nd answer correct C. First statement is false, second is true;
C. Both answers are wrong. D. Both statements are true.
D. 1st answer correct, 2nd answer wrong
100. Which of the following is not correct: *

96. Which of the following persons are not A. A limited partner shall not be bound by the
disqualified to form a universal partnership? * obligation of the partnership
B. A partnership contract is not conveyed by the
A. Those guilty of adultery and concubinage. Statue of frauds;
B. Husband and wife. C. A limited partner who takes part in the control of
C. Brother and sister. the business shall be liable as general partner.
D. Those guilty of the same of the criminal offense, D. A stipulation which excluded a partner from
the partnership is entered into a consideration of the sharing of the profits or loss is void.
same
101. Which of the following is incorrect: *
97. A, B, C and D organized a general partnership
with A and B as industrial partnership and C and D as A. A capitalist partner may engaged in the same line
capitalist partners. C contributed P5M and D of business as that the partnership;
contributed P2M to the common fund. By a B. An offending capitalist partnership may not
unanimous vote of the partners, A and D were engaged excluded from the firm;
appointed managing partners, without specification C. An industrial partner may not engaged in business
of their duties and powers. W applied as secretary for himself unless there is a contrary stipulation;
and X applied as accountant of the partnership. The D. An industrial partner who engages in business for
hiring of W was decided upon by A and B but was himself may be excluded from the firm.
opposed by C and D. Whose decision shall prevail. *

A. The decision of A and B shall prevail because the 102. A limited partner shall be liable as a general
hiring is an act of administration and as managers partner unless: *
they can do so;
A. he takes part in the control of the business
B. The decision of C and D because they have the
B. his surname appears in the partnership name
controlling interest;
C. his contribution is service
C. The decision of A and B because it is an act of
D. he renounces his shares in the profits after
ownership;
knowledge of the error that he was made a general
D. Answer not given.
partner

98. A and B agreed on a profit sharing ratio in their

102. A partnership is dissolved, except: *
partnership. A, being industrial partner and B as
capitalist partner. It was also stipulated that A shall A. death of a partner
also share in the same ratio as to the losses. Is A B. insolvency of a partner or of the partnership
liable for losses? * C. partnership business can only be carried on at a
loss
D. partnership business has become unlawful of the partnership? *

103. A, B, and C as partners contributed the A. SM because it is the supplier selected by the
following: A - P6,000; B - P4,000; C - service. They partners having controlling interest
agreed that the profits and losses shall be divided as B. Neither SM nor Ayala because selection of supplier
follows: A-35%; B-25%; C-40%. How shall the loss of requires unanimity of the partners.
P10,000 be distributed? * C. Both SM and Ayala because they are both selected
by the partners.
A. A - 6,000; B - 4,000; C - none D. Ayala because it is the supplier selected by the
B. A - 3,333; B - 3,333; C - 3,333 majority of the partners.
C. A - 3,500; B - 2,500; C - 4,000
D. A - 5,000; B - 5,000; C - none
109. A partner is personally indebted to his creditor.
104. A partnership acquires juridical personality If such creditor obtains a judgment award against
separate and distinct from that of the partners from that partner, can the creditor enforce judgment
the time of its registration with the SEC. A contract of against a specific partnership property? *
limited partnership must be in public instrument and
A. Yes, being a partner he has an interest over the
registered with the SEC. *
property of the partnership which can be attached.
A. Both are true B. No, because the partnership was not sued therein.
B. Both are false C. No, the partners right over the specific property is
C. First is true, second false free from execution and attachment if it is not a claim
D. First is false, second true against the partnership.
D. Yes, in order not to defeat the court judgment
award.
105. In the absence of stipulation, the share of the
industrial partner in the profits shall be equal to the
share of a capitalist partner with the smallest share. 110. A and B entered into a universal partnership of
The industrial partner shall not share in the losses all present property. At the time of their agreement,
unless stipulated. * A had a four-door apartment which he inherited
from his father 3 years earlier. B, on the other hand
A. first is false, second true had a fishpond which he acquired by dacion en pago
B. first is true, second false from C. during the first year of the partnership,
C. both are true rentals collected on the four-door apartment
D. parehas mali amounted to P480,000; while fish harvested from the
fishpond were sold for P300,000. During the same
106. A and B orally entered into a partnership with period, B received by way of donation a vacant lot
each contributing P3,000 and some personal from his uncle. The partners had a stipulation that
properties in the amount of P1,000 each. The future property shall belong to the partnership.
partnership contract is * Which of the following does not belong to the
common fund of the partnership? *
A. Unenforceable because the amount involved
exceeds P500 A. Apartment
B. Void because it is not in public instrument B. Vacant land
C. Valid C. Fishpond
D. Void because it is not in public instrument and not D. Rental of P480,000
registered with SEC
111. Which of the following will not cause the
automatic dissolution of a general partnership? *
107. A person admitted to all the rights of a limited
partner who has died or has assigned his interest in A. Insanity of an industrial partner
the partnership is known as * B. Civil interdiction of an industrial partner
C. Death of a capitalist partner
A. Substituted limited partner D. Insolvency of a capitalist partner
B. General-limited partner
C. Ostensible partner
D. Limited partner 112. A partnership the existence of which was only
108. A, B, C, D and E are partners in ABCDE known to those who had an interest in the same,
Partnership with capital contribution ratio of being no mutual agreements between the partners
5:4:3:2:1, respectively. No one is appointed as and without a corporate name indicating to the
managing partner in Articles of Co-Partnership. The public in some way that there were other people
partners held a meeting to determine its supplier. A besides the one who ostensibly managed and
and B voted in favor of SM while C, D and E voted in conducted the business, as defined in article 239 of
favor of Ayala. Who shall be considered the supplier the Code of Commerce. *
A. Cuentas en Participacion
B. Professional Partnership
C. Commercial Partnership 117. A,B and C entered into an oral contract of
D. Accidental Partnership partnership each contributing P1M each to the
common fund plus other personal properties of the
same amount and failed to register the partnership
113. The following are the rules in case a managing with the SEC. Is the partnership valid? *
partner collects a demandable debt from a person
who also owes the partnership a demand debt, A. Yes, because a partnership contract can always be
except oral.
B. No, because registration with the SEC is essential
A. The sum shall be fully applied to the partnership for a partnership to be valid and acquire juridical
credit, if the receipt given is for the account of the personality.
partnership C. No, because every contract of partnership having a
B. The debtor has the right to have the payment capital of three thousand pesos or more in money or
applied in his debt to the partner if it should be more property must be in public instrument and registered
onerous to him with the SEC.
C. It shall be applied to the two credits in proportion D. Yes, because public instrument is necessary only in
to their amounts case of contributions of immovable.
D. The sum collected shall be applied to the
partnership credit
118. Which of the following acts of the partnership
may be done by the managing partner alone? *
114. Which of the following is not an obligation of a
partner? * A. disposition of the goodwill of the business
B. approval of collecting bargaining agreement
A. To pay partnership for damages suffered by it C. renunciation of a claim of the partnership
through his fault. D. confession of judgment
B. To inspect and copy partnership books.
C. To give his capital contribution.
D. Not to engage in unfair competition with the 119. Which of the following losses will not cause the
partnership. dissolution of a partnership? *

A. Loss after delivery of a specific thing where the

115. A, B and C are partners in ABC Co. D owes the partner contributed only its use and enjoyment,
partnership P4,500. A, a partner, received from D a where such partner reserved the ownership thereof
share of P1,500 ahead of partners B and C, giving D a B. Loss before delivery of a specific thing which a
receipt for his share only. When B and C were partner had promised to contribute o the partnership
collecting from D, the latter was already insolvent. C. Loss before delivery of a specific thing where the
Which of the following is correct? * partner promised to contribute only its use and
enjoyment, reserving the ownership thereof
A. B and C can automatically deduct from the capital D. Loss of a specific thing after its delivery to and
contribution of A in the partnership, their respective acquisition of its ownership by the partnership from
share in the P1,500 the partner who contributed the same
B. B and C should automatically exhaust first all
remedies to collect from D
C. A cannot be required to share the P1,500 with B 120. D, E are capitalist partners while F is an
and C industrial partner in their restaurant business. Later,
D. Partner A can be required to share the P1,500 with F put up a cellular phone loading station, sells call
B and C cards and other cell phone accessories. Has F any
liability under the circumstances? *

A. Yes, because he can’t engage in business for

himself.
116.. Three lawyers formed a law partnership. The B. No, there is no showing that the business of the
senior and well-known partner died. Can they still partnership is being prejudiced.
continue using the name of such deceased partner? * C. Yes, because he is precluded by law to engage in
any other business, except if there is stipulation
A. Yes, since he was a partner. allowing him.
B. No, as he is already excluded from the partnership. D. No, since his other business is not competing with
C. Yes, as long as they will put some mark in that the business of the partnership.
name indicating that such partner is already
deceased.
D. No, as the partnership has been dissolved. 121. Which of the following is the right of an
assignee of a partner's interest? * A. No, there is no showing that the business of the
partnership is being prejudiced.
A. Right to inspect the partnership book and demand B. Yes, because he is precluded by law to engage in
audited financial statements of the partnership any other business, except if there is stipulation
B. Right to participate in the management of the allowing him.
partnership C. No, since his other business is not competing with
C. Right to the share in net income of his assignor the business of the partnership.
D. Right to vote in the selection of the managing D. Yes, because he can’t engage in business for
partner himself.

126. A and B orally agreed to form a partnership two

122. Jane, Erik and Matet are partners in buying and
years from today, each one to contribute P1,000. If
selling cars. Jane, by the partners agreement, was
at the arrival of the period, one refuses to go ahead
authorized to buy only in cash. One day, Jane bought
with the agreement, can the other enforce the
on credit a car from Joanne, a client, who did not
agreement?
know of Jane's lack of authority. Jane's purchase was
made in the name of the partnership. Is the A. Yes, because the prior agreement was voluntarily
partnership bound in the sale? * made
B. Yes, because the partnership contract is not
A. It is not bound because the contract with Joanne is
governed by the Statute of Frauds
not in the ordinary course of business.
C. No, because the agreement was merely oral and
B. It is bound if it ratifies the contract of sale by
executor
acceptance of benefits.
D. No, since the agreement is to be enforced after
C. It is bound because Joanne was in good faith and
one year from the making thereof, the same should
the act of Jane was apparently in the conduct of the
be in a public instrument to be enforceable
business.
D. The partnership is not bound because the contract
is unenforceable, Jane exceeded his authority. 127. Every partner is a _______ of the partnership for
whatever he may have promised to contribute
thereto.
123. A,B and C entered into an oral contract of
partnership each contributing P1M each to the A. None of the above
common fund plus other personal properties of the B. Agent
same amount and failed to register the partnership C. Debtor
with the SEC. Is the partnership valid? * D. Manager
A. Yes, because a partnership contract can always be
128. The following are the rules in case a managing
oral.
partner collects a demandable debt from a person
B. No, because registration with the SEC is essential
who also owes the partnership a demand debt,
for a partnership to be valid and acquire juridical
except
personality.
C. Yes, because public instrument is necessary only in A. It shall be applied to the two credits in proportion
case of contributions of immovable. to their amounts
D. No, because every contract of partnership having a B. The sum collected shall be applied to the
capital of three thousand pesos or more in money or partnership credit
property must be in public instrument and registered C. The sum shall be fully applied to the partnership
with the SEC. credit, if the receipt given is for the account of the
partnership
D. The debtor has the right to have the payment
124.Special power of attorney is necessary in the
applied in his debt to the partner if it should be more
following cases, except: *
onerous to him
A. Any other act of strict dominion.
B. To compromise, to submit questions to arbitration;
129. Which of the following losses will not cause the
dissolution of a partnership? *
C. To make such payments usually considered as acts
of administration; A. Loss after delivery of a specific thing where the
D. To bind a principal in a contract of partnership; partner contributed only its use and enjoyment,
where such partner reserved the ownership thereof
125. D, E are capitalist partners while F is an B. Loss of a specific thing after its delivery to and
industrial partner in their restaurant business. Later, acquisition of its ownership by the partnership from
F put up a cellular phone loading station, sells call the partner who contributed the same
cards and other cell phone accessories. Has F any C. Loss before delivery of a specific thing where the
liability under the circumstances? * partner promised to contribute only its use and
enjoyment, reserving the ownership thereof 135. S1: Partnership with a capital of three thousand
D. Loss before delivery of a specific thing which a pesos or more, in money or property, shall appear in
partner had promised to contribute to the a public instrument, and recorded at SEC. Failure
partnership shall not affect the liability of the partnership and
members thereof to third person. S2: Whenever
immovable property is contributed, an inventory of
130. In a partnership, the partners share in the said property is needed, signed by the parties and
profits attached to the public instrument, otherwise the
contract of partnership is void. *
A. According to capital contribution
B. According to the contract A. Both statements are true
C. Justify and equitably B. Only the first statement is true
D. Equally C. Only the second statement is true
D. Both statements are false
131. There is partnership except: *
136. Which of the following is not correct? *
A. They give money, property or industry to a
common fund A. A partnership begins from the moment of the
B. There is no fiduciary relationship execution of the contract, unless it is otherwise
C. There is division of profits and losses among stipulated.
themselves B. A particular partnership has for its objects
D. Two or more parties consent to a contract, oral or determinate things, their use or fruits, or a specific
written undertaking or the exercise of a profession or
vocation.
C. Articles of universal partnership entered into
132. A and B are co- owners of a parcel of land from
without specification of its nature, only constitute a
which they derive profits in equal sharing being co-
universal partnership of all present property.
heirs in inheritance. Is there a partnership? *
D. Persons who are prohibited from giving each other
A. There is a partnership because of the equal sharing any donation or advantage cannot enter into
of profits. universal partnership.
B. There is partnership they being co- owners and co-
possessors.
137. A, B and C are partners in ABC Co. D owes the
C. There is no partnership since in partnership
partnership P4,500. A, a partner, received from D a
division of profits is not always necessary among
share of P1,500 ahead of partners B and C, giving D a
partners.
receipt for his share only. When B and C were
D. There is no partnership because co-ownership by
collecting from D, the latter was already insolvent.
itself does not establish a partnership despite the
Which of the following is correct? *
sharing of profits.
A. Partner A can be required to share the P1,500 with
133. . When the manner of management has not B and C
been agreed upon, who shall manage the affairs of B. B and C should automatically exhaust first all
the partnership? * remedies to collect from D
C. A cannot be required to share the P1,500 with B
A. Industrial partners
and C
B. Capitalist-industrial partners
D. B and C can automatically deduct from the capital
C. Capitalist partners
contribution of A in the partnership, their respective
D. All of the partners
share in the P1,500

138. A capitalist partner engaged for his own

134. Essential elements or feature of a partnership, account in an operation which is of the kind of
except * business in which the partnership is engaged. Said
partner can be
A. Must have a lawful object or purpose
B. Must be established for the common benefit or A. Compelled to sell his interest in the partnership to
interest of the partners the other capitalist partners
C. With intention to divide and contribute whatever B. Compelled to dissolve or discontinue the
profits they make to other people operations of his business
D. There must be a contribution of money, property C. Compelled to bring to the common fund of the
or industry to a common fund partnership any profits accruing to him from his
transactions
D. Denied his share of the profits of the partnership
 the limited partner? *
139. These statements are presented to you: S1 - As
a rule, a limited partner is not a proper party to A. Jessica only.
proceedings by or against a partnership. S2 - A B. Sienna only.
limited partner may, however, be a proper party if C. Both Jessica and Sienna.
the object of the proceeding is to enforce a limited D. Neither Jessica nor Sienna; hence, they cannot
partner’s right against the partnership or a limited enter into a limited partnership.
partner’s liability to the partnership. In your
evaluation of the foregoing statements: *

A. Both statements are true

B. Both statements are false
C. First is true, second is false
D. First is false, second is true

140. Which of the following rights is a limited

partner entitled to? *

A. Grant a loan to the partnership

B. Transact business with the partnership
C. Either (a) or (b), or both (a) and (b)
D. Neither (a) nor (b) because a limited partner is
prohibited from any business dealing with the
partnership except as regards the return of his
contribution or the payment of compensation to him
by way of income

141. Which of the following rights of a general

partner is/are also the rights of a limited partner? *

A. Right to inspect and copy partnership books at a

reasonable hour
B. Right to have on demand true and full information
of all things affecting the partnership
C. Right to have dissolution and winding up by decree
of court
D. All of the foregoing

142. Without the written consent or the ratification

by all the limited partners, a general partner or all
the general partners, have no authority to perform
any of the following acts, except to: *

A. Admit a person as a general partner.

B. Continue the business with partnership property
on the death, retirement, insanity, civil interdiction or
insolvency of a general partner.

C. Admit a person as a limited partner.

D. Continue the business with partnership property
on the death, retirement, insanity, civil interdiction or
insolvency of a limited partner.

143. Jessica and Sienna want to put up an internet

café business. Jessica is an expert in information
technology and computers but has no funds or
property to invest. Sienna knows nothing about
internet and computers but she is willing to
contribute the funds and property needed. If Jessica
and Sienna decide to enter into a limited
partnership, who between the two of them will be