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PARTNERSHIP MCQ LECTURE SET PART 2 A. Both answers are correct

B. 1st answer wrong, 2nd answer correct
C. Both answers are wrong
1. If a partner is insolvent, the first order of D. 1st answer correct, 2nd answer wrong
preference in the distribution of his assets is:
A. Partnership creditors 6. The following are instances, except one, when a
B. Partner’s contribution in the partnership partnership is unlawful. Which is the exception?
C. Separate creditors of the debtor A. A partnership formed for smuggling of
D. Pro-rata between the separate creditors and contrabands
the partnership’s creditors B. A partnership formed to furnish apartment
houses to be used as venue for illegal
2. Which of the following is NOT a requisite gambling
prescribed by law in order that a partnership may C. A partnership formed for the purpose of
be held liable to a third party for the acts of one buying public lands
of its partners? D. A partnership formed to create cartel for
A. The partners bind the partnership by monopolies
acquiescence for the obligations he may have
contracted in good faith 7. XYZ Partnership composed of three (3) capitalist
B. The partner must have the authority to bind partners and one industrial partner suffered
the partnership business losses. Its remaining assets amounted to
C. The contract must be in the partnership’s P100,000. The partnership is indebted to its
name or for its account supplier, Mr. Cruz, in the amount of P160,000.
D. The partner must act on behalf of the How can Mr. Cruz recover the P60,000?
partnership A. Cruz can recover from the partnership
P100,000 and the balance of P60,000 from the
3. X, Y and Z are partners in Able Co. W represented three capitalists partners only
himself as a partner in Able Co. to B, who, on the B. Cruz can recover from the partnership
faith of such representation, granted P300,000 P100,000 and the balance of P60,000 from
loan to the partnership. Assuming only X and Y any of the partners solidarily
consented to such representation, who shall be C. Cruz can recover from the partnership
liable to B? P100,000 and the balance of P60,000 from the
A. Since the partnership benefitted from the four partners jointly including the industrial
credit extended by B, all partners X, Y and Z partner.
are liable D. Cruz can recover from the partnership
B. Only X, Y and W who are partners by estoppel P100,000 only and suffer as his loss in the
are liable pro-rata to B balance of P60,000.
C. Since the loan was extended to the
partnership, all the partners and W are liable 8. A, B and C formed a limited partnership with A as
D. Only W who made representation shall be general partner, B as limited partner and C as
liable to B industrial partner. A and B contributed P50,000
each. The partnership failed and after disposing
4. Which of the following incidents may be a cause of all its assets to pay partnership debts, there still
for involuntary dissolution of a partnership? remains a note payable in the sum of P30,000.
A. Expulsion of any partner Against whom can the creditor demand payment
B. Termination of the term of the partnership of the note of P30,000?
C. Insolvency of any partner A. A legal representative of a limited partner
D. Express will of any partner B. A and B are liable to pay P15,000 each
C. Only A is liable to pay the P30,000
5. A limited partnership was formed in 20XX by X as indebtedness
general partner and Y and Z as limited partners. D. A and C are liable to pay P15,000 each
In 20XY, X and Z got married. Did the marriage
dissolve or change the form of the partnership? 9. A and B are partners. On June 15, 20XX, when the
1st Answer: Yes, partnership is dissolved by the total obligations of the partnership totals
marriage because there is a change in equity and P80,000, C was admitted as a new partner. At the
status among the partners. time of C’s admission, the partnership creditors
2nd Answer: No, because spouses can enter into a were M for P50,000 and N for P30,000. After June
universal partnership. 15, the partnership borrowed from O P20,000 and
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P40,000 from P. On December 15, 20XX, the D. Yes, because spouses cannot enter into a
partnership becomes insolvent leaving an particular partnership
obligation totaling P140,000 and partnership
assets amounting to P30,000. The creditors are 13. X, Y and Z were partners. X is an industrial
going after the separate properties of the partner. During the first year of operation, the
partners to satisfy their remaining claims. How firm realized a profit of P60,000. During the
are the creditors’ claims satisfied? second year, the firm sustained a loss of P30,000.
Answer 1 – M and N can go after the separate So, the net profit for the two years of operation
properties of A and B but C’s separate properties was only P30,000. In the articles of partnership, it
are not answerable to their claims. was agreed that X, the industrial partner, would
Answer 2 – O and P can go after the separate get 1/3 of the profit but would not share in the
properties of A, B and C. losses. How much will X, the industrial partner,
Which of the following is correct? get?
A. Both answers are wrong. A. X will get only P20,000 which is 1/3 of the
B. Answer 1 is wrong but answer 2 is correct. profit of the 1st year of operation
C. Both answers are correct. B. X will get only P10,000 which is 1/3 of the net
D. Answer 1 is correct but answer 2 is wrong. profit
10. A and B are capitalist partners with C as industrial C. X will get only P20,000 in the first year and
partner. A and B contributed P20,000 each to the none in the second year
capital of the partnership. A contractual liability D. X will share in the loss in the second year
of P50,000 was incurred by the partnership in
favor of X. The assets of the partnership have 14. A, B and C, capitalist partners, each contributed
been exhausted still leaving an unpaid liability of P30,000, P20,000 and P10,000, respectively and
P12,000. What are the rights and the obligation D, the industrial partner, contributed his services.
of the partners, if any? Suppose X, a customer, is the creditor of the firm
A. A, B and C are liable to X, and C after giving his to the amount of P180,000. How can X recover
share may ask reimbursement from A and B, the P180,000?
unless otherwise stipulated A. X must sue the firm and get P60,000 and X can
B. Only A and B are liable to X still recover the balance of P120,000 from the
C. Only C is liable to X four partners jointly (including D, the
D. A, B and C are liable to X and C has no right for industrial partner).
reimbursement from A and B unless expressly B. X can recover from the firm P60,000 and X can
stipulated still recover the balance of P120,000 from the
capitalist partners only.
11. Which of the following liabilities of the C. X can recover from the firm P60,000 and X can
partnership shall rank first in the order of still recover the balance of P120,000 from any
payment? of the partners solidarily.
A. Those owing to creditors other than the D. X can recover from the firm P60,000 and X can
partners consider the balance of P120,000 as a loss.
B. Those owing to partners in respect to profits
C. Those owing to partners in respect to capital 15. X, Y and Z are equal partners to XYZ Partnership.
D. Those owing to partners other than for capital A owes XYZ Partnership for P9,000. Z, a partner,
and profits collected from A P3,000 before X and Y received
anything. Z issued a receipt on the P3,000 as his
12. A limited partnership named “A, B and C Co. Ltd.” share of what A owes. When X and Y collected
Was formed on October 25, 20XX by A as general from A, A was insolvent.
partner and B and C as limited partners. A year A. Partner Z shall share the P3,000 with partners
later, A and B got married. Did the marriage X and Y
dissolve or put an end to the partnership? B. Z cannot be required to share with X and Y the
A. Yes, the partnership is dissolved by the P3,000
marriage because there is a change in equity C. X and Y would first exhaust all remedies to
among the partners collect from A
B. No, the marriage did not dissolve the D. X and Y can automatically deduct from the
partnership capital contribution of Z in the partnership
C. No, because spouses can enter into a their respective share in the P3,000
universal partnership
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16. A and B are partners in a real estate partnership. A. Capitalist partner

The partnership owns a piece of land which C B. Limited partner
desired to buy. C contracted A and informed him C. Partners contributing usufructuary rights
of his desire to buy the land and A did not tell B D. None of the above
about it. A bought B out of the partnership and
afterwards sold the land to C for a big profit. 21. A partnership is not dissolved on the death of a
A. The partnership is dissolved when A became A. General partner
the sole owner B. Industrial partner
B. The sale of the land to C is void because it was C. Limited partner
without the knowledge of B D. General limited partner
C. A is not liable to B for the latter’s share in the
profits 22. B1, B2 and B3 are equal partners in 3Brothers
D. A is liable to B for the latter’s share in the Partnership. The partnership is indebted to PC for
profits P150,000. B1 is indebted to SC for P20,000. PC
attached and took all the assets of the partnership
17. A is the capitalist partner and B is the industrial amounting to P90,000. B2 and B3 are solvent
partner. A engaged personally in the same kind of while B1 is insolvent and all that he owns is a
business the partnership is engaged in. property valued at P15,000.
A. If there are losses, the partnership will bear A. SC has priority to the property of B1 as a
the losses separate creditor
B. If there are profits, the profits will be shared B. PC has priority to the property of B1 to cover
by A and the partnership B1’s share of the P60,000 remaining liability of
C. If there are profits, A will give the profits to the the partnership
partnership C. B2 and B3 have priority to the property of B1
D. A will be excluded from the partnership and if they paid PC the P60,000 remaining liability
pay damages of the partnership
D. PC and SC shall both have priority to the
18. A is the managing partner of ABC and Company. property of B1 in proportion to their claims of
X owes A personally and ABC and Company P60,000 and P20,000, respectively
P20,000 each. A collected and received from X
P10,000 and he issued a receipt wherein it is 23. The following are the contributions of the
stated that the amount is applied against his partners to the partnership: A P30,000, B P15,000
personal credit. and C services. After payment of all liabilities and
A. The amount received will be applied in favor expenses, only P18,000 remain as partnership
of the partnership credit assets. The distribution of the P18,000 cash shall
B. The amount received will be applied in be:
proportion to both credits A. A, P12,000; B, P6,000; C, none
C. The amount received will be applied to the B. A, P6,000; B, P6,000; C, P6,000
credit of A C. A, P9,000; B, P9,000; C, none
D. All the partners will decide as to whose favor D. A, P8,000; B, P4,000; C, P6,000
it will apply
24. This is the order of preference in the liquidation
19. Three of the following are rights of a general of a partnership:
partner and also of a limited partner in a limited A. 1. Outside creditors; 2. Partners with respect
partnership. Which is not? to their capital; 3. Partners with respect to
A. To inspect and copy at reasonable hours the their profit; 4. Partners aside from capital and
books of the partnership and have them kept profit
at the principal place of business B. 1. Partners with respect to their capital; 2.
B. To demand true and full information of all Partners with respect to their profit; 3.
matters affecting the partnership and a formal Partners aside from capital and profit; 4.
account of the partnership affairs Outside creditors
C. To have dissolution and winding up by decree C. 1. Outside creditors; 2. Partners aside from
of court capital and profit; 3. Partners with respect to
D. None of the above their capital; 4. Partners with respect to their
profit
20. Bears the loss of property contributed to the D. 1. Partners aside from capital and profit; 2.
partnership Outside creditors; 3. Partners with respect to
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their capital; 4. Partners with respect to their A. Dissolution or annulment of the partnership
profit contract
B. For A, C and D to get back their contribution
25. Three of the following are rights of a partner. C. For specific performance
Which one is not? D. Remedy not indicated
A. Right to associate another person to his share
B. Right to admit another partner 30. A partner in a partnership who is not really a
C. Right to inspect and copy partnership book partner, not being a party to the partnership
D. Right to ask dissolution of the firm at the agreement but is made liable as a partner for the
proper time protection of innocent third persons is known as
A. Secret partner
26. In the partnership of A, B and C, A was appointed B. Dormant partner
in the Articles of Co-Partnership as managing C. Nominal partner or partner by estoppel
partner. As such manager and acting in good D. Answer not given
faith:
A. His power is revocable even without his
consent
B. His power can be revoked at any time even
without just cause provided that it is approved
by the partners owning the controlling
interest
C. He may execute all acts of administration
despite the opposition of B and C
D. He can be removed for valid cause even
without the vote of the partners owning the
controlling interest

27. X and Y established a partnership by contributing

P50,000 each. Z, a third party, allowed his name
to be included in the firm name of the
partnership. The partnership was insolvent and
after exhausting all the remaining assets, a
liability of P30,000 was left unpaid. The creditors
can compel
A. Z to pay the P30,000 remaining liability
B. X, Y and Z to pay P10,000 each
C. X or Y to pay P30,000 remaining liability
D. X and Y to pay P15,000 each

28. W, X, Y and Z formed a partnership with W, X and

Y as general partners contributing P50,000 each
while Z as industrial partner only. All the partners
signed an agreement stipulating that the liability
of W is limited to his capital contribution. Alter all
the assets of the partnership were exhausted,
there remains an unpaid liability of P40,000. The
creditors of the partnership can compel
A. X and Y to pay the P40,000
B. X, Y and Z to pay the P40,000
C. W, X, Y and Z to pay P10,000 each and W and
Z can demand reimbursement from X and Y
D. Any of the above
29. In ABCD Partnership, only partner B did not
deliver his agreed capital contribution in the form
of specific house and lot. The remedy against him
is