FATHER SATURNINO URIOS UNIVERSITY

LAW ON BUSINESS ORGANIZATIONS

COMPREHENSIVE EXAMINATION ON PARTNERSHIP

TRUE OR FALSE
1. Statement 1: Partnership with a capital of three thousand pesos or more, in money or
property, shall appear in a public instrument, and recorded at SEC. Failure shall not affect the
liability of a partnership and members thereof to third person.
Statement 2: When immovable property is contributed, an inventory of said property is
needed, signed by the parties and attached to the public instrument, otherwise the contract of
partnership is void.
Statement 1: __________
Statement 2: __________
True; True
2. Statement 1: Co-ownership or co-possession does not in itself establish a partnership, except
when such co-owners or co-possessors share in the profits made by the use of the property.
Statement 2: The sharing of gross returns does not of itself establish a partnership, except
when the persons sharing them have a joint or common right or interest in any property from
which the returns are derived.
Statement 1: __________
Statement 2: __________
False; False
3. Statement 1: The receipt by a person of a share of the profits of a business is conclusive
evidence that he is a partner in the business.
Statement 2: A partnership of all present property is where the partners contribute all
property which actually belong to them to a common fund, with the intention of dividing the
same among themselves, as well as all the profits which they may acquire therewith.
Statement 1: __________
Statement 2: __________
False; True
4. Statement 1: In a universal partnership of all present property, the property which belong to
each of the partners at the time of constitution of the partnership becomes a common fund of
all partners and all profits which they may acquire through inheritance, legacy, or donation
cannot be included in such stipulation, except the fruits thereof.
Statement 2: The universal partnership of profits comprises all that the partners may acquire
by industry or work during the existence of the partnership. Movable or immovable property
which each may possess at the time of the celebration of the contract shall continue to pertain
exclusively to each, only the usufruct passing to the partnership.
Statement 1: __________
Statement 2: __________
True; True
5. Statement 1: A partnership must have a lawful object or purpose, and must be established for
the common benefit or interest of the partners.
Statement 2: When an unlawful partnership is dissolved by a judicial decree, the profits and
partners’ contributions shall be confiscated in favor of the State.
Statement 1: __________
Statement 2: __________
True; False
6. Statement 1: A partnership may be constituted in any form, except where immovable
property or real rights are contributed thereto, in which case a written instrument shall be
necessary.
Statement 2: Every contract of partnership having a capital of three thousand pesos or more
in money or property shall appear in a public instrument which must be recorded in the office
of the SEC, otherwise the partnership is void.
Statement 1: __________
Statement 2: __________
False; False
7. Statement 1: A contract of partnership is void, whenever immovable property is contributed
thereto, if an inventory of said property is not made, signed by the parties and attached to the
public instrument.
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Statement 2: A universal partnership of profits is that in which the partners contribute all the
property which actually belongs to them to a common fund with the intention of dividing the
same among themselves, as well as the profits which they may acquired therewith.
Statement 1: __________
Statement 2: __________
True; False
8. Statement 1: In a universal partnership of profits, the property which belong to each of the
partners at the time of the constitution of the partnership becomes the common property of all
the partners, as well as all the profits which they may acquire therewith.
Statement 2: A universal partnership of all present property comprises only all that the
partners may acquire by their industry or work during the existence of the partnership.
Statement 1: __________
Statement 2: __________
False; False
9. Statement 1: A universal partnership of profits comprises all movable or immovable property
which each of the partners may possess at the time of the celebration of the contract and all
that the partners may acquire by their industry or work during the existence of the
partnership.
Statement 2: Future property by inheritance, legacy or donation, including the fruits thereof
cannot be included in the stipulation regarding the universal partnership of all present
property.
Statement 1: __________
Statement 2: __________
False; False
10. Statement 1: A and B are partners in a universal partnership of profits. Subsequently, A won
first prize in the sweepstakes. The prize money will belong to the partnership.
Statement 2: A and B are partners in a universal partnership of profits. Later A purchased a
parcel of land. The fruits of said land belong to the partnership.
Statement 1: __________
Statement 2: __________
False; False
11. Statement 1: If property has been promised by a partner as contribution to the partnership,
the fruits Arising from the time the property should have been delivered should also be given
provided prior demand was made.
Statement 2: A partner who has undertaken to contribute a sum of money and fails to do so
becomes a debtor for the interest and damages from the time he should have complied with
his obligation, without the need of any demand.
Statement 1: __________
Statement 2: __________
False; True
12. Statement 1: The partners shall contribute equal shares to the capital of the partnership.
Statement 2: If there is no agreement to the contrary, in case of an imminent loss of the
business of the partnership, any partner who refuses to contribute additional share to the
capital, to save the venture, shall be obliged to sell his interest to the other partners.
Statement 1: __________
Statement 2: __________
False; False
13. Statement 1: If a partner collects a demandable sum, which was owed to him in his own
name, from a Person who owed the partnership another sum also demandable, the sum thus
collected shall be applied to the two credits in proportion to their amounts, even though he
may have given a receipt for his own credit only, but should he have given it for the account
of the partnership credit, the amount shall be fully applied to the latter.
Statement 2: The risk of specific and determinate things contributed to the partnership so that
only their use and fruits may be for the common benefit, shall be borne by the partner who
owns them.
Statement 1: __________
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Statement 2: __________
False; False
14. Statement 1: In the absence of stipulation, the share of each partner in the profits and losses
shall be equal to each other.
Statement 2: A stipulation which excludes one or more partners from any share in the profits
or losses is void, as a general rule.
Statement 1: __________
Statement 2: __________
False; True
15. Statement 1: The partner who has been appointed manager may execute all acts of
administration despite the opposition of his partners, unless he should act in bad faith and his
power is irrevocable without just or lawful cause.
Statement 2: When the manner of management has not been agreed upon, none of the
partners may, without the consent of the others, make any important alterations in the
property of the partnership, even if it may be useful to the partnership.
Statement 1: __________
Statement 2: __________
False; False
16. Statement 1: Every partner may associate another person with him in his share, provided it is
with the consent of all of the other partners.
Statement 2: The capitalist partners cannot engage for their own account in any operation
which is of the kind of business in which the partnership is engaged, unless there is
stipulation to the contrary.
Statement 1: __________
Statement 2: __________
False; True
17. Statement 1: Every partnership shall operate under a firm name, which shall include the
name of one or more of the partner.
Statement 2: All partners, excluding industrial ones, shall be liable pro-rata with all their
property and after all partnership assets have been exhausted, for the contracts which may be
entered into in the name of and for the account of the partnership, under its signature, and by
a person authorized to act for the partnership.
Statement 1: __________
Statement 2: __________
False; False
18. Statement 1: Persons who are not partners as to each other are not partners as to third
persons, except in cases of estoppel.
Statement 2: An admission or representation made by any partner concerning partnership
affairs is evidence against the partnership.
Statement 1: __________
Statement 2: __________
True; False
19. Statement 1: A person admitted as a partner into an existing partnership is liable for all the
obligations of the partnership arising before his admission as though he had been a partner
when incurred and that such liability will extend to his own individual property.
Statement 2: B has worked for M and Co., as procurer of contracts for fertilizers to be
manufactured by the firm, and as supervisor of the mixing of the fertilizers. However, he had
no voice in the management of the business except in his task of supervising the mixing of
said fertilizers. For his service, he is entitled to 35% of the profits in the fertilizer business.
He is a partner in M and Co.
Statement 1: __________
Statement 2: __________
False; False
20. Statement 1: C was a bookkeeper in a partnership named “AB”, with a yearly salary
amounting to 5% of the net profits or each year. C, however had no vote at all in the
management of the business. He is a partner in AB.
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COMPREHENSIVE EXAMINATION ON PARTNERSHIP

Statement 2: Unless there is a stipulation to the contrary, the partners shall contribute equal
shares to the capital of the partnership.
Statement 1: __________
Statement 2: __________
False; True

MULTIPLE CHOICE
1. One of the following is not a characteristic of a contract of partnership
A. Principal, because it can stand by itself.
B. Preparatory, because it is a means by which other contracts will be entered into.
C. Real, in that the partners must deliver their contributions in order for the
partnership contract to be perfected.
D. Onerous, because the parties contribute money, property or industry to the common
fund.
2. One of the following is not a requisite 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.

3. 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 public
instrument and be registered with SEC.
A. P 5,000
B. P10,000
C. P 3,000
D. P30,000
4. X and Y entered into a universal partnership of all present property. At the time of their
agreement. X had a four-door apartment which he inherited from his father 3 years
earlier. Y, on the other hand, had a fishpond which he acquired by dacion en pago from
Z. 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 an stipulation that future property shall belong to the partnership. Which of
the following does not belong to the common fund of the partnership?
A. Fish pond
B. Rental of P480,000
C. Apartment
D. Vacant lot
5. D and E entered into a universal partnership of profits. At the time of execution of the
articles of partnership, D had a two-door apartment which he inherited from his father 3
years earlier. E on the other hand, had fleet of taxis which he purchased two years before.
In the first year of the partnership, D earned P500,000 as radio talent while E 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
6. A partnership formed for the exercised of a profession which is duly registered is an
example of
A. Universal partnership of profits
B. Universal partnership of all present property
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C. Particular partnership
D. Partnership by estoppel
7. A, B and C are partners in ABC 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 ABC Enterprises. Thereafter, E granted a loan of P150,000 to
ABC enterprises. What kind of partner is D?
A. Managing partner
B. Liquidating partner
C. Ostensible partner
D. Partner by estoppel
8. Using the preceding number, assuming ABC Enterprises was unable to pay the loan on
due date at which time the assets of the partnership amounted to P120,000. From whom
may E collect the payment?
A. D only for the whole amount of P120,000.
B. A, B and C who are liable jointly for P50,000 each.
C. ABC Enterprises for its assets of P120,000; hereafter, A, B and C from their separate
assets at P10,000 each.
D. ABC Enterprises for its assets of P120,000 thereafter, A, B, C and D from their
separate assets at P7,500 each.
9. Which of the following losses will not cause the dissolution of a partnership?
A. Loss before delivery of a specific thing which a partner had promised to contribute to
the partnership.
B. Loss of a specific thing after its delivery to and acquisition of its ownership by
the partnership from the partner who contributed the same.
C. Loss after delivery of a specific thing where the partner contributed only its use and
enjoyment where such partner reserved the ownership thereof.
D. Loss before delivery of a specific thing where the partner promised to contribute only
its use and enjoyment, reserving the ownership thereof.
10. 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.
11. 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.
12. 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 the 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.
13. Partnership as distinguished from corporation
A. Acquires juridical personality upon approval by the SEC and the issuance of
certificate.
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B. Has limited liability.

C. Created by operation of law.
D. No power of succession.
14. 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.
18. Partner who manages actively the firm’s affairs
A. Silent
B. Liquidating
C. Managing
D. Dormant
19. Partner who does not participate in the management though he shares in the profits or
losses.
A. Liquidating
B. Nominal
C. Ostensible
D. Silent
20. Partner who is not really a partner but who may become liable as such insofar as third
persons are concerned
A. Nominal
C. Ostensible
D. Silent
E. Secret
21. 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 P20,000 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.
22. A newly admitted general partner is liable to creditors existing at the time of his
admission and his liability is
A. Up to his capital contribution only if there is stipulation.
B. Up to his separate property even there is no stipulation.
C. Up to his capital contribution even if there is stipulation.
D. Up to his separate property only if there is stipulation.
23. Using the preceding number, but the obligations were contracted after his admission,
which of the following is correct?
A. He is liable to the creditors before and after his admission up to his separate property.
B. He is liable to the creditors before and after his admission only up to his capital
contribution.
C. He is liable to the creditors before and after his admission up to his capital
contribution and to the creditors after his admission up to his separate property
D. He is not liable to creditors existing before his admission.
24. A and B are partners engaged in the real estate business. A learned that C was interested
in buying a certain parcel of land owned by the partnership, even for a higher price.
Without informing B of C’s offer A was able to convince B to sell to him (A) his (B’s)
share in the partnership. Then A sold the land at a big profit. Which of the following is
correct?
A. A is liable to B for the latter’s share in the profit.
B. C is liable to B for the latter’s share in the profit.
C. A new partnership is formed between A and C.
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D. The sale of the land to C is void since it was without the knowledge of B.
25. A and B are partners in a real estate business. A and B were approached by X who
offered to buy a parcel of land owned by the partnership. Thereafter B sold to A, B’s
share in the partnership. Then A sold the land to X at a big profit. Which is correct?
A. The sale of the land to X is void
B. A is liable to B for B’s share in the profits.
C. B may rescind the contract between A and X
D. A is not liable to B for any share in the profits.
26. The following persons are disqualified to form a universal partnership, except
A. Husband and wife
B. Brother and sister
C. Those guilty of adultery and concubinage
D. Those guilty of the same criminal offense; if the partnership is entered into in
consideration of the same.
35. A, B and C are capitalist partners while D is an industrial partner. A, the managing
partner engaged personally in a business that is the same as the business of the
partnership without the consent of the other partners. As a result,
A. If there are losses, the partnership will bear the losses
B. If there are profits, the profits will be shared by A and the partnership.
C. If there are profits, A will give the profits to the partnership.
D. A will be excluded from the partnership and will pay damages.
36. A, a managing partner is B’s creditor to the amount of P1,000 already demandable. B
also owes the partnership P1,000, also demandable. A collects P1,000 from B. One is not
correct.
A. If A gives a receipt for the partnership it is the partnership’s credit that has been
collected.
B. If A gives a receipt for his own credit, it is A’s credit that has been collected.
C. If A gives a receipt for his own credit, P500 will be given to him, P500 to the
partnership.
D. B may decide that he is paying only A’s credit if the personal credit of A is more
onerous to B.
37. The remedy of capitalist partners against an industrial partner who engaged in a business
for himself without the expressed permission from the partnership is:
A. To compel him to sell his interest to the said capitalist partners.
B. To exclude him from sharing in the profits of the partnership.
C. To remove him as manager if he is appointed as manger of the partnership.
D. To expel him from the partnership and claim for damages.
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
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D. Partnership at will
41. A, B and C, capitalist partners, each contributed P10,000 and D, the industrial partner
contributed his services. Suppose X, is the creditor of the firm amounting to P90,000.
After getting the P30,000 capital assets of the partnership, which is correct?
A. X can recover P20,000 each from A, B and C only.
B. X can recover P60,000 from either A, B and C only.
C. X can recover P15,000 each from A, B, C and D.
D. X can recover P15,000 each from A, B and C but D is exempt because he is an
industrial partner.
42. A, B and C are partners. D is admitted as a new partner. Will D be liable for partnership
obligations contracted prior to his admission to the partnership?
A. No, only for those contracted after his admission.
B. Yes, and his liability would extend to his own individual property.
C. Yes, but his liability will extend only to his share in the partnership property and
not to his own individual property.
D. Yes, as if he had been an original partner.
43. A partner who has all the rights, powers and subject to all restrictions of a general partner
but whose liability is, among themselves, limited to his capital contribution is:
A. General partner
B. Limited partner
C. General-limited partner
D. Dormant partner
44. 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 usufructuary rights over non-fungible things
45. A, B and C, capitalist partners, each contributed P10,000. After exhausting the assets of
the firm, the firm’s indebtedness amounts to P90,000. It was stipulated that A would be
exempted from liability. Which is correct?
A. A may recover his original capital of P10,000.
B. The creditors may collect P30,000 each from A, B and C.
C. A can recover P20,000 each from B and C should he be required to pay the creditors.
D. The creditors can recover P45,000 each from B and C.
46. Instances when a partnership is unlawful, except
A. A partnership formed to furnish apartment houses which would be used or
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.
47. A and B orally agreed to form a partnership two years from today, each one 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 executor
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.
48. Where at least one partner is a general partner and the rest are limited partners
A. General partnership
B. Partnership by estoppels
C. Partnership de facto
D. Limited partnership
49. Where all the partners are general partners
A. General partnership
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B. Partnership by estoppels
C. Partnership de facto
D. Limited partnership
50. A and B are equal partners in AB Partnership by contributing P50,000 each on June 1,
2010. On July 1, 2010, the partnership contracted an obligation to pay Z the amount of
P180,000 on August 31, 2010. On August 10, 2010, C was admitted as a new partner. C
contributed P50,000. How will the obligation be paid?
A. A P60,000; B P60,000; C P60,000
B. A P90,000; B P90,000; C None
C. A P180,000 or B P180,000 and C P50,000
D. A P65,000; B P65,000; C P50,000
51. A, B and C are equal partners in ABC Partnership. On April 29, 2010, C died. Not
knowing that C is dead, on May 2, 2010, A contracted a liability to D who also did not
know about the death of
C. The liability is P90,000. After D exhausted the net assets of the partnership in the
amount of P60,000, he can collect
A. P30,000 from A or P30,000 from B.
B. P15,000 from A and P15,000 from B.
C. P10,000 from the estate of C, P10,000 from A and P10,000 from B.
D. P30,000 from the estate of C or P30,000 from B or P30,000 from C.
52. A, B and C are partners. Their contributions are as follows: A, P60,000; B, P40,000 and
C, services. The partners agreed to divide profits and losses in the following proportions:
A, 35%; B, 25% and C 40%. If there is a loss of P10,000, how should the said loss 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 P3,500; C P3,000
D. A P3,500; B P2,500; C P4,000
53. Using the preceding number, but 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 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 P3,500; C P3,000
D. A P3,500; B P2,500; C P4,000
54. When the manner of management has not been agreed upon, who shall mange the affairs
of the partnership?
A. Capitalist partners
B. Industrial partners
C. Capitalist-industrialist partners
D. All of the partners
55. A, B and C are partners in a partnership business. A contributed P10,000, B contributed
P5,000 and C his services only. After payment of partnership debts, what remains of the
partnership assets is P6,000 only. In the absence of stipulation to the contrary, the share
of C will equal to:
A. That of A
B. P2,000
C. That of B
D. Nothing
56. A, B and C are partners in ABC Co. D owes the partnership P4,500. A, a partner,
received from D a share of P1,500 ahead of partners B and C, giving D a receipt for his
share only. When B and C were collecting from D, the latter was already insolvent.
Which of the following is correct?
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 automatically exhaust first all remedies to collect from D.

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D. B and C can automatically deduct from the capital contribution of A in the

partnership, their respective share in the P1,500.
57. A partnership suffered losses in the first year of its operation. A, a capitalist partner,
cannot contribute an additional share to the capital because of insolvency. Can A be
obliged to sell his interest to the other partners on the ground of such refusal?
A. Yes, A’ refusal to contribute 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 A is paid the value of his interest.
D. No, because his refusal is justifiable.
58. Which of the following is considered prima facie evidence of the existence of a
partnership?
A. Where payment of interest on a loan depends on the profit of the business.
B. The receipt by a person of a share in the profits.
C. The sharing of gross returns of a business.
D. Where the parties are established as co-owners of a property.
59. 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 AP3,000. 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.
60. Using the preceding no. but A issued to D a receipt in the name of the partnership. How
should the payment 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.
61. A, B, C and D are partners. Their contributions are as follows: A, P50,000; B, P30,000;
C, P20,000; D, services. The partnership incurred obligations to third persons which the
firm was unable to pay. After exhausting the assets of the partnership, there still is unpaid
balance of P10,000 to E. Who are liable to E for the payment of the unpaid balance of
P10,000 and how much should each pay to E?
A. A P5,000; B P3,000; C P2,000; D nothing
B. A P2,500; B P2,500; C P2,500; D P2,500
C. A P4,000; B P3,000; C P2,000; D P1,000
D. A P4,000; B P4,000; C P2,000; D nothing
62. One or more but less than all the partners have no authority to perform the following acts,
except:
A. Do any act which would make it impossible to carry on the ordinary business of the
partnership.
B. Submit a partnership claim or liability to arbitration.
C. Renounce a claim of the partnership.
D. Convey partnership property in the ordinary course of partnership business.
63. A, B and C are equal partners in ABC Partnership. The partnership is indebted to D for
P150,000. Partner A is indebted to E for P20,000. D attached and took all the assets of
thepartnership amounting to P90,000. B and C are solvent while A is insolvent and that
he owns is a land valued at P15,000. Which is correct?
A. E has priority to the land of A as a separate creditor

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B. D has priority to the land of A to cover A’s share of the P60,000 remaining liability of
the partnership.
C. B and C have priority to the land of A if they paid D the P60,000 remaining liability
of the partnership.
D. D and E shall both have priority to the land of A in proportion to their claims of
P60,000 and P20,000, respectively.
64. A, B and C are partners. A is an industrial partner. During the first year of operation, the
firm realized a profit of P60,000. During the second year, the firm sustained a loss of
P30,000. So, the net profit for the two years of operation was only P30,000. In the
Articles of Partnership, it was agreed that A, the industrial partner would get 1/3 of the
profit but would not share in the losses. How much will A, the industrial partner will get?
A. A will get only P20,000 which is 1/3 of the profit of the 1st year of operation.
B. A will get only P10,000 which is 1/3 of the net profit.
C. A will get only P20,000 in the first year and none in the second year.
D. A will share in the loss in the second year.
65. A, B and C are partners in ABC Partnership. D represented himself as a partner in ABC
Partnership to E, who, on the belief of such representation, extended P50,000 credit to
ABC Partnership. Assuming only B and C consented to such representation, who will be
held liable to E?
A. E extended the credit to ABC Partnership, so a partnership liability exists, thus, all the
partners, A, B and C are liable
B. B, C and D are partners by estoppels and thus, are liable prorate to E
C. Partners A, B and C who benefited from the credit extended by E are liable.
D. D who made the representation is liable to E
66. A, B and C are equal partners in Santos Brothers Partnership. The partnership is
indebted to PC for P150,000. Partner A is indebted to SC for P20,000 PC attached and
took all the assets of the partnership amounting to P90,000. B and C are solvent while
A is insolvent and all what he owns is a land valued at P15,000.
A. SC has the priority to the land of A as a separate creditor.
B. PC has priority to the land of A to cover A’s share of the P60,000 remaining liability
of the partnership
C. B and C have priority to the land of A if they paid PC the 60,000 remaining liability
of the partnership.
D. PC and AC shall have priority to the land o A in proportion to their claim of P60,000
and P20,000 respectively
67. A and B are partners in a real estate business. A and B were approached by X who
offered to buy a parcel of land owned by the partnership. Thereafter, b sold to A, B’s
share in the partnership. Then, A sold the land to X at a big profit.
A. A is liable to B for B’s share in the profits
B. The partnership is dissolved when A became the sole owner
C. A is not liable to B for the latter’s share in the profits
D. The sale of the land to X is void.
68. One of the following incidents may be a cause for involuntary dissolution of a
partnership. Which is?
A. Termination of the term of the partnership
B. Insolvency of any partner
C. Express will of any partner
D. Expulsion of any partner
69. A and B are equal partners in AB Partnership. Y presented himself as a partner in AB
Partnership to Z, who relying on such representation, extended P50,000 credit to AB
Partnership. Of the two (2) partners only B knew and consented to the representation of
Y. Who should be held liable to Z?
A. Only Y, who presented himself as partner is liable.
B. Since the credit was extended to AB Partnership, a partnership liability was created,
so the two (2) partners and Y are liable.

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C. Partners A and B who benefited from the credit extended to the partnership AB
Partnership shall be liable to Z.
D. B and Y are partners by estoppel and, thus, are liable to Z.
70. A is the capitalist partner and B the industrial partner. A is engaged personally in the
same kind of business the partnership is engaged in.
A. If there are losses, the partnership will bear the losses
B. If there are profits, the profits will be shares by A and the partnership
C. If there are profits, A will give the profits to the partnership
D. A will be excluded from the partnership and pay damages.
71. A is the managing partner of ABC Partnership. X owes A personally and ABC
Partnership P20,000 each. A collected and receive from X, P10,000 and he issued a
receipt wherein it is stated that the amount is applied against his personal credit.
A. The amount received will be applied in favor the partnership credit
B. The amount will be applied in proportion to both credits
C. The amount received will be applied in the credit of A
D. All the partners will decide as to whose favor it will apply
72. Three (3) of the following are rights of a general partner and also of a limited
partner in a limited partnership. Which is not?
A. To inspect and copy at reasonable hours the books of the partnership and have them
kept at the principal place of business
B. To demand true and full information of all matters affecting the partnership and a
formal account of partnership affairs
C. To have dissolution and winding up by decree of court
D. None of the above
73. R, S and T are partners. T is the industrial partner who in addition to his services,
he also contributed capital to the partnership. There is no stipulation as to sharing
of profits and losses. The partnership realized profits of P21,000. The share of T in
the profits:
A. R and will determine T’s share I, in the profits
B. T’s share is P7,000
C. Pro-rata to his contributed capital
D. Nothing, because he is an industrial partner
74. Three (3) of the following are rights of a partner. Which one (1) is not?
A. Right to associate another person to his share.
B. Right to admit another partner.
C. Right to inspect and copy partnership books
D. Right to ask dissolution of the firm at the proper time.
75. A and B are capitalist partners, with C as industrial partner. A and B contributed
P15,000 each to the capital of the partnership. A contractual liability of P40,000
was incurred by the partnership in favor of X. The capital assets of P30,000 shall
first be exhausted thereby leaving an unsatisfied liability of P10,000. X can recover
the amount from:
A. A and B only
B. A, B and C
C. A, B and C and C can recover for reimbursement from A and B
D. Answer not given
76. A, B and C are partners engaged in a retail business. Their contribution is P20,000
each. D is admitted as a new partner with a contribution of P8,000. At the time of his
admission, the partnership has an outstanding obligation to E in the amount of
P80,000. In this case:
A. D is not liable to E for this obligation
B. D is liable to E for this obligation so that amounting to P68,000 will be
exhausted leaving a balance of P12,000. Only A, B and C shall be liable jointly
or pro-rata, out of their separate property.

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C. D is liable to E for this obligation so that after the assets of the partnership will be
exhausted, leaving a balance of P12,000, all the partners shall be liable jointly or pro-
rata, out of their separate property.
D. Answer not given.
77. Which of the following statements is not correct?
A. A general partner in a limited partnership manages the business of the
partnership but cannot perform acts of ownership without the consent of the
limited partners
B. Valid contributions of a limited partner are money and property but not services.
C. Additional limited partners may be admitted into the limited partnership with the
consent of all the partners.
D. A person who is both a general partner and a limited partner is deemed a limited
partner only with respect to the return of his contribution.
78. In the partnership of A, B and C, A was appointed in the Articles of Co-
Partnership as managing partner. As such manager in good faith:
A. His power is revocable even without consent
B. His power can be revocable at any time even without just cause provided
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
79. If a partner in a partnership is insolvent, the first order of preference in the
distribution of his assets are:
A. Partnership creditors
B. Partners contribution to the partnership
C. Separate creditors of the debtor
D. Pro-rata between the separate creditors of the debtor and the partnership creditor
80. This is the order of preference in the liquidation of a partnership:
A. Outside creditors
Partners with respect to their capital
Partners with respect to their profit
Partners aside from capital and profit
B. Partners with respect to their capital
Partners with respect to their profit
Partners aside from capital and profit
Outside creditors
C. Outside creditors
Partners aside from capital and profit
Partners with respect to their capital
Partners with respect to their profit
D. Partners aside from capital and profit
Outside creditors
Partners with respect to their capital
Partners with respect to their profit

15. Where are the several limited partners the members may agree that one or more of the
limited partners shall have the priority over other limited partners as to the return of their
contributions, as to their compensation by way of income, or as to any matter. How shall
this agreement be binding among the partners?
A. It shall be stated in the certificate of limited co-partnership
B. The agreement must be notarized
C. The agreement must be in writing
D. The agreement must be registered in Registry of Property
16. What is the status of the contract of security when a limited partner who has made a loan
to the partnership receive or hold as collateral security any partnership property for his
claim to the partnership?
A. Voidable
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B. Rescissible
C. Unenforceable
D. Void
17. What is the requirement or precondition before a limited partner may receive from the
partnership the share of the profits or the compensation by way of income stipulated for
in the certificate of limited co-partnership during the lifetime of the partnership?
A. There is net income during the period although successive net loss in prior periods
B. The partnership’s total assets are in excess of the partnership’s total liabilities to
third persons
C. There is net loss during the period
D. The partnerships total liabilities to third persons are more than the total partnership’s
assets
18. When may the limited partner demand from the partnership the return of his capital
contribution?
A. On the dissolution of a partnership
B. When the date specified in the certificate for its return has arrived
C. After he has six months’ notice in writing to all other members, if no time is specified
D. Any of the above
19. Which of the following statements concerning a limited partnership is incorrect?
A. Additional limited partners may be admitted after the formation by filling an
amendment to the original certificate without dissolving the limited partnership
B. The retirement, death, civil interdiction, insanity or insolvency of a general partner
dissolves the limited partnership unless the business is continued by the remaining
general partners under a right to do so in articles of partnership or with the consent of
all members.
C. The retirement, death, civil interdiction, insanity or insolvency of a limited
partner dissolves the limited partnership
D. An industrial partner may become a general partner but is not allowed to become a
limited partner.
20. Which of the following statements concerning limited partnership is incorrect?
A. A person may be a general partner and a limited partner in the same partnership at the
same time, provided that this fact shall be stated in the certificate of limited co-
partnership
B. A person who is a general, and also at the same time a limited partner, shall have all
the rights and powers and be subject to all restrictions of a general partner; except
that, in respect in his contribution, he shall have the rights against the other members
which he would have had if he were not also a general partner
C. A limited partner also may loan money to and transact other business with the
partnership, and, unless he is also a general partner, receive on account of resulting
claims against the partnership, with general creditors, a pro rata share of the assets
D. A limited partner who has made a loan to the partnership may receive or hold as
collateral security any partnership property for his claim to the partnership or
receive from a general partner or the partnership any payment, conveyance, or
release from liability if at the time the assets of the partnership are not sufficient
to discharge partnership liabilities to persons not claiming as general or limited
partners

Hatagi kog Hugot gamit ang terms sa Law on Partnership. 10 points.

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