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1. A, B, and C are partners contributing services, P20,000 and P40,000 respectively. The distribution of the P80,000 net assets shall be:
A B C
Contribution Service P20,000 P40,000
Distribution of P80,000 profit P20,000 P20,000 P40,000
Distribution of P60,000 loss P0 P20,000 P40,000
Distribution of P80,000 net assets P5,000 P25,000 P50,000
An industrial partner, as regards profits, can only receive in the distribution the same amount as the partner who contributed the smallest amount of capital
(1/4 of the smallest capital, G.R. No. L-3704). Article 140. Should there not have been stated in the articles of co-partnership the portion of the profits to be
received by each partner, said profits shall be divided pro-rata, in accordance with the interest each one has on the co-partnership, partners who have not
contributed any capital, but giving their services, receiving in the distribution the same amount as the partner who contributed the smallest capital.
a. Bilateral
b. Nominate
c. Consensual
d. Real
a. True, True
b. False, False
c. True, False
d. False, True
Shares of stock being personal property, may be the subject matter of pledge and chattel mortgage. Such collateral transfers are however not covered by the
registration requirement of Section 63, since our Supreme Court has held that such provision applies only to absolute transfers, thus, the registration in the
corporate books of pledges and chattel mortgages of shares cannot have any legal effect.
4. One or more but less than all the partners have no authority to perform the following except:
Except when authorized by the other partners or unless they have abandoned the business, one or more but less than all the partners have no authority to:
Assign the partnership property in trust for creditors or on the assignee’s promise to pay the debts of the partnership;
Dispose of the goodwill of the business
Do any other act which would make it impossible to carry on the ordinary business of a partnership
Confess a judgment
Enter into a compromise concerning a partnership or liability
Submit a partnership claim or liability to arbitration
Renounce a claim of the partnership
5. A limited partnership has A, as general partner, B, as limited partner, and C, as an industrial partner contributing P50,000; P50,000 and services
respectively. The partnership failed and after disposing all its assets to pay partnership debts there still remains a note payable in the sum of
P30,000. Against whom can the creditor demand payment?
Industrial partners would also have to pay but may recover from the capitalist partner unless there is an agreement to the contrary, except when the industrial
partner pay losses related to the settlement of the partnership affairs among the partners themselves and has nothing to do with the liabilities of the partners
to third persons. An industrial partner is not exempted from liability to third persons for the debt of the partnership.
6. Statement 1- Any stipulation authorizing the pledgee to appropriate the thing pledged is void and without effect.
Statement 2- If after the auction sale, the thing pledged is not sold, the pledgee can appropriate the thing pledged.
a. True, True
b. False, False
c. True, False
d. False, True
PACTUM COMMISSORIUM. Automatic appropriation by the creditor of the thing pledged or mortgaged upon the failure of the debtor to pay the principal
obligation.
CPAR BUSINESS LAW AND TAXATION 1
7. A pledged his watch to B for P20,000. A failed to pay his obligation. B sold it at public auction for P18,000. Can B recover the deficiency?
8. Using the preceding number, if the sale is for P22,000, can A recover the excess?
9. A mortgaged his car to B for P200,000. A failed to pay his obligation. B sold it at public auction for P180,000. Can B recover the deficiency?
10. Using the preceding number, if the sale is for P220,000, can A recover the excess?
As to deficiency Deficiency can be recovered unless stipulated. (except personal property under Recto Law)
Chattel Mortgage
As to excess Excess belongs to the mortgagor, unless stipulated
If a corporation does not formally organize or commence the transaction of its business or the construction of its works within two (2) years from the date of
its incorporation, its corporate power ceases and the corporation shall be deemed dissolved.
12. Which of the following corporate acts requires the approval of the majority of the outstanding capital stock or of the members of the private
corporation
13. Except for one, every corporation whose character expires by its own limitation, or annulled by forfeiture or otherwise, or whose corporate
existence for other purpose is terminated in any other manner shall nevertheless be continued as a body corporate for three years after the time
when it would have been dissolved for the purpose of the following. The exception is
a. Prosecuting and defending suits by or against it and enabling it to settle and close its affairs.
b. To dispose and convey its property
c. To distribute its assets
d. Continuing the business for which it was established
a. A partnership begins from the moment of the execution of the contract, unless it is otherwise stipulated. (Article 1784)
b. Persons who are prohibited from giving each other any donation or advantage cannot enter into universal partnership. (Article 1782)
c. A particular partnership has for its objects determinate things, their use or fruits, or a specific undertaking or the exercise of a
profession or vocation. (Article 1783)
d. Articles of universal partnership entered into without specification of its nature, only constitute a universal partnership of all present
property.
Article 1781. Articles of universal partnership entered into without specification of its nature, only constitute a universal partnership of profits.
a. Negotiable instruments
b. Shares of stocks
c. Pieces of jewelry
d. Piece of land
16. The following are the rules in case a managing partner collects a demandable debt from a person who also owes the partnership a demand debt,
except
CPAR BUSINESS LAW AND TAXATION 2
a. The sum collected shall be applied to the partnership credit
b. It shall be applied to the two credits in proportion to their amounts
c. The sum shall be fully applied to the partnership credit, if the receipt given is for the account of the partnership
d. The debtor has the right to have the payment applied in his debt to the partner if it should be more onerous to him
Article 1792. If a partner authorized to manage 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.
17. The duty to make disclosure, where otherwise there would be a great and unfair inequality of bargaining position by the use of inside position as
regards relation of directors to stockholders
Special circumstances rule is a principle of corporate law that a director or officer has a fiduciary duty to disclose material inside information to a shareholder
when engaging in a stock transaction under special circumstances.
a. Essentially gratuitous
b. Loan for consumption
c. Object is generally non-consummable
d. Bailor retains the ownership of the thing loaned
The thing to be returned in commodatum is the exact thing loaned, while in mutuum, it is a thing of equal amount of the same kind and quality.
a. The thing pledged to be placed in the possession of the debtor or of a third person by common agreement
b. It is constituted to secure the fulfillment of a principal obligation
c. The pledgor is the absolute owner of the thing pledged
d. The person constituting the pledge has the free disposal of the property
21. A, B, C and D are partners. Their contributions are as follows: A-P50,000; B-P30,000; C- P20,000; and D-services. The partnership incurred
obligations to third persons, which the firm was unable to pay. After exhausting all the assets of the partnership, there is still an unpaid balance
of P10,000. How much should each partner pay to the creditors?
22. A, B and C, co-owners of a particular parcel of land, borrowed P75,000 from X and Y. The three (3) debtors signed a promissory note on
January 10, 2006 promising to pay the creditors on or before April 3, 2006. In addition, the debtors constituted a mortgage on their property in
favor of the creditors. On maturity date, X demanded payment. How much can X collect from C upon maturity of the obligations (creditors are
solidary)?
23. Using the preceding number, if C paid X his share in the obligations, can he, as co-owner of the property, seek a partial release of the mortgage
constituted thereon?
24. The following are considered elements of the contracts of pledge and mortgage. Which is the exception?
a. The pledgor or mortgagor must have the free disposal of the thing pledged or mortgaged
b. The pledgor or mortgagor must be the absolute owner of the thing pledged or mortgaged
c. Both are accessory contracts
d. The thing maybe appropriated if the debtor cannot pay
25. P appointed A as his agent orally to sell his parcel of land for P20,000. ten days later, A sold the same property for P300,000 through a public
instrument executed between him and B. What is the effect and status of sale between A and B?
a. The sale is valid because A was authorized and it was executed in a public instrument.
As a property agent, you must not do anything for a client until they appoint you in writing.
26. Where a director by virtue of his office, acquired for himself opportunity which belongs to the corporation, thereby obtaining profits to the
prejudice of such corporation, must account to the latter for all such profits by refunding the same, unless his act is ratified by
a. A vote at a regular or special meeting by stockholders owning or representing a majority of the outstanding capital stock.
b. A vote of the stockholders owning or representing at least one-third of the outstanding capital stock
c. A unanimous vote of all the stockholders of the corporation
d. A vote of the stockholders owning or representing at least two-thirds of the outstanding capital stock
27. When a borrower uses the thing for a purpose different from the intended, delays its return to the owner, receives the thing under appraisal,
lends to third person or saves his property instead of the thing in cases of emergency, shall be liable even in cases of fortuitous events, because
29. A delivered to B 10,000 pieces of Davao fabricated shell craft jewelry for the purpose of selling them at P1.00 each. Out of the proceeds of the
expected sale, B is to receive a 10% commission. After 3 days, however, B sold all items at P1.50 each to C, but on 30-day credit. A compelled
B to pay. Which is correct?
30. In real estate mortgage, the mortgagor can sell the mortgaged property
31. P wrote a letter authorizing A to sell his parcel of land situated in Boracay. A sold the land in writing to X but the agent (A) did not give the
money to P. The sale of the land by A to X is
a. Authorizing the sale of collateral securities in case the instrument is not paid at maturity.
b. Authorizing a confession of judgment if the instrument is not paid at maturity.
c. Giving the marker an election to require something to be done in lieu of payment of money.
d. Waiving the benefit of any law intended for the protection of the obligor.
37. Where an indorsement is conditional, may the marker make payment although the condition has not been fulfilled?
38. M issues a promissory note payable to P or bearer. Which of the following is not correct?
a. If indorsed by P to A and A also indorsed it to B, B may negotiates the note to C by mere delivery
b. If indorsed by P to A and A also indorses it to B, P is liable to A and B
c. If indorsed by P to A and A also indorses it to B and B negotiates the note to C by delivery. A is liable to B and C
d. If P negotiates the note to A by delivery and A indorses it to B, B may negotiate the note to C by delivery.
a. True, True
b. False, False
c. True, False
d. False, True
a. Where the instrument is negotiated back to a prior party, all intervening indorsements are not necessary to the holder’s title
b. Where the instrument is originally payable to order, the holder may not strike out the payee’s indorsement
c. The indorser whose indorsement is struck out and all indorsers are thereby relieved from liability on the instrument
d. The holder may at anytime strike out an indorsement which is not necessary to his title
41. Which of the following is not summary remedy of the Government to enforce tax collection?
a. Distraint
b. Civil Action
c. Levy
d. Tax Lien
42. Which of the following cases may not be compromised by the Bureau of Internal Revenue Commissioner?
a. Delinquents accounts
b. Cases under administrative protest
c. Fraud cases
d. Cases covered by pre-assessment notice
a. Failure to file any return and pay the tax due thereon.
b. Failure of return with an internal officer other than those designated by law.
c. Willful neglect to file a tax return as prescribed by law.
d. Failure to pay deficiency tax within the prescribed period required by law.
45. Which of the following is not a requisite of tax regulations (BIR revenue regulations):
46. It is said that taxes are what we pay for civilized society. Without taxes, the government would be paralyzed for lack of the motive power to
motivate active and operate.
a. Lifeblood theory
b. Necessity theory
c. Benefit-protection theory
CPAR BUSINESS LAW AND TAXATION 5
d. Reciprocal theory
47. The power to tax is exclusively lodged with the legislature, however, there are exceptions provided by the Constitution, which of the following
is not:
a. Authority of the President to fix tariff rates, import and export quotas, tonnage and wharfage dues, and other duties and imposts
b. Power of local government units to levy taxes, fees and charges.
c. Delegation to administrative agencies for implementation and collection of taxes.
d. Designation to private entities the enforcement and collection of taxes.
49. The following taxes, fees and charges are deemed to be national revenue taxes, except:
50. Which of the following is not an authority of the Bureau of Internal Revenue Commissioner?
a. A protest should be filed by the taxpayer, otherwise the assessment becomes final and no longer be questioned in court
b. A protest may be filed by the taxpayer anytime before the BIR collects the tax
c. The assessment should be made by the BIR collects the tax
d. The assessment shall include only tax proper
53. The authorities of the BIR commissioner include the following, except:
54. The following are grounds to cancel a tax liability by the BIR commissioner, except
55. Which of the following not a requisite to toll the collection of taxes to be made by the Bureau of Internal Revenue, upon proof of the following
to the Court of Tax Appeals:
a. 1.5%
b. 8%
c. 10%
d. 2%
57. One of the following is not an ordinary deduction for purposes of Net Taxable Estate.
a. Funeral expense
b. Medical expense
58. The following person’s signature must appear in the corporations income tax return, except:
a. President
b. Vice President
c. Treasurer
d. External Auditor
62. Deductions from gross estates for transfers for public purposes, except
66. Taxes proceed upon the theory that the existence of the government is a necessity; it cannot continue without the means to pay its expenses; and
for those means, it has the right to compel all citizens and property within its limits to contribute
a. Benefit-Protection Theory
b. Necessity Theory
c. Lifeblood Theory
d. Territoriality Theory
67. Which of the following will not interrupt the running of the prescriptive period for assessment and collection of taxes:
a. When the Commissioner is prohibited from making the assessment or beginning distrait and levy or a proceeding in court and for
thirty (30) days thereafter.
b. When the taxpayer requests for the reinvestigation which is granted by the Commissioner.
c. When the taxpayer is out of the Philippines.
d. When the taxpayer cannot be located in the address given by him in the return.
68. Which of the following are not deputized agents for the collection of national internal revenue taxes?
a. The Commissioner of Customs and his subordinates with respect to the collection of national internal revenue taxes on imported
articles.
b. The head of the appropriate government office and his subordinates with respect to the collection of energy tax.
c. Banks duly accredited by the Commissioner with respect to receipt of payments of internal revenue taxes authorized to be made
through banks.
a. Department of Finance
b. Bureau of Internal Revenue
c. Legislative Department
d. Executive Department
70. The powers and duties of the Bureau of Internal Revenue comprehend the following, except?
71. The power to interpret the provisions of the Tax Code and other tax laws shall be under the exclusive and original jurisdiction of the:
72. The power to decide disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties imposed in relation thereto, or
other matters arising under the Tax Code or other laws administered by the Bureau of Internal Revenue is vested with:
73. It is the official action of an administrative officer in determining the amount of tax due from a taxpayer, or it may be a notice to the effect that
the amount stated therein is due from the taxpayer with a demand for payment of the tax or deficiency stated therein.
a. Tax investigation
b. Tax audit
c. Tax assessments
d. Tax mapping
74. To escape a liability for a deficiency estate tax, after paying the estate tax, must secure a written discharge of personal liability from:
a. The heirs
b. The commissioner
c. The probate court
d. The court where the estate is being settled
75. When an estate is settled extra-judicially, the estate tax return may be filed and paid:
a. By any of the heirs, with the right of reimbursement from the other heirs
b. Only by the heir with written authority from the other heirs
c. By each of the heirs, the payment being for his distributive share in the estate tax
d. None of the above
a. True; False
b. True; True
c. False; True
d. False; False
77. Net capital loss carryover will not be claimed by, except:
a. Individual taxpayers
b. Estate taxpayers
c. Trust taxpayers
d. Corporate taxpayers
78. Decedent who is married with a surviving spouse and one legitimate child and two illegitimate children. Left the following properties.
a. P1,250,000
b. P2,250,000
c. P1,150,000
d. P2,450,000
79. The following are the reasons which necessitates the filing of an administrative claim for refund with the BIR, except:
80. 1st Statement: A resident corporation is allowed to deduct depreciation expense regardless of the property’s location.
2nd Statement: A private educational institution may at its option elect either to deduct capital expenditures during the taxable year or to deduct
allowable for depreciation thereof.
a. True; False
b. True; True
c. False; True
d. False; False
END