Brokenshire College SOCSKSARGEN, Inc.

Ced Avenue, National Highway, Lagao, General Santos City, South Cotabato

PRELIM EXAMINATION
Law on Partnership and Corporations

Name:

General Instruction: Write the correct answer.

Multiple Choices

1. 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
2. A, B and C are partners in a partnership. C contributed his industry. After payments of the partnership’s obligations,
only P6,000 cash remains. No other assets. In the absence of terms to the contrary, the share of C in the remaining
assets is:
A. Equal to share of A
B. Equal to the share of B
C. P2,000
D. Nothing
3. 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.
4. Three (3) of the following are similarities between a partnership and a corporation. Which is not?
A. The individuals composing both have little voice in the conduct of the business
B. Both have juridical personality separate and distinct from that of the individuals composing them.
C. Like a partnership, a corporation can act only through agents
D. Both are organizations composed of an aggregate of individuals
5. The partnership is insolvent. These are preferred as regards to the partnership property.
A. Partnership creditors
B. Partners separate creditors
C. Partners with respect to their capital
D. Partners with respect to their profits
6. Bears the loss of property contributed to the partnership
A. Capitalist partner
B. Limited partner
C. None of the above
D. Partners contributing usufructory rights
7. Which of the following is an essential element of partnership?
A. There must be a contribution of money, property, or industry to a common fund.
B. It must an association for profit with the intention to divide the profits among themselves.
C. There must be a valid and voluntary agreement.
D. All of the above.
8. Which of the following liabilities of the partnership shall rank first in the order of payment?
A. Those owing to creditors other than partners
B. Those owing to partners in respect to profits
C. Those owing to partners in respect to capital
D. Those owing to partners other than for capital and profits
9. They have priority if the partnership is insolvent:
A. Separate creditors
B. Partnership creditors
C. Both A and B
D. None of the above
10. When cash or property worth P3,000 or more is contributed as capital. The Articles of CoPartnership shall be in a
public instrument and be registered with the Securities and Exchange commission. If the said requirements are not
complied with:
A. It will render the partnership void.
B. It will not affect the liability of the partnership and the partners to third parties.
C. It will not give a legal personality to the partnership.
D. It will give the partnership a de-facto existence

True or False

1. The contribution of a limited partner may be cash, property or service.

2. A limited partner who takes part in the management of the business of the partnership is not a general partner but
he shall be liable as a general partner.
3. A partner cannot assign his interest in the partnership to a third person without tht consent of the other partners.
4. A partner’s interest in the partnership is his personal property.
5. The creditor of each partner shall be preferred to those of the partnership as regards the partner’s separate property.
6. All the partners in a general partnership are considered managing partners if thee is no stipulation as to who shall act
as managing papartn.
7. A partner is liable to the partnership for whatever property he agrees to contribute without necessity of demand.
8. The creditor of each partner shall be preferred to those of the partnership as regards the partner’s separate property.
 Brokenshire College SOCSKSARGEN, Inc.
Ced Avenue, National Highway, Lagao, General Santos City, South Cotabato

PRELIM EXAMINATION
9. If the capital contribution of the partners amount to P3,000 or more the contract of partnership must be in public a
public document, otherwise the contract is void.
10. 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 document.

Enumeration:

1. The Essential features of a Partnership.

2. The Elements of the Partnership.

Case Analysis:

A and B are partners. On June 15, 2009 when the total obligation of the partnership totaled P80,000. C was admitted
as new partner. At the time C’s admission, the partnership creditors were M for P50,000 and N for P30,000. After June
15, the partnership borrowed from O P20,000 and P40,000 from P. On December 15, 2009, the partnership became
insolvent leaving an obligation totaling P140,000 and partnership assets amounting to P30,000. The creditors are going
after the separate properties of the partners to satisfy their remaining claims. How are the creditors’ claims satisfied?
PLEASE JUSTIFY YOUR ANSWER. (20pts)