Partnership and Corporation Law

FINALS

Choose the best answer. Write the Letter of your choice.

1. It is an artificial being created by operation of law, having the right of succession, and
the powers, attributes and properties expressly authorized by law or incidental to its
existence.
a. Corporation
b. Partnership
c. Sole proprietorship
d. Business enterprise
2. This theory explains that the corporation is a creature without any existence until it has
received the imprimatur of the state acting according to law.
a. Theory of concession
b. Genossenchaft theory
c. Theory of business enterprise
d. None of the above
3. The reality of the group as a social and legal entity, independent of state recognition and
concession.
a. Genossenchaft theory
b. Theory of concession
c. Business enterprise
d. All of the above
4. A Corporation is not merely an artificial being but more as an aggregate of persons
doing business or an underlying economic unit called “business enterprise.”
a. Business enterprise
b. Theory of Genossenchaft
c. Theory of Concession
d. State theory
5. What do we mean by the doctrine of separate juridical personality
a. A corporation has a personality separate and distinct from that of its stockholders or
members and the officers that represent it.
b. It upholds the artificial being of the corporation
c. It is just a mere fiction.
d. I do not know.
6. What is the piercing the veil of the corporate fiction?
 a. The separate personality of a corporation may be disregarded by the courts if such
corporate fiction is use to defeat public convenience,
b. The separate personality of a corporation may be disregarded by the courts if such
corporate fiction is use to justify wrong, protect from fraud, and defend crime
c. The separate personality of a corporation may be disregarded by the courts if such
corporate fiction is used as a mere alter ego.
d. All of the above.
7. Their value is fixed in the articles of incorporation, which nominal value remains the
same regardless of the profitability of the corporation.
a. Par value shares
b. Non par value shares
c. Common shares
d. Preferred shares
8. It is a basic class of stock ordinarily and usually issued without extraordinary rights or
privileges and entitles the shareholder to pro rate division of profits.
a. Common shares
b. Preferred shares
c. Redeemable shares
d. Founder’s shares
9. What is a close corporation?
a. Its Articles of Incorporation must expressly state that number of stockholders not to
exceed 20.
b. The stocks cannot be listed in the stock exchange nor should they be publicly
offered.
c. A and B
d. None of the above.
10. A kind of corporation which is organized for eleemosynary purpose and where no part
of its income is distributable to its members, trustees, or officers subject to the
provisions on dissolution.
a. Non-stock corporation
b. Religious society
c. Special corporation
d. Foreign corporation

II. Define

1. Foreign corporation
2. Voluntary dissolution
3. Merger
 4. Consolidation
5. Outstanding capital stock

III. Problem solving

Donald, Allen, Israel, Jonathan, and Sanilyn are members of Palawan Music Artists Guild. The
group has been in existence for two years; however they are not yet registered before the
Securities and Exchange Commission. The group has the purpose of enhancing the creative
musical talents and skills of Palawenyo youth through giving them avenue for their music.
Sanilyn wants it to be registered hence, she drafted the articles of incorporation of the group as
well as the by laws. She put therein that the members shall have one share of stock with par
value. Israel commented that it is not possible as the group has eleemosynary purpose; hence it
is a non-stock corporation.

1. What kind of corporation is PMAG?

2. Is Sanilyn correct?
3. Is Israel correct?
4. What are the parts of an Article of Incorporation?

Bonus

What do you think of your teacher?

Thank you for this opportunity. God bless.