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Group 2 1. A & O formed a partnership with O as the managing partner.

D owed P10,000 from the partnership at 14% interest per annum and at the same time, D also owed P10,000 from O, personally at 18% interest per annum. D paid O P1,800. Is Ds payment to O allowable? a. No. The payment of D should be shared proportionately by the partnership and O, P900 for O and the other P900 to the partnership. b. No. D should pay P1,008.00 to O and P792.00 for the partnership. c. Yes. D can prefer and is allowable to apply for payment the whole amount of P1,800 to O being more onerous or burdensome on his part. d. Yes. D can pay P1,008.00 to O and 792.00 to the partnership. 2. Upon dissolution of A & Os partnership, some of the partnerships credits were assigned to each of them in proportion to their profit-sharing agreement and for each of them to assume responsibility. O being so diligent, she collected a total of P50,000.00 and when A learned of it, he asked for his share, which O denied. Is Os denial proper? a. Yes. Since partnership is already dissolved and each of them assumed their respective responsibility for the credits. O should get the fruits of his diligence and hard labor. b. Yes, because it is his own share and A has nothing to do with it. c. No, O should share his collections with A being previous partners. d. No, O in applying the principle of community and equality should share it with A. 3. X and Y are partners in a certain business, X being the managing partner. Z owes X Php15,000.00 and the partnership Php20,000.00, and both credits are demandable. Z pays X Php3,500.00 and the latter issued a receipt in his name. Should X collect the entire amount? A. Yes, X should collect the entire amount as Z is also liable to him. B. Yes, X should collect the entire amount especially that he issued already his official receipt and the partnership did not know of the fact of payment. C. No, X should not collect the entire amount of Php3,500. He should collect only Php1,500 for himself and apply the balance of Php2,000.00 to the partnership credit. D. No, X may not collect the entire amount of Php3,500, instead he may share Php1,500 to the partnership credit and the Php2,000 will be for himself. 4. When may the managerial and administrative powers given to a managing partner be revoked or withdrawn at anytime? a. After a majority of the partners agree to the need for a new agent. b. When such power, not being a condition in the original contract of partnership was given by the generic or same majority of partners that recognize need to appoint another agent among themselves. c. After revision of the contract of partnership stipulating such revocation and ratified by the appointment of a new manager. d. After express consent of all partners, or a majority holding controlling interest, evidenced by a duly signed memorandum. 5. Which of the following statement is true? a. Partnership is the principal and each partner is an agent of the partnership

b. Partnership is consummated even agreement is unperformed in contract which to be effected in future time A. Statement a is correct C. both statements a and b are correct B. Statement b is correct D. neither a statement nor b is correct 6. The expiration of the term thus fixed or the accomplishment of the particular undertaking specified will cause the; a. automatic dissolution of the partnership b. continued existence upon implied agreement of partners A. Statement a is correct C. both statements a and b are correct B. Statement b is correct D. neither statement a nor b is correct 7. A, an industrial partner of B and C who are capitalists in BALUT selling business, engages himself in selling fruits which is expressly prohibited in the partnership. In effect, B and C exclude him from the firm on the ground of conflict of interest. However, A filed an action for damages contending that he is only selling fruits which is not in any way in conflict with their partnership. Whose contention is correct? a. A c. both A And B and C b. B and C D. None of the above 8. B, one of the three capitalist partners is of the opinion that an additional contribution to the common fund would save the business. C, the other partner refuses to contribute. As a result, B obliged C to sell his interest to either B or D. Is action of B correct? a. Yes because there is an imminent loss of the business b. Yes because C refuses deliberately to contribute c. No because there is no agreement prior to their partnership d. No because it is only his opinion that business is in imminent loss 9.. E, F, G, H and I organized a general partnership, with E, F and G as industrial partners and H and I as capitalist partners, who contributed P35,000 and P45,000 to the common fund, respectively. E ,F and G were appointed as managing partners, without any specification of their respective duties. When the firm commenced business operations, the three appointed Y as accountant of the company. One year later, F decided to dismiss Y and was with the conformity of E, but was opposed by G. How can the conflict be resolved? a.The conflict shall be resolved by the decision of the majority of the managing partners. b. The conflict shall be decided by I and if he cast his vote in favor of G, Y is out of job. c. The conflict shall be decided by I and if he cast his vote in favor of F, Y still has a job. d. None of the above. 10. May a partner form a sub-partnership with a third person with respect to his interest in the partnership? a. Yes, provided with the consent of the other partners. b. Yes, provided that he is a managing partner and with the consent of the other partners. c. Yes, even without the consent of the other partners. d. Yes, because it will affect the composition, existence, or operations of the firm.

11. Can a capitalist partner engage in a business other than that of the partnership? a. Yes, provided that it is for the account of another and shall bring to the common funds any profits accruing to another for their transactions. b. No, because the prohibition of the capitalist partner to engage in business is absolute. c. Yes, they can engage for their own account in any operation which is of the kind of business in which the partnership is engaged. d. No, they cannot engage for their own account in any operation which is of the kind of business in which the partnership is engage, unless there is stipulation to the contrary. 12. When may a partner demand for a formal accounting of partnership affairs? 1. If he is wrongfully excluded from the partnership business or possession of its property by his co-managers. 2. If the right does not exist under the terms of any agreement. 3. As provided by Article 1807. 4. Whenever other circumstances under it just and reliable. A) Both Nos. 2 and 3 B) Both Nos. 3 and 4 c. Only No. 3 d. All of the above. GROUP 3 1. Which of the following statements is false; a. A partner has an equal right with his co-partners to possess specific partnership for partnership purposes. b. c. d. A partners right in specific partnership is not subject to payment of legal support A partners interest in the partnership may be assigned under certain conditions. In a specific partnership property a partner can assign his right to anyone.

2. The following are not usual ways of carrying on the business of a Partnership except; a. b. c. d. 3. a. b. c. Entering into a compromise concerning partnership claim. Renunciation of a partnership claim. A partner may enter into a separate obligation to perform a partnership contract. Disposal or alienation of the goodwill of the business _________ refers to the remains of a fund appropriated for a particular purpose. Profit Loss Surplus

d.

Excess

4. X is concerned with ABC Marketing, a partnership where A is a relative of X. To secure a better credit X represented himself as having half interest in the firm. The misrepresentation is believed and relied upon by Z who gave credit to ABC marketing. As role in the partnership is _______ a. partner by estoppel b. partner by interest c. managing partner d. capital partner 5. Which is not one of the status and rights of assignee a) b) c) d) becomes a partner in the partnership. Entitled to profits to which the assigning partner is entitled. Not entitled to interfere in the administration of the partnership. Can not demand any info or account of the firms transactions or inspect books

6. A _______ desiring to give notice to a partnership of some matters pertaining to the partnership need not communicate with all partners. e) Co-partner f) All partners g) Third person h) SEC 7. All partners are liable with the partnership i. Primarily ii. Secondarily iii. Jointly iv. Solidarily 8. Under Article 1824, the reason for the imposition of the liability for acts or omission or breach of trust is: v. Public welfare vi. Public policy vii. Public good viii. Public need 9. _____ is a bar which precludes a person from denying or asserting anything contrary to that which has been established as the truth by his own deed or representation ix. Liability x. Negligence xi. Estoppel xii. Misrepresentation

10. Liability when there is no existing partnership and all those represented as partners consented to the representation xiii. estoppel xiv. pro-rata xv. separate xvi. joint GROUP 4 1. The determination of the value of each partners interest in the partnership is a part of which process? A. Dissolution B. Termination C. Winding up D. Cancellation of partnership registration 2. After dissolution, the partnership has limited existence for the purpose of the following, except: A. making good all outstanding engagements B. taking and settling all accounts C. cessation of the relations of the partners among themselves who remain as co-partners until termination of partnership D. collecting all the property, means and assets of the partnerships existing at the time of its dissolution for the benefit of all interested. 3. A partner who breaks off the partnership in bad faith discharges his co-partners from all liabilities to him and frees himself from his obligations to them. A. True B. False, he does not discharge his co-partners from all liabilities to him C. False, he does not free himself from his obligations to them D. False, his co-partners must be in bad faith, too 4. These are grounds for dissolution by decree of court, except: A. Lasting incapacity B. Refusal, with justifiable cause, to render accounting of partnership affairs C. Continuous petty arguments whereby partners lose their confidence and cooperation D. Business carried on at a loss during application for judicial decree of dissolution but currently making a profit 5. The winding up of the dissolved partnership may be done judicially upon cause shown by the following, except: A. Partner B. Creditor C. His legal representative D. His assignee 6. They are authorized to wind up, except: A. The partners designated by agreement

B. In the absence of such agreement, all the partners who have not wrongfully dissolved the partnership C. The legal representative (executor or administrator) of the last surviving partner (when all the partners are already dead), not insolvent D. Receiver appointed by the partnership 7. The following are the powers of the liquidating partner, except: A. Make new contracts B. Raise money to pay partnership debts C. Incur obligations to complete existing contracts or preserve partnership debts D. Incur expenses necessary in the conduct of litigation 8. A right of a partner who has not caused the dissolution wrongfully: A. To have partnership property applied for the payment of its liabilities and to receive in cash or securities his share of the surplus B. To indemnify for damages other partners who are not guilty of wrongful dissolution C. To continue the business in the same name during the agreed term of the partnership, by themselves or jointly with others D. To possess partnership property but only upon judicial decree should they decide to continue the business 9. Which of the following is not a cause for dissolution of partnership by change in membership? A. Partner retires B. Partner withdraws C. Other partners assign their assets to sole remaining partner D. All the partners assign their rights in partnership property to strangers 10. Person liable to render an account A. Winding up partner B. Surviving partner C. Person continuing the business D. All of the above E. A or B only answers to quiz 1. c 2. c 3. c 4. b 5. b 6. d 7. c 8. c 9. c 10. d

GROUP 5 1. The following are correct, except: a. Limited partners contribute to the capital, share in the profits, and participate in the management of the business. b. Limited partners are not personally liable for the partnership obligations beyond their capital contributions c. Partnership debts are paid out of a common fund and the individual properties of the general partners. d. A limited partner may engage in a business similar to that of the partnership. 2. Allowable transactions of a limited partner: I. Granting loans to the partnership II. Receiving or holding as collateral security any partnership a. Both I and II are correct b. Both I and II are incorrect c. Only I is correct d. Only II is correct 3. The following are conditions that must exist before contributions by a limited partner can be returned, except: a. All liabilities of the partnership have been paid b. The consent of all members has been obtained when the return may be rightfully demanded c. The certificate is cancelled or so amended as to set forth the withdrawal or reduction of the contribution d. The assets of the partnership are sufficient to pay any unpaid liabilities 4. A limited partner is liable to the partnership for the I. For the difference between his contribution as actually made and that stated in certificate as having been made II. For any unpaid contribution which he agreed to make at a future time a. Both I and II are correct b. Both I and II are incorrect c. Only I is correct

d. Only II is correct 5. Which of the following pertains to a substituted limited partner? I. An assignee shall have the right to become a substituted limited partner if majority of the members consent thereto. II. Being a substituted limited partner only, he has no right to require any information or account of the partnership transactions. a. Both I and II are correct b. Both I and II are incorrect c. Only I is correct d. Only II is correct 6. One of the following is a cause for dissolution of a limited partnership: a. Misconduct of a limited partner b. Retirement or death of a limited partner c. Fraud practiced on the general partner by the limited partner d. Mutual consent of the partners before the expiration of the firms original term 7. When a limited partnership has been duly dissolved, the partnership liabilities shall be settled in the following order: a. 1st those due to creditors 2nd those due to limited partners in respect to profits 3rd those due to general partners in respect to profits b. 1st those due to general partners in respect to profits 2nd those due to limited partners for return of capital contributed 3rd those due to creditors c. 1st those due to general partners in respect to profits 2nd those due to creditors 3rd those due to limited partners for return of capital contributed d. 1st those due to creditors

2nd those due to limited partners in respect to their profits 3rd those due to limited partners for return of capital contributed

8. A certificate of the limited partnership shall be amended when: a. A general partner retires b. A person is admitted as a general partner c. All of the above d. None of the above 9. The following acts constitute taking part in the control of the business, except: a. Supervision over a superintendent of the business of the firm b. Selection of who will be the managing partners c. Consultation on one occasion with the general partners d. No exception, all are correct 10. The surname of a limited partner may appear in the partnership when: a. Such was deliberated on by the partners through a majority vote. b. It was so stated in the articles of partnership. c. It is also the surname of another limited partner or all of the limited partners. d. It is also the surname of a general partner. Answer Key: 1. A 2. C 3. B 4. A 5. B 6. D 7. D 8. C 9. C 10. D

GROUP 6

1.

The relationship of third party with principal and agent are described as follows: a. An agents contract is not his own but his principals, a third partys liability on such contract is to the principal and not to the agent, and the liability to such third party is enforceable against the principal, not to the agent. b. The relationship of the third party with whom the agent has contracted, to the principal is the same as that in a contract in which there is an agent.

A. B.

Both statements are correct Statement A is correct

C. Both statements are incorrect D. Statement B is correct 2. In the determination of the existence of agency, the following may be considered except A. B. The manner in which the parties designate the relationship The fact that one represents and is acting for another

C. Inference from mere relationship or ties D. Actual intention or intention naturally inferable from words or actions 3. The following conformed not on the doctrines and principles of implied agency and agency by estoppel, except A. Agency by estoppel should be restricted to cases in which the authority is not real and apparent B. Implied agency is a fact that need not be proved by deductions or inferences from other facts because implied agency is an actual agency C. An apparent agent is not an agent at all and as against the principal has no rights as an agent but has such right in respect to third person D. As to third person, the principal is equally liable in both agency by estoppel and implied agency thus reliance in both cases is not necessary 4. The limits of authority of an agent are not deemed exceeded despite deviation, if his performance of the agency proved to be more advantageous to the principal than that specified in the authority. Thus, the principal cannot be held liable if the limitations of the power created by him could not have been known by the third person. A. True, because by the fact that the power could not have been made known is tantamount to non-disclosure of the principal.

B. False, because principal cannot be bound by acts of the agent beyond the scope of his authority C. True, third persons dealing with an agent do so at their risk and are bound to inquire as to the scope of his power D. False, because limitation of power of the agent not being known by third the person is a qualification to the rule when principal is bound by acts of agent beyond his power. 5. In transactions and compensation of agents and / or broker a. A broker is regarded as the procuring cause if his efforts are the efficient cause on which the negotiations resulting in a sale begun b. When there is a close, proximate and causal connection between the brokers effort and the principals sale of his property, the broker is entitled to his commission. A. B. Statement A is false and B is true Statement B is false and A is true

C. Both statements are true D. Both statements are false ANSWERS: 1. B, 2. C, 3. C, 4. D, 5. A Choose the correct answer. 1. The agent is bound by his acceptance to carry out the agency and is liable for the damages which without the diligence of a good father of the family, the principal may suffer. a. b. absolute with exception c. false based on Art. 1884 d. agent is not liable unless he has voluntarily bound himself

2. The agent shall be liable for damages if, there being a conflict between his interests and those of the principal, he should prefer his own. a. b. alwaystrue exception arises if there is consent from principal c. based on Art. 1887 d. none of the above

3. If solidarity has been agreed upon, each of the agents is responsible for the nonfulfillment of the agency, and for the fault or negligence of his fellow agents, except in the latter case when the fellow agents acted beyond the scope of their authority. a. true c. not fault or negligence but fraud or negligence of his fellow agents

b. 4.

false

d. the exception stated is not correct

1. Del Credere agent can not be held liable to damages arising from sale.

2. The liability of Del Credere agent is contingent depending on the purchase price. a. b. 1 & 2 are true 1 & 2 are false c. 1 is true, 2 is false d. 1 is false, 2 is true

5. 1. If the agent has been authorized to lend money at interest, by virtue of such authority, he can thereafter borrow the same. 2. The agent owes interest on the sums he has applied to his own use from the day on which he did so including those he owes even after the extinguishment of the agency. a. 1 & 2 are true b. 1 & 2 are false Answers 1. C 2. D 3. A 4.C 5. D 1. Which of the following does not amount to ratification? a. Receipt of premiums and demand for additional security of the principal. b. Silence of the principal. c. Act of the principal in collecting by court action part of the loan made to unqualified buyers. d. Approval by the principal by the accounts submitted by the agent. 2. The principal is not liable for the expenses incurred by the agent in the following cases, EXCEPT: a. If the agent acted in contravention of the principals instructions. b. When the expenses were due to the fault of the agent. c. When the agent incurred them without knowledge that an unfavorable result would ensue, if the principal was aware thereof. d. When it was stipulated that the expenses would be borne by the agent or that the latter would be allowed only a certain sum. 3. An agency cannot be revoked under the following circumstances, EXCEPT: a. If the agency has been constituted in the common interest of the principal and the agent. b. If it is the means of fulfilling an obligation already contracted. c. If a partner is appointed manager of a partnership in the contract of partnership and his removal from the management is unjustifiable. c. 1 is true, 2 is false d. 1 is false, 2 is true

d.

If a bilateral contract depends upon it.

4. In the following statements, which of the following choices is correct? Statement 1: The termination of the agency will necessarily free the principal from liability. Statement 2: Where an agency is created for a fixed period, expiration of such period ends the agency, even though the purpose for which the agency was created has not been accomplished. a. Statement 1 is TRUE. b. Statement 2 is FALSE. c. Statement 1 is FALSE. d. Both statements are TRUE. 5. The agent is not liable for the expenses incurred by him when he incurred them with knowledge that unfavorable result would ensue and the principal was not unaware thereof. a. TRUE b. FALSE c. Statement 1 is Misleading d. With Exception 6. A mode of extinguishment of an agency which does not admit of any exceptions, EXCEPT: a. Death of the agent. b. Withdrawal of the agent. c. Civil interdiction of the agent. d. None of the above. 7. The appointment of a new agent for the same business or transaction revokes the previous agency form the day on which notice thereof was given to the former agent without prejudice to: a. Article on agency for purpose of contracting with specified third persons. b. Revocation of agency not causing prejudice to third persons who acted in good faith without knowledge of the revocation. c. Both A & B are TRUE. d. Both A & B are FALSE. 8. a. b. c. d. The following, EXCEPT ONE, are TRUE on the principle of Estoppel and Ratification. Ratification rest on intention; estoppel rest on prejudice. In estoppel, substance is inducement; in ratification, substance is confirmation. Ratification is after the act is done; estoppel is before the act is done. Ratification affects only parts of the transaction; estoppel affects entire transaction.

9. Statement A: If the reason for the extinguishment of agency is not true, the agent can insist on reinstatement with damages. Statement B: Implied in every contract is the understanding that it shall be capable of being carried out legally at the time called for by the contract, thus agency then terminates if a change in law makes purpose of agency impossible or unlawful. a. Statement B is TRUE; A is FALSE. b. Statement B is FALSE; A is TRUE.

c. d.

Both statements are FALSE. Both statements are TRUE.

10. Why solidarity is the rule when 2 or more persons have appointed an agent? a. To necessarily bind the principal in all the acts of the agent. b. Because the principals have all concurred in the appointment of the same agent. c. Because of the common transaction/undertaking. d. To fix the liability of the principals with particularity since the appointments are separately done. Answers: 1. C, 2. C, 3. A, 4. C, 5. A, 6. D, 7. A, 8. D, 9. A, 10. C GROUP 7 1. Which of the following is true? a. Express trust come into being by operation of law. b. Implied trust are those created by intention of the trustor or of the parties. c. A person who establishes a trust is called the trustee. d. Express trusts are those created by the direct and positive acts of the parties. 2. It refers to a person who establishes a trust. a. trustee b. trustor c. beneficiary d. receiver 3. The following are the characteristics of a Trust except a. A trust refers to specific property or to other things. b. It is fiduciary relationship c. The legal title is held by one, and the equitable title or beneficial title is held by another. d. A trust is created by law or by agreement. 4.Statement No 1. No express trust concerning an immovable or any interested therein may be proved by parol evidence. Statement No 2. No particular words are required for the creation of an express trust, it being sufficient that a trust is clearly intended. a. Statement No 1 is True and Statement No. 2 is false b. Statement No 1 is false and Statement No. 2 is true c. Both statements are true. d. Both statements are false 5. The following are implications of an impliedor express trust except: a. Purchase of property where the title is not given to payer but to another.

b. The Donee who does not get full ownership of Benefit c. Co-ownership d. An administrator or executor to the property.

6. It is the right to the beneficial enjoyment of property, the legal title to which is vested in another. a. Trust b. trustee c. trustor d. beneficiary 7. How an express trust is created? a. By conveyance to the trustee by an act inter vivos or mortis causa b. By admission of the trustor that he holds the property, only as trustee. c. Both a and b. d. None of the above 8. The following are the effects if the trustee declines except a. The trust is automatically terminated. b. The trust ordinarily continues even if the trustee declines. c. A new trustee has to be appointed; otherwise the trust will not exist. d. The court will appoint a new trustee, unless otherwise provided for in the trust instrument. 9. For the trust to be effective, the beneficiary must accept: a. expressly b. impliedly c. presumably d. all of the above 10. How are express trust ended? a. Mutual agreement by all the parties. b. Fulfilment of the resolutory condition. c. Both a and b d. None of the above