TTH 7:30-9:00 pm

1. I. In a stock corporation, stockholders or the corporation can vote or represent shares that have
never passed to the ownership of stockholders
II. In a non-stock corporation, each member shall be entitled to one vote and must be in accordance
with the law and by laws which the voting rights is not attached to membership.
Which foregoing(s) is correct?
A. Statement I is correct
B. Statement II is correct
C. Both statements are false
D. Either I and II is correct
2. W, X, Y, and Z organized a Corporation called Wexsagez Corporation , an Article Incorporation was
prepared, signed and acknowledged before a notary public and filed with the SEC. Furthermore
corresponding certificate of incorporations has been approved and issued. However in foregoing details of
the board of directors, X, Y and Z are not residing in the Philippines. What is the status of the corporations?
A. De jure corporation
B. De facto corporation
C. Corporation by estoppel
D. Corporation by prescription
E. None of the above
3. Where the articles of incorporation provide for non-voting shares in the cases allowed by this Code,
the holders of such shares shall nevertheless be entitled to vote on the following matters except:
I. Amendment of the articles of incorporation;
II. Sale, lease, exchange, mortgage, pledge or other disposition of all or substantially all of the
corporate property;
III. Merger or consolidation of the corporation with another corporation or other corporations;
IV. Dissolution of the corporation.

A. I
B. II
C. III
D. IV
E. None of the above.
4. For an entity to be considered as Government-owned or controlled corporation, it must either be
organized as a stock or non-stock corporations. Identify which of the following statements are must
be concur before one may be classified as a stock corporation:
I. They must have members and must not distribute any part of their income to said members.
II. That it has capital stock divided into shares.
A. I
B. II
C. Neither I nor II
D. Both I and II
5. The following statements are grounds for rejection and disapproval of the articles of the incorporation or
amendment, except:
a. That the articles of incorporation or any amendment thereto is not substantially in accordance with
the form prescribed herein;
b. That the percentage of ownership of the capital stock to be owned by citizens of the Philippines has
been complied with as required by existing laws or the Constitution.
c. That the purpose or purposes of the corporation are patently unconstitutional, illegal, immoral, or
contrary to government rules and regulations;
d. That the Treasurer's Affidavit concerning the amount of capital stock subscribed and/or paid is false.
6. I. The 2 year and the 5 year rule are not applicable if the failure to organize or continuously operate
is due causes under the control of corporation.
II. There is no minimum authorized capital stock as long as the paid-up capital is not less than P5000
a. Both statements are true
b. Both statements are false
c. Statement I is false, Statement II is true
d. Statement I is true, Statement II is false
7. WagPaasa Corp is a stock corporation that has an authorized capital stock of 4 500 000. If the company
agrees to have a common stock between 5 subscribers and Taylor Ring Shop is one of the subscribers, how
much should she paid AT LEAST out of her total subscription for her to be one of the subscribers of the said
capital stock?
a. 4 500 000
b. 225 000
c. 252 000
d. 900 000
8. The following are the acts constituting formal organizations, except:
a. Entering into contracts or negotiation for lease or sale of properties to be used as business
b. Adoption of by-laws and filing for the same with the SEC
c. Establishment of the Principal Office
d. Providing for the subscription and payment of its shares of stock
9. Which of the following is a qualification of a director or trustee?
a. The number of directors or trustees shall not be less than 5 nor more than 15.
b. They must be of legal age.
c. Every director must own at least one share of the capital stock of the corporation
d. Directors must be a natural persons
10. Which of the following is not a requisite for removal?
a. The removal should take place at a regular or special meeting duly called for the purpose.
b. The director or trustee can only be removed by a vote of the stockholders representing at least 2/3 of the
outstanding capital stock or 2/3 of the members entitled to vote in case of non-stock corporations.
c. There must be a previous notice to stockholders or members of the corporation of the intention to propose
such removal at the meeting.
d. The ordinary meeting of the stockholders or members of a corporation for the purpose of removal must
be called by the president on order of the chairman or on written demand of the stockholders representing or
holding at least a majority of the outstanding capital stock or a majority of the members entitled to vote.
11. Which of the following is not an essential requirement for the election of directors?
a. The election must be by ballot.
b. No delinquent stock shall vote or be voted for.
c. Stockholders, representing a majority of the outstanding capital stock of the corporation must be
preaent, either in person or by proxy.
d. The director or trustee must be capacitated and in legal age.
12. The corporate officers must formally organize by electing of?
a. Vice president, secretary, auditor and other officers
b. President, treasurer and members
c. President, secretary, treasurer and other officers
d none of the choices.
13. The following are the requirements to enter into into a management contract except;
a. Approval by the majority of the quorum of the board of directors.
b. Ratification by the stockholders owning at least majority of the outstanding capital stock.
c. Approval by the stockholders of the managed corporation owning at least 2/3 of the total outstanding
capital stock entitled to vote.
d. Ratification by the stockholders representing the same interest of both managing and the managed
corporations own or control more than 2/3 of the total outstanding capital stock entitled to vote of the
managing corporation.
14. It is one of the powers of corporations which states that a private corporation may extend or shorten its
term as stated in the articles of incorporation.
a. Power to extend or shorten corporate term
b. Power to acquire own shares
c. Power to declare dividends
d. Power to deny pre-emptive right.
15. Section 36. The powers and authority of a corporation are classified into three; namely express powers,
incidental powers and implied powers. Below are example of incidental powers, EXCEPT:
a. Power of succession
b. Power to increase business
c. Power to make by-laws
d. None of the above
16. Section 39. The right of pre-emption given to stockholders of a corporation shall apply to all issuance or
disposition of shares of any class, such as:
A. When the capital stock of a corporation is increased and new shares are issued.
B. When shares from the unsubscribed portion of the original or authorized capital stock are issued.
C. both A & B
D. Neither A & B
17. Statement 1: Before declaration, stockholders have no individual or property interest in the profits
of the corporation and are entitled to any portion of the accumulated earnings until the declaration
of the dividends or its equivalent.
Statement 2: After declaration, declaration of a dividend creates a debt from a corporation to the
stockholder, who becomes a general creditor until the fund is actually set aside for the payment of
the dividend, when he becomes a preferred creditor.
A. Statement I & II are true.
B. Statement I & II are false.
C. Statement I is true, Statement II is false
D. Statement I is false, Statement II is true
18. I. The adoption and filing of by-laws is also a condition precedent.
II. By-laws must be submitted prior to incorporation or within three months after receipt of official
notice of the issuance of certificate of incorporation by SEC.
a. Only I is true
b. Only II is true
c. Both are true
d. Both are false
19. Agreement on the by-laws for others to preside the meeting is invalid as only the president shall
preside at all meetings of the directors or trustees as well as of the stockholders or members.
a. True
b. False
c. Somewhat true
d. Cannot be determined
20. Requirement to effect the amendment of by-laws of a corporation.
a. Majority vote of the board of directors
b. Majority vote of outstanding capital
c. Vote of 2/3 of outstanding capital stock
d. Majority vote of the board of directors and majority vote of the outstanding capital stock.
21. Regular meetings of directors or trustees.
a. Annually on a date fixed in the by-laws, or if not fixed, on any date in April.
b. Any time when deemed necessary or as provided in the by-laws.
c. Monthly unless the by-laws provide otherwise.
d. Any time upon the call of the president or as provided in the by-laws.
22. I. Regular and special meetings of directors of every corporation shall be held monthly, unless the
by-laws provide otherwise.
II. Special meetings of the board of directors may be held at any time upon the call of the president or
as provided in the by-laws.
a. Only I is true
b. Only II is true
c. Both are true
d. Both are false
22. Portia transferred his shares to Soleil, by endorsing and delivering his certificate of stock covering
the shares to Soleil. However, the transfer has not yet been registered in the books of the corporation.
Who is entitled to the dividends declared before registration?
a. Portia, the transferor
b. Soleil, the transferee
c. The Corporation
d. None of the above
23. Elijah subscribed to 700 shares of stock in a single subscription to a corporation but paid only for
400 shares, for which he was issued fully paid certificate for 400 shares. Is he entitled to vote the paid
up shares notwithstanding the fact that he has not paid the remaining 300 shares?
a. Yes, if agreed by the board of directors and stockholders
b. Yes, the 400 shares fully paid can be voted
c. No, it must be fully paid in order to vote
d. None of the above
24. The voting trust agreement filed with the corporation shall be subject to examination by any
stockholder of the corporation in the same manner as any other corporate book or record.
a. True
b. False
c. Neither A and B
25. A subscription entered into after the incorporation for the acquisition of unissued stock.
a. Pre-incorporation
b. Pro-incorporation
c. Post-incorporation
d. Past-incorporation
26 I. The Articles of Incorporation is amended by a majority of the board of directors or trustees and
stockholders representing 2/3 of the outstanding capital stock, or 2/3 of the members in case of
non-stock corporations.
II. The power to amend or repeal the articles of incorporation may be delegated by the 2/3 of the outstanding
stock or 2/3 of the members in the case of Non-stock Corporation.
Which statement is true?
a. Both are false
b. Both are true
c. Only I is true
d. Only II is true
27. Jayme is a stockholder, on the date of the said meeting he was accidentally slip and fell down on the
floor which causes some injury. He cannot attend the meeting because of the accident. He now
appoint Clark his close friend to be his proxy on the said meeting.
a. Clark have the right to vote since he was appointed as proxy.
b. Clark have no right to vote since there’s no written notice.
c. Clark may still vote but only half of Blank's voting share.
d. None of the above.
28. Under the by-laws of a corporation X, it was not stated who shall preside at meeting. Which is true?
a. Any board of directors/trustees shall preside at all meeting.
b. Any stockholders/members shall preside at all meeting.
c. Only one board of director have authority at all meeting.
d. The president have the authority at all meeting.
29. Aira, Blaire, Claire, Dale and Emy are all duly elected members of the BOD of 123 Drink Corp.
Felicity is the general manager entered into a supply contract with an European firm. The contract
was approved by the BOD. However, with the knowledge and consent of Felicity, no deliveries
were made at that time. As a result of the non-delivery of the promised supplies, the European firm would
like to file a suit for damages.
I. Felicity, the general manager, personally because the non-delivery was with her knowledge and consent
II. The members of the BOD individually because the approved the transaction
III. the BOD and the corporate officers can be held liable in behalf of the Corporation
Which statements that the European firm can be sue?

a. I
b. II and III
c. I and III
d. I, II and III
30. Who shall offer to pay the full amount of the balance on the subscription together with accrued
interests,costs of advertisement and expenses of sale for the smallest number of shared or fraction of a share?
a.Highest Bidder
b.Bidder of Subscription, Interest and Shares
c.Bidder of Property and Shares
d. None of the above
31. The statements below are the limitations on the right of inspection,except ONE.
I.The right must be exercised during reasonable hours on business days;
II. The person demanding the right has not improperly used information obtained through any
previous examination of the books records of the corporation and
III.The demand is made in bad faith or for a illegitimate purpose.
a. I and II are true
b .II and III are true
c. Only II is false
d. Only III is false
32. Euleve, the presiding officer from JECK CO., called a meeting of directors occurring on March 21, 2019.
The notice was given on March 19, 2019. Stated in the by-laws is the time and place of the meeting which
will be held at Hanoi, Vietnam, GMT 9:00 a.m. Is this valid?
a. Invalid, because meetings should be held in the city or municipality where the principal office is located.
b. Invalid, because it will violate the requirement of being a citizen of the Philippines.
c. Valid, because the Board of Directors' meeting can be held outside the Philippines.
d. Valid, because Hanoi, Vietnam is a proper place to hold a meeting
33. The following are considerations of issuance of stock except:
a. Actual cash paid to the corporation
b. Previously incurred indebtedness by the corporation
c. Outstanding shares exchanged for stocks in the event of reclassification
d. Labor to be performed or to be rendered to the corporation
34.35Junafhe subscribed from JECK Co. 20 shares of stock with a par value of Php 100 per share paying
Php 500.00. Afterwards, she was declared in default for nonpayment of her balance and the stocks
were offered in a public auction to the highest bidder. The cost of sale and interest accruing
amounted to Php 200.00. In the auction, Candace, Kyla and Carly bidder for the unpaid balance
with corresponding shares:
Candace for 5 shares bidded Php 1400
Kyla for 5 shares bidded Php 1500
Camly for 5 shares bidded Php 1600
Who is the highest bidder?
a. Candace
b. Kyla
c. Camly
d. None
35.The distinction between proxy and voting trust agreement is that in a voting trust agreement.
a. The agreement need not notarized.
b. Trustee acquires legal title to the shares of the transferring stockholders.
c. A trustee cannot vote when the stockholder is present.
d. All of the above.
36.Which of the following statement is true concerning about voting trust for treasury shares.
a. It has no voting right.
b. As a rule, it may vote as owner or agent.
c. They are entitled into dividends.
d. Both A and C
37.The following are the effects of merger and consolidation except:
a. The separate existence of the constituent corporations shall cease, except the surviving and
consolidated corporation.
b. The surviving or consolidated corporation shall not be liable for all the liabilities of each of the
constituent corporation.
c. The constituent corporation becomes a single corporation.
d. The surviving corporation shall possess all rights, privileges, and powers, subject to all duties and
responsibilities of a corporation under the Code.
38. In what case is the appraisal right given to a dissenting stockholder?
a. In case of merger or consolidation of corporation
b. Investment of corporate funds in another corporation.
c. In the case of lease, sale, exchange, transfer mortgage and other disposition of assets.
d. All of the above.
e. None of the above.
39. Which of the following is prohibited from engaging in a close corporation?
a. Insurance companies
b. Mining corporations
c. Food corporation
d. All of the following except letter c.
40. I. The names of the corporations proposing to merge or consolidate, hereinafter referred to as the
constituent corporations
II.Such other provisions with respect to the proposed merger or consolidation as are deemed
unnecessary or undesirable.
a.)Only statement I is true.
b.) Only statement II is true.
c.) Both statements are true
d.) Both statement are false.
41. Within ten (10) days after demanding payment for his shares, a dissenting stockholder shall submit the
certificates of stock representing his shares to the corporation for notation thereon that such shares are
dissenting shares. Failure to do so shall:

a.) Such notation are transferred, and the certificates consequently cancelled
b.) Assessed against the corporation, unless the refusal of the stockholder to receive payment was
unjustified.
c.) At the option of the corporation, terminate his rights under this Title.
d.) None of the above.
42. Which of the following statements is incorrect:
a.) All the corporation's issued stock of all classes, exclusive of treasury shares, shall be held of record
by not more than a specified number of persons, not exceeding twenty (20)
b.) all the issued stock of all classes shall be subject to one or more specified restrictions on transfer
permitted by this Title XII.
c.) all the issued stock of all classes shall be subject to only one specified restrictions on transfer
permitted by Title XII.
d.) None of the above.
43.Members of a non-stock corporation may vote in the following, EXCEPT.
a. by proxy, provided in the articles of incorporation
b. in person, not provided in the articles of incorporation
c. by mail, if authorized by the by-laws with the approval of SEC
d. by an executor or administrator, not provided in the by-laws
44. Which of the following statements is true about a non-stock corporation?
a. Profit are distributed to the stockholders through dividends
b. Cumulative voting is always available in the election of trustees
c. Trustees may exceed 15 in number
d. The term of a trustee is 1 year
45. Statement 1: Any profit in a non-stock coporation may obtain as an incident to its operation shall,
whenever necessary be distributed to its members, trustees or officers.
Statement 2: Termination of membership in a non-stock corporation shall have the effect of
extinguishing all rights of a member in the corporation or in its property.
a. Only statement 1 is true
b. Only statement 2 is true
c. Both statements are true
d. Both statements are false
46. I.) If the Commission is satisfied that the merger or consolidation of the corporations concerned is not
inconsistent with the provisions of this Code and existing laws, it shall issue a certificate of
merger or of consolidation, at which time the merger or consolidation shall be
effective.
II.) If, upon investigation, the Securities and Exchange Commission has reason to believe that the proposed
merger or consolidation is contrary to or inconsistent with the provisions of this Code or existing laws, it
shall set a hearing to give the corporations concerned the opportunity to be heard and a mere notice of the
date, time and place of hearing shall be given to each constituent corporation at least two (2) weeks before
said hearing.
The foregoing statements:
a.) Only statement I is true.
b.) Only statement II is true.
c.) Both statements are true.
d.) Both statements are false.
47. These statements concerning a close corporation is presented to you:
I. In case of deadlock in management, the SEC may order the corporation to acquire its own shares of stock
provided it has unrestricted retained earnings.
II. A close corporation shall not list in any stock exchange or make any public offering of any of its stocks
of any class.
a. Both statements are true.
b. Both statements are false.
c. Only statement I is true.
d. Only statement II is true.
48. All statements regarding Non-stock Corporation are true except:
a. A member is not authorized to vote by proxy unless otherwise provided in the articles of incorporation or
the by-laws.
b. Its income is used for the furtherance of the purpose or purposes for which the corporation was organized.
c. Termination of membership shall have the effect of extinguishing all rights of a member unless otherwise
provided in the articles of incorporation.
d. Officers may be directly elected by the members.
49.Statement 1: In seeking approval for plan of merger or consolidation the notice of meetings shall be
given to all stockholders or members of the respective corporations at least two weeks prior to the
date of the meeting, either personally or by registered mail.
Statement 2: In the articles of merger or consolidation one must only include the number of shares or
members voting for in each corporation.
a. Statement 1 TRUE, Statement 2 FALSE
b. Statement 1 FALSE, Statement 2 TRUE
c. Both are TRUE
d. Both are FALSE
50. The following are Eleemosynary purpose of a non- stock corporation, except.
a. Professional
b. Educational
c. Profit
d. Scientific
51. Which of the following statement is False in regards to Non- Stock Corporation?
A. Any profit that a non- stock corporation may obtain will be used for the furtherance of the
purpose or purposes for which the corporation was organized.
B. All Liabilities and obligations of the corporation shall be paid first.
C. Officers of a non-stock corporation may be directly elected by the members.
D. A person can be elected as trustee even though he is not a member of the corporation.
52. The following are the characteristics of a non-stock corporation, except:
a. One-third (1/3) of its income during its existence can be distributable as dividends to its members,
trustees, or officers
b. The membership is non-transferable.
c. It can't be converted into a stock corporation by mere amendment of its articles of corporation.
d. It is not allowed to distribute any of its assets.
53. I. The right of the members to vote may be limited, broadened or denied to the extent specified in the
articles of incorporation or the by-laws.
II. Unless otherwise provided in the articles of incorporation or the by-laws, a member may not vote
by proxy.
A. Only I is true.
B. Only II is true.
C. Both are true.
D. Both are false.
54. The proper custodian of the books, minutes and official records of a corporation is usually?
a. President
b. Exceutive Committee
c. Corporate Secretary
d. Treasurer
55. As a rule, a corporation that purchases the assets of another will not be liable for the debts of the selling
corporation, expect when any of the following circumstances is present, except:
a. Where the purchaser expressly or impliedly agrees to assume the debts.
b. Where the transaction amounts to a consolidation or merger of the corporation.
c. Where the purchasing corporation is merely a continuation of the selling corporation.
d. Where the transaction is entered into escape liability for debts.
56. Is one where no part of its income is distributable as dividends to its members, trustees, or officers.
a. Non-stock Corporation
b. Non-profit Corporation
c. Incorporation
d. Stock Corporation
57. I. No person shall be elected as trustees unless he is a member of the corporation.
II. Unless otherwise provided in the articles of incorporation or by-the laws, officers of a non-stock
corporation may be directly elected by the members.
a. Only I is true
b. Only II is true
c. Both are true
d. Both are false
58. The following are exceptions in dissenting stockholder who demands payment of his shares that is not
allowed to withdrew from his decision EXCEPT
a. The corporation does not consent to the withdrawal;
b. The proposed corporate action is disapproved by the SEC where its approval is necessary;
c. The proposed corporate action is abandoned or rescinded by the corporation;
d. The SEC determines that such stockholder is not entitled to appraisal right
59. Which of the following is false about close corporation?
a. Pre -emptive right extends to all stock issuance
b. A stockholder may withdraw and avail of his right of appraisal
c. Restrictions on transfer of shares can be invalidly imposed
d. Quorum may be greater than a mere majority.
60. I. Termination of membership shall have the effect of extinguishing all rights of a member in the
corporation or in its property, unless otherwise provided in the articles of incorporation or the by-
laws
II. Members’ meeting may be held at any place outside the principle office of the corporation
provided it shall be within the Philippines
a. Only I is true
b. Only II is true
c. Both are true
d. Both are false
61 When a foreign corporation withdraw its license in the Philippines they need to file the following to
SEC for the issuance of certificate of withdrawal. Which among the following requirement is
incorrect.
A. All taxes, imposts, assessments and penalties if any lawfully due to the Philippine Government or any
agencies or political subdivisions have been paid
B. All claims which have accrued in the Philippines have been paid, compromised or settled.
C. The petition for withdrawal of license has been published once a week for three consecutive weeks in a
newspaper of general circulation in the Philippines
D. Submission in the SEC an authenticated copy of the amendment of Articles of incorporation which stated
the withdrawal of the corporation in the Philippines
62. What doctrine states that a foreign corporation, even unlicensed ones, can sue or be sued on a
transaction or series of transaction set apart from their common business in the sense that there is
no intention to engage in a progressive pursuit of the purpose and object of business transaction?
a. Doctrine of Ubiquitous Transaction
b. Doctrine of Isolated Transaction
c. Doctrine of Corporation by estoppel
d. Doctrine of Piercing the Corporate Veil
63. Which of the following is the essential requisites of a foreign corporation under The Corporate Code:
I. The laws of the country where the corporation was organized allow the Filipino citizens and corporations
to do business in its own country or state.
II. It must be a corporation that is registered and existing under the laws of the Philippines.
III. It must be formed, organized, or existing under the laws other than those of the Philippines.
IV. It must be governed by special laws and by the general provisions of the special corporation.
a. Statement I only.
b. Statement I and III.
c. Statement II and III.
d. All of the above.
64. The following are the rights of a foreign corporation to bring suit in Philippine courts, except:
a. If the foreign corporation is transacting or doing business in the Philippines with a license, it has the right
to sue within the jurisdiction of the Philippines;
b. If a foreign corporation is not doing business in the Philippines, it needs no license to sue before Philippine
courts on an isolated transaction.
c. If a foreign corporation does business in the Philippines without a license, a Philippine citizen or entity
which has contracted with said corporation may be estopped from challenging the foreign corporation’s
corporate personality in a suit brought before Philippine courts
d. If a foreign corporation does business in the Philippines without the required license, it can sue before
Philippine courts on any transaction.
65. The following are the requirements of the certificate of withdrawal of foreign corporation, except:
a. All claims which have accrued in the Philippines have been paid, compromised or settled;
b. All taxes, imposts, assessments, and penalties, if any, lawfully due to the Philippine Government or any
of its agencies or political subdivisions have been paid; and
c. The petition for withdrawal of license has been published once a week for three (5) consecutive weeks in
the televised channel in the Philippines.
d. The petition for withdrawal of license has been published once a week for three (3) consecutive weeks in
a newspaper of general circulation in the Philippines.
66. The statements below constitute the composition of the board for a non-stock education
corporation except;
A. The board of trustees shall not be less than 5 nor more than 15
B. The board of trustees shall be in multiples or 5
C. The board of trustees can either be 5,10,or 15
D. The board of trustees can be more than 20 if stipulated in the certificate of incorporation
67. How many board of directors does a stock educational corporation have?
A. The board of directors shall be the same as a normal stock corporation, not less than 5 nor more than 15
B. The board of trustees shall be in multiples or 5
C. The board of directors should be 15
D. The board of directors can be more than 20 if stipulated in the certificate of incorporation
68. When will religious corporation be effective?
A. Before the verification of the articles of incorporation
B. After the submission of the articles of incorporation at the Securities and Exchange Commission
C. From and after the filing of the articles of with the Securities and Exchange Commission verified by
affidavit and accompanied by the required documents.
D. After the Chief archbishop, bishop, priest, minister, rabbi or presiding elder become a corporation sole.
69. Which of the following statements about Corporation sole is/are false?
I. Any corporation sole can't purchase and hold real estate and personal property for its church, charitable,
benevolent or educational purpose, and may receive bequests or gifts for such purpose.
II. Corporation sole may sell or mortgage a real property held by it by obtaining an order for that purpose
from the court.
a. Both I and II are false
b. Only I is false
c. Only II is false
70. The declaration of dissolution in a corporation sole shall set forth the following except:
a. The reason for dissolution and winding up
b. The name of the Corporation
c. the names and addresses of the persons who manages the corporation
d. The authorization for the dissolution of the corporation by the particular religious denomination, sect or
church
71. Which statements is false:
I. Outstanding capital stock includes all shares of stock issued by subscribers or stockholders of a stock-
corporation which are not fully paid.
II. To be considered outstanding, the share of stock must be held by persons other than the corporation itself.
a. Statement I only
c. Statements I and II
b. Statement II only
d. All of the above
72. This refers to the power of the State through the proper governmental agency to examine the business
affairs, administration and condition of corporations.
a. Visitor right
b. Visitorial Power
c. Power of the State
d. Both a and c
73. The following are methods of corporate liquidation except:
I. Liquidation by the directors’ themeselves
II. Liquidation by a duly appointed receiver
III. Liquidation by trustees to whom Board of Directors had conveyed the corporate assets.
a. I
b. II
c. III
d. None of the above
74. The following are effects of dissolution except:
a. The corporation continues as a body corporate for three (3) years for purposes of winding-up or liquidation
b. The corporation ceases as a body corporate to continue the business for which it was established
c. After the expiration of the three (3) years winding up period, the corporation ceases to exist for all purposes
and as a general rule, it can no longer sue and be sued as such
d. The corporation does not continue as a body corporate for three (3) years and as a general rule it can sue
and be sued as such
75. A corporation may be dissolved by the SEC upon filling of a verified complaint and after proper notice
and hearing on the grounds provided by the existing laws, rules and regulations."
a. Voluntary Dissolution
b. Involuntary Dissolution
c. Legislatiove Dissolution
d. Shortening of the term
76. When the assets of the corporation are not sufficient to pay all claims upon dissolution of a corporation,
who is entitled to be paid first? One refers to the primary priority?
a. Stockholder/members/directors/trustees or officers of the corporation who are also its creditors as a result
of a legislative or proper or claim
b. When the corporation is insolvent, the creditors of the corporation are entitled to have all its assets
distributed among them according to their rights and priorities.
c. To be distributed among the stockholders or members in proportion to their shareholdings or interest in
the absence of any provision to the contrary.
d. Upon winding-up of the corporate affairs, any asset distributable to any creditor or stockholder or member
who is unknown or cannot be found shall be escheated to the city or municipality where suych assets are
located.
77. After the dissolution, the corporation shall nevertheless continue as a body corporate for three (3) years
not for continuing the business for which it was established but for the following, except:
a. To prosecute and defend suits by or against it
b. To enable it to settle and dose its affairs
c. To dispose its property
d. To distribute its profits
78. In recommending to the Batasang Pambansa corporations, businesses, or industries to be declared
vested with a public interest and in formulating proposals for limitations on stock ownership, tha
National Economic and Development Authority shall consider the following, except:
a. the type and nature of the industry
b. the economies of scale
c. voting rights
d. the labor intensity of the activity
79. I. Only domestic corporations, lawfully doing business in the Philippines shall submit to the Securities
and Exchange Commission an annual report of its operations, and financial statements of its assets
and liabilities certified by any independent Certified Public Accountant.
II. The SEC shall have the power & authority to implement the provisions of the Corporation Code
for the prevention of fraud and abuses on the part of the controlling stockholders, members,
directors, trustees or officers.
a. Only I is true
b. Only II is true
c. Both are true
d. Both are false
80. I. In the case of any provision of the Corporation Code or any part of it thereof be declared invalid or
unconstitutional, the other provisions, separable and inseparable, shall also be invalid.
II. Violations of any of the provisions of the Corporation Code of its amendments not otherwise
specifically penalized therein shall be punished by a fine of not less than P1,000 but not more than
P15,000, or by imprisonment for not less than 30 days but not more than 3 years, or both, in the
discretion of the court.
a. Only I is true.
b. Only II is true.
c. Both are true.
d. Both are false.