A contract where two or more persons bind themselves to contribute money, property

or industry to a common fund with the intention of dividing the profits among
themselves.
A. Voluntary association
B. Corporation
C. Partnership
D. Sole proprietorship
ANSWER: C

One of the following is not a characteristic of contract of partnership.

A. Real, in that the partners must deliver their contributions in order for the
partnership contract to be perfected.
B. Principal, because it can stand by itself.
C. Preparatory, because it is a means by which other contracts will be entered
into.
D. Onerous, because the parties contribute money, property or industry to the
common fund.
ANSWER: A

One of the following is not a requisite of a contract of partnership. Which is it?

A. There must be a valid contract.
B. There must be a mutual contribution mutual contribution of money, property or
industry to a common fund.
C. It is established for the common benefit of the partners which is to obtain
profits and divide the same among themselves.
D. The articles are kept secret among the members.
ANSWER: D

The minimum capital in money or property except when immovable property or real
rights thereto are contributed, that will require the contract of partnership to be
in a public instrument and be registered with the Securities and Exchange
Commission (SEC).
A. P5,000.00
B. P10,000.00
C. P3,000.00
D. P30,000.00.
ANSWER: C

If the partnership has the minimum capital mentioned in No. 4, but the contract is
not in a public instrument or the same is not recorded with the SEC, the
partnership.
A. Is void.
B. Is voidable.
C. Does not acquire juridical personality.
D. Still acquires juridical personality.
ANSWER: D

One of the distinctions between a partnership and a corporation is that a

partnership:
A. May be formed by one person.
B. Is created by operation of law.
C. Acts through a board of directors.
D. May exist for an indefinite period.
ANSWER: D

Statement 1: A man and a woman living together as husband and wife without the
benefit of marriage may enter into a universal partnership | Statement2: All
partners including industrial ones shall be liable pro rata with all their separate
property after the partnership assets have been exhausted.
A. Only Statement 1 is incorrect
B. Only Statement 2 is incorrect
C. Statements 1 & 2 are incorrect
D. Neither statements are incorrect
ANSWER: A

Statement 1: In a universal partnership of all present property, the partners may

stipulate that future property shall belong to the partnership but the stipulation
cannot include property acquired by inheritance, legacy or donations. | Statement2:
The profits and losses of the partnership shall be divided equally among the
partners if they have no profit and loss sharing agreement.
A. Only Statement 1 is incorrect
B. Only Statement 2 is incorrect
C. Statements 1 & 2 are incorrect
D. Neither statements are incorrect
ANSWER: B

Statement 1: A partnership whose capital in money or property amounts to P3,000.00

or more does not acquire juridical personality if the contract is not recorded with
the Securities and Exchange Commission. | Statement2: Spouses can validly enter
into a particular partnership with each other.
A. Only Statement 1 is incorrect
B. Only Statement 2 is incorrect
C. Statements 1 & 2 are incorrect
D. Neither statements are incorrect
ANSWER: A

Three of the following partnership contracts are void. Which one is not?
A. A universal partnership of all present property between husband and wife.
B. A universal partnership of profits between a man and a woman living together as
husband and wife without the benefit of marriage.
C. A particular partnership between husband and wife.
D. A universal partnership of profits between a private individual and public
officer.
ANSWER: c

Bettina, Erlinda, Amanda, Ursula, Teresa and Yolanda are partners in BEAUTY
Enterprises, a dealer in cosmetics and other beasuty products, with contributions
of P60,000.00, P50,000.00, P40,000.00, P30,000.00, P20,000.00, and P10,000.00,
respectively. No one was appointed as manager in the articles of partnership.
A. Bettina is the manager because she made the biggest investment.
B. Every act in the ordinary course of the business will have to be decided by the
majority determined on per head basis.
C. Every act in the ordinary course of the business will have to be decided by the
controlling interest (biggest investment) although the partners owning them do not
constitute the majority.
D. All the partners are agents or managers of the partnership and any one of them
may perform acts of administration.
ANSWER: D

Vincent and James entered into a universal partnership of profits. At the time of
the execution if the articles of partnership, Vincent had a two-door apartment
which he inherited from his father 3 years earlier. James, on the other hand, had a
fleet of taxis which he purchased 2 years before. In the first year of the
partnership, Vincent earned P500,000.00 as a radio talent, while James won
P1,000,000.00 in the lotto. During the same period, rentals of P120,000.00 were
collected from the apartment, while fare revenues of P200,000.00 were realized from
the operation of the fleet of taxis. Which of the following belongs to the
partnership?
A. Two-door apartment.
B. Lotto winnings of P1,000,000.00.
C. Salary of P500,000.00
D. Fleet of taxis.
ANSWER: c

John, Albert and Wilfred are partners in JAW Enterprises. Not having established
yet their credit standing, the three partners requested Simon, a well-known
businessman, to help them negotiate a loan from Carlos, a money lender. With the
consent of John, Albert and Wilfred, Simon represented himself as a partner of JAW
Enterprises. Thereafter, Carlos granted a loan of P150,000.00 to JAW Enterprises.
What kind of partner is Simon?
A. Managing partner.
B. Liquidating partner.
C. Ostensible partner.
D. Partner by estoppel.
ANSWER: D

Gregory, Edmond and Mark are partners in GEM Company with contributions of
P10,000.00, P40,000.00 and P50,000.00, respectively. Their agreement shows that
they will share in the profits in the ratio of 2:3:4. During the year, the
partnership sustained a loss of P9,000.00. How shall this loss be divided among the
partners?
A. Equally at P3,000.00 each.
B. Gregory, P900,00; Edmond, P3,600.00; and Mark, P4,500.00.
C. Gregory, P2,000.00; Edmond, P3,000.00; and Mark, P4,000.00.
D. The partners must establish first a loss sharing agreement before the loss may
be divided because they failed to have an agreement on the division of loss.
ANSWER: C

SAFA Law Office, a partnership engaged in the practice of legal profession, entered
into a contract of lease with the Philippine National Bank (PNB). After two months,
SAFA Law Office discontinued paying the accrued rent due to PNB. PNB then filed an
action for specific performance for the collection of sum of money in the amount
equal to the unpaid rentals with damages. Appearing in behalf of SAFA Law Office,
Managing Partner Saludo refused to invoke SAFA Law Office as an indispensable party
to the case. Which of the following statement is correct?
A. SAFA is neither a legal entity nor a party litigant; it is only a relationship
or association of lawyers in the practice of law. Therefore, it does not have a
personality to appear in court.
B. SAFA Law can only be considered a single proprietorship which may only be sued
through its owner or proprietor Saludo. Therefore, it is enough that Saludo appears
in behalf of SAFA Law Office.
C. Since SAFA Law Office is a partnership, it acquired a juridical personality by
operation of law. Hence, it has a legal personality to appear in court.
D. None of the above statements are correct.
ANSWER: C

Joseph and Edward entered into a universal partnership of all present property. At
the time of their agreement, Joseph had a four-door apartment which he inherited
from his father 3 years earlier. Edward, on the other hand, had a fishpond which he
acquired by dacionenpagofrom Robert. During the first year of the partnership,
rentals collected on the four-door apartment amounted to P480,000.00; while fish
harvested from the fishpond were sold for P300,000.00. During the same period,
Edward received the day of donation a vacant lot from an uncle. The partners had a
stipulation that future property shall belong to the partnership. Which of the
following does not belong to the common fund of the partnership?
A. Fishpond.
B. Rental of P480,000.00.
C. Apartment.
D. Vacant land.
ANSWER: D

D, to carry on a business, borrowed money from C. It was agreed that D would return
the money in installments and that said installments would come from D’s profits in
the business. Is a partnership created between D and C?
A. Yes, since C has a share in the profits of the business.
B. No, since C is considered a creditor lending money to the business
C. Yes, if D cannot pay the said loan
D. No, for C to be considered a partner, the payment must not be made in
installments
ANSWER: D

Pesayco, a partner in an oral partnership for the catching of fish, with cash as
the only contributions thereto, refused to account for the proceeds of the firm on
the ground that the agreement was not in writing. Is he correct?
A. No, because the oral partnership is valid, real properties not having been
contributed
B. Yes, since the partnership was orally made and is therefore void and inexistent
from the very beginning
C. No, because the partnership must be made in a private instrument
D. Yes, since the partnership must be made in a public instrument
ANSWER: A

A and B entered into a universal partnership of profits. Subsequently, A won 1st

prize in the sweepstakes. Will the money belong to the partnership?
A. Yes, because it was acquired by A’s industry or work
B. No, because it was not acquired by industry or work
C. Yes, since in a universal partnership of profits, it doesn’t matter if it was
acquired by A’s industry or work all subsequently acquired cash or property belong
to the partnership by default
D. No, even if A willingly contributes it to the partnership
ANSWER: B

Rosalinda Margarita owns an apartment in Matnog,Sorsogon. On November 11, 2011,

Rosalinda died, leaving her apartment to her twin daughters,Jerelyn and Jirilin,
both of minor ages, where it was stated in her last will and testament thatsuch
property will be shared by them. Is a partnership formed between Jerelyn and
Jirilin?
A. No, it only belongs to one of them since it is indivisible.
B. Yes, since all the essential elements of partnership are present.
C. No, because only a co-ownership is formed between them.
D. Yes until the property is divided between them.
ANSWER: C