CPA REVIEW SCHOOL OF THE PHILIPPINES

REGULATORY FRAMEWORK FOR BUSINESS TRANSACTIONS

QUIZZER
Direction: Read and select the best answer for the following questions.

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 incident to its existence.
a. Partnership
b. Corporation
c. Cooperative
d. Sole Proprietorship

2. It is autonomous and duly registered association of persons, with a common bond of

interest, who have voluntarily joined together to achieve their social, economic, and
cultural needs and aspirations by making equitable contributions to the capital required,
patronizing their products and services and accepting a fair share of the risks and benefits
of the undertaking in accordance with universally accepted cooperative principles.
a. Partnership
b. Corporation
c. Cooperative
d. Sole- proprietorship

3. Which of the following is the purpose of a cooperative?

a. To encourage thrift and savings mobilization among the members
b. To maximize the control of wealthy people of business
c. To acquire land for development as condominium projects for commercial
purposes
d. To advocate strike, rally and boycott

4. Which of the following is not a purpose of a cooperative?

a. To promote and advance the economic, social and educational status of the
members
b. To encourage and promote self-help or self-employment as an engine for
economic growth and poverty alleviation
c. To generate funds and extend credit to the members for productive and provident
purposes;
d. To create monopoly or business considered as restraint of trade
5. Which of the following is an objective of a cooperative?
a. To provide goods and services to its members to enable them to attain increased
income, savings, investments, productivity, and purchasing power, and promote
among themselves equitable distribution of net surplus
b. To teach members of inefficient ways of doing things in a cooperative manner
c. To allow the higher and more privileged groups to increase their ownership in the
wealth of the nation
d. To provide minimal social and economic benefits to its members

6. As a general rule, what is the quorum in the regular or special meeting of general
assembly of a cooperative bank?
a. At least one half plus one of the number of voting shares of all the members in
good standing
b. At least 25% of all members entitled to vote
c. At least 5% of all members entitled to vote
d. At least 3/4 of all members with voting rights present and constituting a quorum

7. As an exception to general rule, what is the quorum in the meeting of general assembly of
a cooperative bank for the amendment of its articles of cooperation or by-laws?
a. At least one half plus one of the number of voting shares of all the members in
good standing
b. At least 25% of all members entitled to vote
c. At least 5% of all members entitled to vote
d. At least 3/4 of all members with voting rights present and constituting a quorum

8. What is the voting rights of the members of a cooperative bank?

a. Each individual member shall have only one vote.
b. The voting rights of the members shall be proportionate to the number of their
paid-up shares.
c. Each individual member shall have one (1) basic vote and as many incentive
votes as provided for in the bylaws but not exceed five (5) votes.
d. Each individual member shall have five (5) basic votes.

9. What is the quorum necessary for validity of meeting of Board of Directors of ordinary
cooperative?
a. At least majority of the members of the Board unless the bylaws provide
otherwise
b. One-half plus one of all the members of the board of directors
c. At least 3/4 of the members of the Board unless the bylaws provide otherwise
d. At least 2/3 of the members of the Board unless the bylaws provide otherwise
10. What is the quorum necessary for validity of meeting of Board of Directors of
cooperative bank?
a. At least majority of the members of the Board unless the bylaws provide
otherwise
b. One-half plus one of all the members of the board of directors
c. At least 3/4 of the members of the Board unless the bylaws provide otherwise
d. At least 2/3 of the members of the Board unless the bylaws provide otherwise

11. What is the required vote for division of cooperative to two or more cooperatives?
a. At least 3/4 of all the members with voting rights, present and constituting a
quorum
b. At least 1/3 of all the members with voting rights, present and constituting a
quorum
c. At least 2/3 of all the members with voting rights, present and constituting a
quorum
d. At least majority of all the members with voting rights, present and constituting a
quorum

12. What is the required vote for the termination of a membership in a cooperative for any of
the valid causes enumerated by Cooperative Code?
a. At least 2/3 of all the members of the cooperative with right to vote
b. At least 3/4 of all the members of the cooperative with right to vote
c. At least 3/4 of all the members of the board of directors of the cooperative
d. At least majority of all the members of the board of directors of the cooperative

13. Which predicate crime of money laundering still require court order by Court of Appeals
before AMLC may examine the bank accounts of the accused?
a. Kidnapping for ransom
b. Drug trafficking
c. Hijacking
d. Jueteng and Masiao

14. Which of the following is not a requisite of a negotiable promissory note?

a. The promissory note must be in writing and signed by the maker.
b. The promissory note must be payable on demand, or at a fixed time or at a
determinable future time.
c. The payee of a promissory note payable to order must be named or otherwise
indicated therein with reasonable certainty.
d. The promissory note must be payable to a specified person named therein.
15. Which of the following instruments is non-negotiable?
a. A bill of exchange written with the use of pencil.
b. A bill of exchange written on a wall.
c. A promissory note written on a piece of paper.
d. A promissory note signed with a mark.

16. Which of the following instruments is an invalid instrument?

a. "Pay P or order P1, 000 out of my share from profits of ABC, LTD." Signed. M
b. "Pay P or order P2,000 in two equal installments plus 10% interest per annum."
Signed. M.
c. "Pay P or order P3,000 one month before X's demise." Signed. M.
d. None of the above.

17. Which of the following instruments is not unconditional and is, therefore, non-
negotiable?
a. "Pay P or order P1,000 and reimburse yourself with the proceeds of the watch you
are selling to me."
b. "Pay bearer P4,000 from my share in the profits of our partnership business."
c. "l promise to pay P or order P3,000 as payment for the ring I purchased from
him."
d. "Pay bearer P2,000 and charge the payment to my account in your hands."

18. M made and delivered a negotiable promissory note payable to P or order and authorized
P to flll up the amount of no more than P20,000. P filled up the amount of P35,000. P
subsequently indorsed and delivered the note to A who subsequently indorsed and
delivered the note to B, a holder in due course. Who may be held liable to B for P
35,000?
a. P only
b. A only
c. P and A only
d. M, P and A

19. X stole a pre-signed blank negotiable promissory note payable to order from M's office
cabinet. X then placed the amount of P15,000 and P's name as the payee, then indorsed
and delivered the note to A using P's name by forging the latter's signature. A then
subsequently indorsed and delivered the note to B who subsequently indorsed and
delivered the note to C, a holder in due course. Who is liable to C in the amount of P
15,000?
a. M, P, C, A and B
b. P, X, A and B only
c. X, A and B only
d. M, P and X only
20. X stole a negotiable promissory note payable to the order of X that is completely made by
M. X subsequently indorsed and delivered the note to A who subsequently indorsed and
delivered the not to B, a holder in due course. Who may be held liable by B?
a. A only
b. X only
c. X and A only
d. M, X and A

21. 21. M made a negotiable promissory note payable to the order of P for P5,000. P indorsed
and delivered the note to A. X stole the note from A and then forged A's signature in
order to indorse the note to B and the delivered the note to B. B subsequently indorsed
and delivered the note to C, a holder in due course. Who may be held liable by C?
a. M, P, X, A and B
b. P, X, A and B only
c. X, A and B only
d. X and B only

22. M executed a negotiable promissory note in the sum of P 100,000 to the order of P for the
purchase of jewelry which P does not own or possess. P indorsed and delivered the note
to A, a holder in due course. From whom may A collect P100,000?
a. From both M and P
b. From M only
c. From P only
d. None of the above

23. M wanted to held his friend P who needed cash desperately. In exchange for P's valuable
painting and to accommodate P, M executed a negotiable promissory note for P400,000
naming P as the payee therein. Subsequently, P indorsed and delivered the note at BDO
Bank and received the proceeds out of the discounted note. Upon maturity date, P and
BDO Bank decided to extend the maturity date by another six months without knowledge
and consent of M. The grace period also matured without the note being paid. Which is
correct?
a. M is primarily liable to BDO Bank whereas P is only secondarily liable to BDO
Bank.
b. Only P is liable to BDO Bank because M is released from his obligation when the
period was extended without his knowledge and consent.
c. Only M is liable to BDO Bank as an accommodation party to the note.
d. None of the above.
24. M made a negotiable promissory note payable to the order of P. X stole the note and
forged P's signature to indorse the note to A and delivered the note to A. A subsequently
indorsed and delivered the note to B as follows "Pay to B without recourse, (Sgd. A)."
Who among the parties shall be liable to B?
a. X, M and P
b. X and A only
c. X and M only
d. X only

25. M made a negotiable promissory note for P5,000 payable to the order of P. P indorsed
and delivered the note to A as follows: "Pay A upon the passing of A of the Bar
Examination next year." A flunked the bar examination held in the following year and the
note matured. Which is correct?
a. M may or may not pay A the sum of P5,000 and in case he does, he discharged
from his obligation on the note.
b. M should not pay A the sum of P5,000 because the condition is not fulfilled.
c. M and P should not pay A the sum of P5,000 because the promise is not
unconditional and therefore, the instrument is non-negotiable.
d. None of the above.

26. M made a negotiable promissory note payable to P or bearer. P specially indorsed and
delivered the note to A who specially indorsed and delivered the note to B. X stole the
note from B and delivered it to C without any indorsement. C is a holder in due course.
Who may be held liable to C?
a. X only
b. M and X only
c. M, P, A and X only
d. M, P, A, B and X only

27. Which of the following is not a requisite of a holder in due course?

a. He took the instrument complete and regular upon its face.
b. He became the holder of the instrument before it is overdue and without notice
that it had been previously dishonored if such was the fact.
c. He took the instrument in good faith and for value.
d. He has no knowledge of any fact which would impair the validity of the
instrument or render it valueless.
28. In which of the following cases is the holder deemed to be a holder in due course?
a. The holder acquired the instrument through the indorsement of one of the two
payees.
b. The holder acquired the instrument at noontime on its maturity date.
c. The holder accepted the instrument from the payee under a strong and reliable
warning of the latter's swindling activities.
d. None of the above

29. Which of the following is a real defense that may be set up against any type of holder?
a. Want of authority of agent.
b. Want of delivery of complete instrument.
c. Absence or failure of consideration.
d. Acquisition of instrument by force, duress, fear or by unlawful means.

30. Which of the following is a characteristic of fraud in factum or fraud in esse contractus?
a. It is fraud in the execution of the instrument.
b. The person actually knows that what he signed is a negotiable instrument but he
was induced to do so because of insidious words or fraudulent machinations.
c. It is a personal defense that cannot be set up against a holder in due course.
d. None of the above

31. M made a negotiable promissory note payable to P or order as payment for the purchase
of what appears to be a genuine diamond ring but it was in fact a mere piece or valueless
glass. P specially indorsed and the note to A who subsequently indorsed and delivered the
to B. B specially indorsed and delivered the note to C who subsequently indorsed and
delivered the note to D. A, B and D knew the fraud committed by P. C, however, has no
knowledge thereto. May D collect from?
a. No because fraud in inducement is a real defense.
b. No because M has a personal defense that he can avail against D who is an
immediate party to him.
c. Yes, because D is deemed a holder in due course since he derives his title from a
holder in due course and there D is not subject to personal defense of fraud in
inducement.
d. None of the above

32. Which of the following parties is secondarily liable to a negotiable instrument?

a. Maker of a promissory note.
b. Drawee of a bill of exchange.
c. Acceptor of a bill of exchange.
d. Drawer of a bill of exchange.
33. In which of the following cases must presentment for payment be made?
a. To the drawer, where he made a stop payment order to the drawee-bank.
b. To the drawer, where he withdrew all his deposit in the drawee-bank.
c. To the indorser, where the instrument was made or accepted for his
accommodation.
d. None of the above.

34. Who shall be given notice of dishonor?

a. Maker and acceptor
b. Qualified indorser and person negotiating the instrument by mere delivery
c. Payee-general indorser and drawer
d. None the above

35. M made a negotiable promissory note payable to the order of P. Indorsement were as
follows: P to A, A to B, B to C, and C to D. The notice was dishonored by M. D served a
notice of dishonor to C. However, P, A and B did not receive any notice of dishonor. C
paid the note to D. Who among the secondary parties does C have a right of recourse?
a. P, A and B are already liable to C.
b. Only A and B already liable to C.
c. Only B is liable to C.
d. None of the above.

36. Which of the following constitutes material alteration?

a. Changing the sum payable written in figures without changing the sum payable
written in words
b. Insertion of legal rate of interest where payment of interest is stipulated but
without specifying the rate
c. Placing the name of the indorsee above the indorser's signature to convert a blank
indorsement into a special indorsement
d. None of the above

37. M made a negotiable promissory note for P 100,000 payable to P or order. P altered the
amount by increasing it to P150,000. P then indorsed and delivered the note to A who
subsequently indorsed and delivered the note to B, a holder in due course. Which is
correct?
a. M, P and A are not liable because material alteration is a real defense.
b. M is liable to B for P100,000, the original amount, while P and A are liable to B
for the new amount of P150,000 or P50,000 in case M pays the P100,000.
c. M is not liable to B while P and A are liable to B for the original amount of
P100,000.
d. M, P and A are liable to B the new amount 01" P 150,000.
38. Which of the following bills of exchange may not be treated optionally as promissory
note by the holder?
a. The drawer and drawee are the same person.
b. The drawee is a fictitious person.
c. The payee is a fictitious person.
d. The drawee is incapacitated person.

39. Presentment for acceptance, coupled with presentment for payment, is necessary to
charge secondary parties in
a. Bills payable after sight
b. Bills payable on demand
c. Bills payable at a fixed date
d. Bills payable at a fixed period after date

40. Which of the following statements relative to protest is false?

a. It is normally prepared and certified by a notary public.
b. It requires at least one witness.
c. It is normally required in case of foreign bills but not generally in inland bills.
d. It may be dispensed with in the same manner as a notice of dishonor may be
dispensed with.

41. Which of the following is a characteristic of a bill in set?

a. It consists of several parts being numbered without any reference to other parts.
b. A bill in set containing three parts shall be considered as three distinct bills.
c. The drawee is bound to accept all the parts of a bill in set.
d. None of the above.

42. R drew a check for P80,000 payable to the order of P against BDO Bank, the drawee-
bank. P indorsed and delivered the check to A who did present the check for payment
within six months. BDO Bank went bankrupt and R was able to recover only P500,000
out of his deposit of P2,000,000 from PDIC. What is extent of liability of the secondary
party to the check?
a. P20,000 from R and P0 from P.
b. P80,000 from either R or P.
c. P20,000 from either R or P.
d. P0 from both R and P.

43. Which of the following is covered by the term "Intellectual Property Rights" under
Intellectual Property Code of the Philippines?
a. Lay-out Designs (Topographies) of Integrated Circuits
b. Protection of Undisclosed Information.
c. Both A and B
d. Neither A nor B
44. Which of the following inventions will be afforded patent protection under Intellectual
Property Code of the Philippines?
a. A therapeutic machine that heals and eliminates scars and blemishes on any part
of the skin.
b. Computer program
c. Mere combination of different strains of bacteria
d. Procedures for computing net profit from business ventures

45. Two marks for the same product (candy) are currently being examined by the Trademark
Examiner of the Bureau of Trademarks to determine if they are confusingly similar. One
product bears the trademark "Axis Candy" while the other product uses the trademark
"Yummy Axis Candy." What test shall be applied to determine if there is trademark
infringement?
a. Dominancy test
b. Holistic test
c. Enabling test
d. Best mode test

46. The marks for the same product (soy sauce) are being examined by the Trademark
Examiner to determine if they are confusingly similar. The names of the manufactures are
apparently different as printed on the bottom part of their labels. However, the label
designs, colors, print styles and sizes are very similar and almost identical. What test
shall be applied to determine if there is trademark infringement?
a. Dominancy test
b. Holistic test
c. Enabling test
d. Best mode test
47. Which of the following is covered by the term "Author" of original work as applied to
copyright law under Intellectual Property Code of the Philippines?
a. Sculptor
b. Choreographer
c. Both A and B
d. Neither A nor B

48. Which of the following exclusive or economic rights has been granted by "Trade-Related
Aspects of Intellectual Property Rights (TRIPS) Agreement of WTO to author of original
work?
a. Right of rental
b. Right of reproduction
c. Right of performance
d. Right of transmission
49. Which of the following are considered moral rights of author of original work under
Intellectual Property Code of the Philippines?
a. To have authorship of his work attributed to him
b. To make alterations of his work
c. Both A and B
d. Neither A nor B

50. Which of the following works are considered as literary and artistic works that are
protected by copyright from the moment of creation?
a. White pages of telephone directory
b. The lines "Just do it'
c. Stories about Robin Hood
d. Pantomime

51. Which of the following are considered derivative works that are entitled to copyright
protection?
a. Dramatization
b. Translation
c. Both A and B
d. Neither A nor B

52. Which of the following matters are accorded copyright protection?

a. Photographs taken by a reporter of a sexy movie star
b. Illustrations of playing of board game
c. News about assassination of senator
d. Civil Code of the Philippines

53. Which of the following shall be given copyright protection?

a. Maze in "PACMAN" video game
b. Flying position of "Superman"
c. Evil black-robbed knight in "Star Wars'
d. None of the above

54. Which of the following acts constitutes copyright infringement?

a. Private performance of the work
b. Inclusion of work by way of illustration for teaching purposes
c. Both A and d
d. Neither A nor B
55. Which member of the BSP Monetary Board must he confirmed by the Commission on
Appointments?
a. Governor of BSP
b. Member from Cabinet
c. Members from Private Sector
d. All of the above

56. Which of the following of Monetary Board coming from private sector is qualified to be
a member of the BSP Monetary Board without need to resign or divest himself of his
position and interest?
a. Director of BDO Unibank
b. Area Manager of Palawan Pawnship
c. President of AFP Building and Loan Association
d. None of the above

57. Which of the following is a feature of conservatorship?

a. The conservator takes over the management of the bank whenever the bank fails
or is unwilling to maintain its liquidity.
b. The conservatorship may exceed one (1) year.
c. Conservatorship shall always precede receivership.
d. The conservator must be an official of the BSP.

58. Which of the following is not a justifiable ground for placing a bank under the
receivership by The PDIC summarily and without need of prior hearing?
a. Inability to meet the withdrawals of depositors during a period of financial panic
in the community.
b. Insufficient realizable assets to meet its liabilities.
c. Inability to continue without probable losses to its depositors and creditors
d. Willful violation of cease and desist order involving fraudulent acts.

59. Which of the following statements relative to a bank conservator and bank receiver is
false?
a. Both take charge of the assets and liabilities of the subject bank.
b. Both have the power to rehabilitate or liquidate the corporate life of the subject
bank.
c. Both need not be officers/employees of the BSP.
d. None of the above.
60. Which is true regarding the replacement of notes and coins issued by BSP?
a. Notes and coins may be called in for replacement by BSP when they are more
than 5 years old and 10 years old, respectively.
b. Notes and coins which are called in for replacement cease to be legal tender upon
the date of call,
c. Notes and coins become one year from the date of call.
d. Notes and coins that have been called in for replacement and have ceased to be
legal tender may still be exchanged at par value for a period of one year or for a
longer period as may be prescribed by the Monetary Board.

61. Which of the following constitutes payment in legal tender in accordance with the New
Central Bank Act?
a. Manager's check duly signed by the bank manager and already debited against the
drawer's account, with the creditor's name written as the payee thereof.
b. P200.00 payment consisting of the following: P1.00 coins totaling P80.00; and
P0.25 & P0.10 coins totaling P120.00.
c. Notes offered for payment to a creditor on July 1,200B, already called in for
replacement by the BSP on July 1, 200A.
d. None of the above.

62. Which of the following assets shall be included in the international reserves of the BSP?
a. Foreign notes and coins
b. Demand and time deposits in commercial banks abroad.
c. Both A and B
d. Neither A nor B

63. Which of the following is included in the term "Deposit Substitutes" under the New
Central Bank Act?
a. Promissory note
b. Banker's acceptance
c. Both A and B
d. Neither A nor B

64. Which of the following is under the supervision and regulatory powers of BSP?
a. Finance companies
b. Pawnshops
c. Buildings and loan associations
d. Homeowner's association
65. Which of the following statements about banks is false?
a. Banks must be stock corporations with par value shares
b. Banks obtain its funds from the public, which shall mean twenty or more persons.
c. Bank directors and officers cam borrow money or act as guarantors in their banks
of approved in writing by the majority of all the directors and the BSP is
furnished with a copy thereof.
d. The board of directors of banks must consist of at least one independent director
who is not connected with such bank or its affiliates.

66. What is the minimum number of independent directors in the board or directors of a
bank?
a. At least two independent directors
b. At least three independent directors
c. At least four independent directors
d. At least five independent directors

67. Which is not a characteristic of a bank?

a. Its board of directors may conduct meetings through video-conferencing
b. The Monetary Board, after due notice, has the power to disqualify, suspend or
remove any bank director or officer found unfit for his position.
c. It can only issue par value shares of stocks.
d. It must dispose its treasury shares within one year from their acquisition.

68. How many days must the treasury shares of a bank be disposed from their acquisition?
a. Within six months from their acquisition.
b. Within two months from their acquisition.
c. Within three months from their acquisition.
d. Within five months from their acquisition

69. Which of the following may be legally done by a bank?

a. Engage insurance business.
b. Enter into contracts of deposit on its safety deposit boxes.
c. Hire casual employees in the conduct of its business involving deposits.
d. Enter into stipulations exempting it from liability for damages in case or error or
delay in transmitting telegraphic transfers.
70. CPAR Inc. obtained a loan from BDO Unibank secured by a real estate mortgage on its
land. CPAR Inc. defaulted payment, and so the mortgage was foreclosed and the land
was sold at public auction. What is the redemption period of CPAR Inc.?
a. Within three months from the date of the auction sale.
b. Within one year from the date of the auction sale.
c. Until the registration of the certificate of foreclosure sale with the Register of
Deeds, but in no case exceeding three months.
d. Until the registration of the certificate of foreclosure sale with the Register of
Deeds, but in no case exceeding one year.

71. Atty. John Cruz obtained a loan from BOO Unibank secured by a real estate mortgage on
his land. Atty. Cruz defaulted payment, and so the mortgage was foreclosed and the land
was sold at public auction. What is the redemption period of Atty. Cruz?
a. Within three months from the date of the auction sale.
b. Within one year from the date of the auction sale.
c. Until the registration of the certificate of foreclosure sale with the Register of
Deeds, but in no case exceeding three months.
d. Until the registration of the certificate of foreclosure sale with the Register Of
Deeds, but in no case exceeding one year.

72. Which is correct about Rural Banks under R.A. No. 7353?
a. Cooperative cannot purchase shares of stock of a rural bank that has already been
organized or incorporated.
b. Any corporation that is duly registered with SEC may be an incorporator of a
rural bank.
c. All directors of a rural bank must be Filipino citizens.
d. A rural bank may open current or cheeking accounts provided its net assets are
not less than P5,000,000.

73. Which of the following banks Will not qualify as a "Thrift Bank" in accordance with
R.A. No. 7906?
a. Savings and mortgage banks
b. Private development banks
c. Nonstock savings and loans associations
d. Any banking corporation organized for the purpose of investment of savings
deposits, secured capital loans, loans for personal or household finance, housing
loans, marketable securities and other instruments.
74. Which of the following is false relative to 10 foreign banks?
a. A foreign bank may purchase up to 60% of the voting stock of an existing bank in
the Philippines.
b. A foreign bank may invest in up to 60% of the voting stock of a new banking
subsidiary incorporated under the laws of the Philippines.
c. A foreign bank may open its branches in any place of the country for as long as
the minimum capital requirement is satisfied.
d. Each new foreign bank entrant shall be entitled to not more six branches provided
the minimum capital requirements is met.

75. Which act is covered by Domestic Bank Deposit Secrecy Law a.k.a. R.A. No. 1405?
a. Disclosing the amount of deposit of a judgment debtor to the court sheriff who is
executing a garnishment order against him.
b. Disclosing the name of the drawer of a check to the payee.
c. Disclosing the amount of deposit of a taxpayer to a duly authorized BIR examiner
who is examining his income tax liability.
d. Disclosing the amount of deposit exceeding P500,000 in one banking day to Anti-
Money Laundering Council.

76. A government employee, purchased DBP Bonds with a total value of P100,000 and
receives annual interest income from his investment. Under Bank Secrecy Law, the
investment of the government employee may be inquired into without need of a court
order by the
a. Public prosecutor handling estafa case against the government employee
b. BIR officer auditing the VAT of the government employee
c. Credit investigator of a lending institution where the government employee
applied for the loan
d. None or the foregoing

77. A maintained the following deposits at BPI Bank:

P600,000- savings deposit in the name of A and/or B
P200,000- time deposit in the name ABC Partnership
P300,000- current account in the name of A
How much can A personally recover from PDIC if BPI was liquidated by BSP?
a. P900,000
b. P600,000
c. P550,000
d. P300,000

78. Which of the following is covered by R.A No. 3765 also known as Truth in lending Act?
a. Pawnshops
b. Small-loan money lenders
c. Both A and B
d. Neither A nor B
79. Which is false about Foreign Currency Deposit Act also known as R.A. No. 6426?
a. The foreign currency deposits maintained abroad by Filipino citizens are not
covered by the provisions of this act.
b. Depositary banks which have been qualified by the Monetary Board to function
under expanded foreign currency deposit system are exempt in maintain the
fifteen percent (15%) foreign currency cover for their liabilities in the term of
foreign currency deposit with BSP.
c. Foreign currency deposits are of absolutely confidential nature, except upon the
written permission of the depositor.
d. Foreign currency deposits are subject to attachment, garnishment, or any other
order or process of the court.

80. Which is false about contract of chattel mortgage?

a. Registration of the chattel mortgage is made in the Chattel Mortgage Registry of
the Register of Deeds where the property is located.
b. Aside from the Chattel Mortgage Registry of the Register of Deeds where the
property is located, registration shall also be made where the mortgagor resides if
he resides in a place other than where the property is located.
c. Where the parties executed a chattel mortgage on a building, they shall be bound
to the chattel mortgage contract.
d. Failure to execute the Affidavit of Good Faith and to register the chattel mortgage
contract shall invalidate the mortgage.

81. For validity and to bind third persons, where shall chattel mortgage executed on a private
motor vehicle be registered?
a. Chattel mortgage registry where the mongagor resides
b. Land Transportation Office
c. Both A and B
d. Neither A nor B

82. Which is true about real estate mortgage contract?

a. The one-year redemption period is interrupted by the filing of an action
questioning the validity of the foreclosure sale.
b. The mortgagee can recover any deficiency in the foreclosure sale but any excess
or surplus shall be given to the mortgagor.
c. A writ of possession shall be issued in favor the purchaser in an extrajudicial
foreclosure sale even if there is a registered lease contract between the mortgagor-
lessor and the lessee.
d. The purchaser at the extra-judicial foreclosure sale who took possession of the
property without the benefit of a writ of possession cannot be ejected by the
mortgagor.
83. The mortgagor of a property that is the subject of an extra-judicial foreclosure shale
resides in Gingoog City. The property is located in Cagayan de Oro City. The mortgage
contract provided that any action arising from the mortgage shall be filed in Iligan City.
Where shall the foreclosure shall be held?
a. Gingoog City
b. Cagayan de Oro City
c. Iligan City
d. Any of the above

84. The prohibition in recovery of any deficiency in the foreclosure sale of chattel mortgage
under Recto Law or Article 1484 of the New Civil Code of the Philippines is applicable
to:
a. When the object of the chattel mortgage is not the thing sold.
b. When the personal property is sold on a straight-term
c. Both A and B
d. Neither A nor B

85. Which is false about Recto Law regarding Sale of Personal Property in Installments?
a. The remedy of exact fulfillment of the obligation can be availed only where one
installment is not paid.
b. Cancellation of the sale can only be made after default of at least two
installments.
c. An agreement for the recovery of any unpaid balance of the purchase price after
electing to foreclose the chattel mortgage on the thing sold is null and void.
d. The three remedies under Recto Law are alternative and cannot be exercised
simultaneously or successively.

86. B purchased a specific car from S for P1,200,000 payable by a downpayment of

P600,000 and the balance in 12 equal monthly installments of P50,000 each. A chattel
mortgage on the said car was executed to serve as security. B defaulted on the 7th and 8th
monthly installments. The chattel mortgage on the car was foreclosed but the auction sale
resulted into a deficiency of P100,000. Under Recto Law, what is the remedy of S to
recover the deficiency?
a. Auction the other properties of B for P100,000.
b. Cancel the installment sale.
c. File a collection suit for P100,000 against B.
d. No other remedy on the deficiency.
87. Assume the same facts from the preceding number except that in addition to the chattel
mortgage on the motor vehicle, a real estate mortgage was executed as additional security
by G (guarantor) on his land. What is the remedy of S to recover the deficiency on the
foreclosure of chattel mortgage on the said car?
a. Foreclose the real estate mortgage on the land
b. Cancel the installment sale
c. File a collection suit for P100,000 against B.
d. No other remedy on the deficiency.

88. D borrowed P200,000 from C payable in ten monthly installments of P20,000 each. The
credit was secured by a chattel mortgage on D's truck. D defaulted on the 1st and 2nd
installments. The chattel mortgage was foreclosed and truck was sold for P150,000.
Which is correct?
a. C cannot recover the P50,000 deficiency from D because it is prohibited under
Recto Law.
b. C cannot recover the P50,000 from D because there is no recovery of deficiency
in mortgage contract.
c. C can recover the P50,000 deficiency from D because the Recto Law is not
applicable to loans secured by a chattel mortgage.
d. None of the above.

89. Which installment sale is covered by Maceda Law also known as Realty Installment
Buyer Protection Act?
a. Installment sale of condominium dwelling units
b. Installment sale of commercial buildings
c. Installment sale of industrial lots
d. Installment sale of agricultural lands to tenants under the Agrarian Reform
Program

90. Where the installment buyer of residential real property was able to pay less than two
years of installment, what is the grace period earned by him to pay without additional
interest?
a. 30 days
b. 60 days
c. One month
d. Two months

91. Where the installment buyer of residential real property was able to pay two years or
more of installment, what is the grace period earned by him to pay without additional
interest?
a. 30 days for every year of installments paid
b. 60 days for every year of installments paid
c. One month for every year of installments paid.
d. Two months for every year of installments paid.
92. B purchased a residential lot of S for P1,000,000 on installment under the following
terms: P200,000 downpayment on January 2, 2001; P 100,000 every year thereafter until
fully paid. Assume that B defaulted on the very first installment due on January 2, 2002.
What is the grace period to pay without additional interest and cash surrender value
earned by B?
a. 60 days and P0, respectively
b. 60 days and P100,000, respectively
c. 30 days and P100,000, respectively
d. No grace period and no cash surrender value

93. Assume the same facts in preceding number, except that B defaulted on the installment
due on January 2, 2008. What is the grace period to pay without additional interest and
cash surrender value earned by B?
a. 180 days and P440,000
b. 210 days and P540,000
c. 240 days and P620,000
d. 150 days and P530,000

94. Which of the following is covered by the term "Debtor" under FRIA of 2010?
a. Banks
b. Government-owned or controlled corporations
c. Both A and B
d. Neither A nor B

95. Which of the following cases is covered by Stay or Suspension Order issued by
Rehabilitation Court under FRIA of 2010?
a. Cases pending appeal before the Supreme Court as of commencement date of the
Stay or Suspension Order
b. Claims against issuers of letters of credit where the property is not necessary to
the rehabilitation of the debtor
c. Both A and B
d. Neither A nor B

96. Which of the following may be appointed as receiver under FRIA of 2010?
a. A creditor, owner, partner or stockholder of the insolvent debtor.
b. An owner, partner, director, officer or employee of the insolvent debtor or any of
the creditors, or the auditor or accounting of the insolvent debtor within five years
from the filing of the petition.
c. A relative by consanguinity or affinity within fourth civil degree to any individual
creditor, owner of a sole, proprietorship-debtor, partners of a partnership-debtor
or to any stockholder, director, officer, employee or underwriter of a corporation-
debtor.
d. None of the above
97. In which of the following will the creditors have adequate protection over the property
securing their claims under FRIA of 2010?
a. The debtor fails or refuses to honor a preexisting agreement with the creditor to
keep the property insured.
b. The debtor fails or refuses to take commercially reasonable steps to maintain the
property.
c. The property has depreciation to an extent that creditor is undersecured.
d. None of the above.

98. Which of the following petitions amount to an act of insolvency under FRIA of 2010?
a. Voluntary liquidation
b. Suspension of payments
c. Rehabilitation
d. None of the above

99. Which of the following is not a member of Anti- Money Laundering Council?
a. Secretary of Finance
b. Governor of BSP
c. Insurance Commissioner
d. SEC Chairperson

100.Which of the following is considered "covered transaction" under AMLA for a banking
institution?
a. P250,000 or more in one banking day
b. P500,000 or more in one banking day
c. Over P500,000 in one banking day
d. P1, 000,000 or more in one banking day
1. B 47. C 93. A
2. C 48. A 94. D
3. A 49. C 95. D
4. D 50. D 96. D
5. A 51. C 97. D
6. A 52. A 98. A
7. D 53. D 99. A
8. B 54. D 100. C
9. A 55. A
10. B 56. C
11. A 57. A
12. D 58. A
13. D 59. B
14. D 60. D
15. B 61. C
16. D 62. C
17. B 63. C
18. D 64. B
19. C 65. D
20. D 66. A
21. D 67. D
22. A 68. A
23. D 69. B
24. B 70. C
25. A 71. B
26. B 72. D
27. D 73. C
28. B 74. C
29. A 75. C
30. A 76. D
31. C 77. C
32. D 78. C
33. D 79. D
34. C 80. D
35. D 81. C
36. D 82. B
37. B 83. B
38. C 84. D
39. A 85. A
40. B 86. D
41. D 87. D
42. A 88. C
43. C 89. A
44. A 90. B
45. A 91. A
46. B 92. A