1.

I-Any power delegated to the board of directors or trustees to amend or repeal any by-laws
or adopt new by-laws shall be considered as revoked whenever stockholders owning or
representing 2/3 of the outstanding capital stock or 2/3 of the members in a nonstock
corporation, shall so vote at a regular or special meeting.
II-Whenever the by-laws are amended or new by-laws are adopted, the corporation shall file
with the SEC such amended or new by-laws.
(1 Point)
Only I is true.
Only II is true
Both are true.
Both are false.
2. I-A corporation is in a metaphysical sense a resident fo the place where its principal office is
located as stated in the articles of incorporation.
II-The place where the principal office of the corporation is to be located is one of the
required contents of the bylaws
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
3. I-By-laws may be adopted and filed prior to incorporation.
II-In all cases, bylaws shall be effective only upon the issuance by the SEC of a certification
that the bylaws are in accordance with the Revised Corporation Code.
(1 Point)
Only I is true.
Only II is true.
Both are true.
Both are false.
4. I-The by-laws shall be signed by the stockholders or members voting for them and shall be
kept in the principal office of the corporation.
II- A copy of the by-laws, duly certified by the majority of the directors or trustees and
countersigned by the Secretary of the corporation, and shall be filed with the SEC and
attached to the original articles of incorporation.
(1 Point)
Only I is true.
Only II is true.
Both are true.
Both are false.
5. The by-laws of ABC Corporation is silent as to when a stockholder can be qualified to attend
the meeting of the stockholders. The Corporate Secretary sent out the notice of the
stockholders meeting two (2) days before the meeting and at that time X was not yet a
stockholder. On the day of the meeting, however, X became a shareholder which was duly
recorded in the stock and transfer book. Which statement is most accurate?

(1 Point)
X is a stockholder of ABC Corporation as of the time of meeting of the stockholders for the
purpose of electing the members of the board
X is not qualified to elect members of the board because of the time the notice of the meeting
was sent, she was not yet a stockholder.
Qualifications as to who are considered as stockholders on record for purposes of being able to
elect members of the board are to be determined by the by-laws alone.
None of the above
6. I-Any person, partnership, association or corporation, singly or jointly with others, but not
more than 15 in number, may organize a corporation for any lawful purpose or purposes.
II-Natural persons who are licensed to practice a profession, and partnership or associations
organized for the purpose of practicing a profession, shall not be allowed to organize as a
corporation.stion
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
7. EFG Foundation, Inc., a non-profit organization, scheduled on election for its six-members
Board of Trustees. X and Y and Z, who are minority members of the foundation, wish to
exercise cumulative voting in order to protect their interest, although the Foundation’s
Articles and By-laws are silent on the matter. As to each of the three, what is maximum
number of votes that he/she can cast?

(1 Point)
6
9
3
12
8. I-Redeemable shares, once redeemed are retired unless reissuance is expressly allowed in the
articles of incorporation.
II-The Corporation Code allows redemption of share only if there are unrestricted retained
earnings on the books of the corporation.
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
9. I-It acquires a judicial personality either by special law or general law.
II-The general law under which a private corporation may be formed or organized is the
Revised corporation Code.
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
10. Unknown to the other four proponents, Enrico (who had been given the task of attending to
the Articles of Incorporation of the proposed corporation, Auto Mo, Ayos Ko,
misappropriated the filing fees and never filed the Articles of Incorporation with the SEC.
Instead, he prepared and presented to the proposed incorporators a falsified SEC certificate
approving the AOI. Relying on the falsified SEC Certificate, the latter began assuming and
discharging corporate powers. Auto Mo, Ayos Ko is a _________________

(1 Point)
De jure corporation
De facto corporation
Corporation by estoppel
General partnership
None of the above
11. In elections for the Board of Trustees of non-stock corporations, members may cast as many
votes as there are trustees to be elected but may not cast more than one vote for one
candidate. This is true

(1 Point)
Unless set aside by the members in plenary session
In every case even if the Board of Trustees resolves otherwise
Unless otherwise provided in the Articles of Incorporation or in the by-laws.
In every case even if the majority of the members decide otherwise during the elections
12. I-The owners of majority of the outstanding capital stock or majority of the members in a
non-stock corporation may delegate to the board of directors or trustees the power to
amend or repeal any by-laws or adopt new by-laws.
II-The amended or new by-laws shall only be effective upon the issuance by the SEC of a
certification that the same are not inconsistent with the Revised Corporation Code.
(1 Point)
Only I is true.
Only II is true.
Both are true.
Both are false.
13. X is a director in T Corp. who was elected for a one-year term.
On Feb.1, 2010. On April 11, 2010, X resigned and was replaced by R, who assumed as
director on May 17, 2010. On Nov. 21, 2010, R died. S was then elected in his place. Until
which time should S serve as directors?
(1 Point)
April 11, 2011
February 1, 2011
May 17, 2011
November 21, 2011
14. The capital stock of BAC Corporation is divided into common shares and preferred shares.
Preferred shares are preferred as to dividends and common shares are those shares which
have the regular and ordinary attributes of a share of a corporation. Which statement Is most
accurate?

(1 Point)
This kind of classification may not be allowed or else it will violate the Doctrine of Equality of
Shares
Classification of shares may be allowed for as long as it is clearly stated as such in the Articles of
Incorporation
Classification of shares is mainly for business purposes to attract investors
Classification of shares may be allowed with the approval of the stockholders and the Board of
Directors
15. The term of one (1) year of the Board of Directors of AAA Corporation expired last February
15, 2012. No new election of the Board of Directors was called, hence, the existing members
of Board continue as Directors in hold-over capacity. Which statement is most accurate?

(1 Point)
This is allowed provided there is a valid and justifiable reason for not calling for an election of the
new members of the Board.
This is not allowed because the term of the directors must only be one (1) year
The positions of the members of the Board of Directors will be automatically declared vacant.
Acting as members of the Board of Directors in hold-over capacity must be ratified by the
stockholders.
16. I-One of the rights of a stockholder is the right to participate in the control and management
of the corporation that is exercised through his vote.
II-The right to vote is a right inherent in and incidental to the ownership of corporate stock,
but it is not a property right.
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
17. I-A corporation is in a metaphysical sense a resident of the place where its principal office is
located as stated in the articles of incorporation.
II-The place where the principal office of the corporation is to be located is one of the
required contents of the by-laws.
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
18. I-A corporation can change its name by amending its by-laws.
II-Where a corporation has more than one stated purpose, the by-laws shall state which is the
primary purpose and which is/are the secondary purpose or purposes.
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
19. X. Corporation, operates a call center that received orders for pizzas on behalf of Y
Corporation which operates a chain of pizza restaurants. The two companies have the same
set of corporate officers. After 2 years, X Corporation dismissed its call agents for no apparent
reason. The agent filed a collective suit for illegal dismissal against both X and Y Corporation
based on the doctrine of piercing the veil of corporate fiction. The latter set up the defense
that the agents are in the employ of X Corporation which is a separate juridical entity. Is this
defense appropriate?

(1 Point)
No, since the doctrine would apply, the two companies having the same set of corporate officers.
No, the real employer is Y Corporation, the pizza company, with X Corporation serving as an arm
for receiving its outside orders for pizzas.
Yes, it is not shown that one company completely dominates the finances, policies, and business
practices of the other.
Yes, since the two companies perform two distinct businesses.
20. The BIR assessed ABC Corp for deficiency income tax for taxable year 2020 in the amount of
P26,731,208.00 inclusive of surcharge and penalties. The BIR can ____
(1 Point)
Run after the Directors and officers of ABC Corp to collect the deficiency tax and their liability will
be solidary.
Run after the stockholders of ABC Corp and their liability will be joint
Run after the stockholders of ABC Corp. and their liability will be solidary
Run after the unpaid subscriptions still due to ABC Corp., if any
None of the above choices is correct
21. A private corporation may provide the following in its by-laws.
(1 Point)
The modes by which a stockholder, member, director, or trustee may attend meetings and cast
their votes.
The form for proxies of stockholders and members and the manner of voting them.
The manner of election or appointment and the term of office of all officers other than directors
or trustees.
All of the above.
22. X owns 99% of the capital stock of SSS Corporation. X also owns 99% of TTT Corporation. SSS
corporation obtained loan from VW Bank. On due date, SSS Corporation defaulted. TTT
Corporation is financially healthy. Which statement is most accurate?
(1 Point)
X being a controlling owner of SSS Corporation can automatically be held personally liable for
the loan of SSS Corporation
TTT Corporation, owned 99% by X, can automatically be held liable.
SSS Corporation and TTT Corporation, although both are owned by X, are two (2) distinct
corporations with separate juridical personalities hence, the TTT Corporation cannot
automatically be held liable for the loan of SSS Corporation
The principle of piercing the veil of corporate fiction can be applied in this case.
23. A, the proprietor of a fleet of ten taxicabs, decides to adopt, as his business name, “A
Transport Co. Inc.,” May this be allowed?
(1 Point)
No, it would be deceptive since he is a proprietor, not a corporation
No, since “A” is a generic name, not suitable for registration
Yes, since his line of business is public transportation
Yes, since such name would give his business a corporate identity.
24. A class of stock entitling the holder to vote on corporate matters, to receive dividends after
other claims and dividends have been paid (specially to preferred stockholders) and to share
in assets upon liquidation.
(1 Point)
Common stock
Preferred stock
Treasury stock
Redeemable stocks
25. The Corporation code sanctions a contract between two or more corporations which have
interlocking directors, provided there is no fraud that attends it and it is fair and reasonable
under the circumstances. The interest of an interlocking director in one corporation may
either substantial or nominal. It is nominal if his interest:
(1 Point)
Does not exceed 25% of the outstanding capital stock
Exceeds 25% of the outstanding capital stock
Exceeds 20% of the outstanding capital stock
Does not exceed 20% of the outstanding capital stock.
26. I- well-settled is the principle that the corporate mask may be removed or the corporate veil
pierced when the corporation is just an alter ego of a person or of another corporation.
II- It is a basic principle in Corporation Law that a corporation has a personality which is the
same as the officers or members who compose it
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
27. Two requisites must concur before one may be classified as a stock corporation, namely:
I- That it has capital stock divided into shares
II- That it is authorized to distribute dividends and allotments of surplus and profits to its
members.
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
28. I-The purpose of a by-law is to regulate the conduct and define the duties of the members
towards the corporation and among themselves.
II-By-laws are the relatively permanent and continuing rules of action adopted by the
corporation for its own government and that of the individuals composing it and having the
direction, management and control of its affairs, in whole or in part, in the management and
control of its affairs and activities.
(1 Point)
Only I is true.
Only II is true.
Both are true
Both are false.
29. I-Before rejecting the articles of incorporation or disapprove its amendments, the SEC should
give the incorporators reasonable time within which to correct or modify the objectionable
portions of the articles or amendments.
II-The general rule as to corporations is that each corporation must have a name by which it
is to sue and be sued and do all legal acts.
(1 Point)
Only I is true
Only II is true
Both are true
Both are false
30. I-Redeemable shares, once redeemed are retired unless reissuance is expressly allowed in the
articles of incorporation.
II-The Corporation Code allows redemption of shares only if there are unrestricted retained
earnings on the books of the corporation
(1 Point)
Only I is true
Only II is true
Both are true
Both are false