FINAL EXAM GRADUATING

GENERAL INSTRUCTION: Write all your answers in the exam booklet.

I. Fill in the blanks. 20 points. Write the missing word in your exam booklet.

A 1. _____ is an 2. ______ being 3. _____ by 4. _____ of 5. ______, having the 6. ______

of 7. _______ and the powers, 8._____ and properties expressly 9. ______ by law or incident
to its 10._______ .

II. Multiple choice. Write the letter of your choice in your exam booklet.

1) B.P. 68 is also known as:

a. Corpo Code b. The Corporation Code of the Philippines c. Philippine

Corporation Code d. None of the above

2) The Corporation Code took effect on:

a. May 7, 1980 b. May 3, 1983 c. May 12, 1952 c. May 16, 9179

3) A doctrine of corporate law that a private corporation is a national, citizen, resident, or

inhabitant of the country or state, by or under the laws of which it is created or organized.

a. Incorporation Rule b. Control Test c. Grandfather Rule d.

Foreign Corporation

4) Under ______________, the citizenship or nationality of a corporation is determined by

the citizenship of its controlling stockholders.

a. Incorporation Rule b. Control Test c. Grandfather Rule d.

Foreign Corporation

5) Section 3 of B.P. 68 refers to two kinds of corporation.

a. Foreign and Domestic Corporation b. Private and Public Corporation c. Profit and
Non-Profit corporation d. Stock & Non-Stock Corporation

6) ________ are private corporation which have a capital stock divided into shares and are
authorized to distribute to the holders of such shares dividends or allotments of the surplus
profits on the basis of the shares held are stock corporations.

a. Non-Stock Corporation b. Stock Corporation c. Business Corporation d. Non

Government Corporation

7) _________ are those that do not issue stocks.

a. Non-Stock Corporation b. Stock Corporation c. Business Corporation d. Non

Government Corporation

8) Corporations engage in the delivery of basic services such as water and electricity are
classified as:

a. Non-Stock Corporation b. Stock Corporation c. Business Corporation d. Quasi

Public Corporation

9) ____________ corporation is one incorporated under Philippine Laws

a. Domestic Corporation b. Stock Corporation c. Business Corporation d. Quasi

Public Corporation

10) _________corporation is one formed, organized or existing under any laws other than
those of the Philippines.

a. Domestic Corporation b. Stock Corporation c. Foreign Corporation d. Alien Corporation

11) _______________ are those who composed a corporation, whether as stockholders or
members.

a. Incorporators b. Corporators c. Members d. Stockholders

12) ______________ are those stockholders or members mentioned in the articles of

incorporation as originally forming and composing the corporation and who are signatures
thereof.

a. Incorporators b. Corporators c. Members d. Stockholders

13) Stockholder/Shareholders is to stock corporations as __________ is to Non-Stock

Corporations

a. Incorporators b. Corporators c. Members d. Stockholders

14) BOT is to Non-Stock Corporations as __________ is to stock corporations

a. Incorporators b. Corporators c. Board of Directors d. Stockholders

15) __________ is the act of procuring the initial finances and the making of all preparations
necessary to launch a corporation

a. Subscription b. Promotion c. Capitalization d. Public Offer

16) A _______ is one of the units into which the capital stock has been divided.

a. ‘Stock” or Share of Stock b. Stock Certificate c. Stock Corporation d. Share/Stockholder

17) A ________ certifies that one is a holder or owner of a certain number of shares of stock in
the corporation.

a. ‘Stock” or Share of Stock b. Stock Certificate c. Stock Corporation d. Share/Stockholder

18) Shares without par value may not be issued for a consideration less than the value of
_______ per share.

a. (Php5.00) five pesos per share b. (Php6.00) six pesos per share
c. (Php7.00) seven pesos per share d. (Php4.00) four pesos per share

19) ___________ is a share of stock that is given a fixed or definite value in the articles of
incorporation.

a. No Par Value Share b. Par Value Share c. Non voting Share d.

Subscribed Share

20) The principal purpose of a par value share is to fix a minimum subscription or original issue
price of the shares.

a. True b. False c. Maybe d. Whatever

21) An unpaid share can vote in an election to choose the Board of Directors.

a. True b. False c. Maybe d. Whatever

22) A delinquent share can vote in an election to choose the Board of Directors.

a. True b. False c. Maybe d. Whatever

23) Holders of preferred stock are entitled to receive dividends on their shares, to the extent
agreed upon, before any dividends at all are paid to the holders of common stock.

a. True b. False c. Maybe d. Whatever

24) _____________ the act of creating a corporation.

a. Subscription b. Promotion c. Capitalization d. Incorporation

25) Minimum number of incorporators

a. 5 b. 15 c. 3 d. 12

26) Maximum number of incorporators

a. 5 b. 15 c. 3 d. 12

27) A juridical person may be an incorporator

a. True b. False c. Maybe d. Whatever

28) The incorporators must own or be a subscriber to at least __________ share of the capital
stock of the corporation.

a. 5 b. 15 c. 3 d. 1

29) Corporate Term

a. 50 years b. 50 years extendible for another 50 years c. 25 years extendible for

another 25 years d. 25 years

29) A foreign corporation can own agricultural land.

a. True b. Whatever c. Maybe d. False

30) A domestic corporation can own industrial land.

a. True b. False c. Maybe d. Whatever

31) One week written notice is a must for a regular shareholder’s meeting.

a. True b. Whatever c. Maybe d. False

32) One day written notice is a must for a regular Board of Director’s meeting.

a. True b. Whatever c. Maybe d. False

33) The meeting of shareholders may be conducted outside of the country.

a. Maybe b. Whatever c. True d. False

34) A licensed foreign corporation may sue and be sued here in the Philippines.

a. Maybe b. Whatever c. True d. False

35) The statement: “The by-laws of the corporation may provide for such other officers or agents
as may be necessary and convenient for the corporation.” is:

a. Maybe b. Whatever c. True d. False

36) The statement: “ A director is fiduciary position” is:

a. True b. Who cares c. Falsed. Maybe

36) The statement: “Corporate powers are exercised through the individual stockholders.” is:

a. True b. Whatever c. Maybe d. False

37. _____ is a method voting a BOD wherein a stockholder may vote such number of shares for
as many persons as there are directors chosen:

a. Cumulative Voting b. Voting Trust Agreement c. Straight Voting

d. Proxy

38. At the organization of a corporation, at least 25% of the total authorized capital stock must
be subscribed; then 25% of the total subscribed stock must be paid up.
a. Maybe b. Whatever c. True d. False

39. No corporate name may be allowed by the SEC if the proposed name is identical or
deceptively or confusingly similar to that of any existing corporation or to any other name
already protected by law or is patently deceptive, confusing or contrary to existing laws.

a. True b. Whatever c. Maybe d. False

40. Corporate existence commences upon the filing of the application of the corporation with
the SEC.

a. True b. Who cares c. Falsed. Maybe

41. The statement: “A director representing the minority may be removed without cause” is:

a. True b. Whatever c. Maybe d. False

42. The statement: “The by-laws of the corporation may provide for such other officers or agents
as may be necessary and convenient for the corporation.” is:

a. Maybe b. Whatever c. True d. False

43. The statement: “Teleconferencing of BOD or BOT allowed director.” is:

a. True b. Whatever c. Maybe d. False

44. The statement: “A BOD may be removed without cause” is:

a. False b. Whatever c. Maybe d. True

45. Which does not belong to the group?

a. president b. auditor c. secretary d. treasurer

46. The statement: “All of the Board of Directors must be residents of the Philippines is:

a. What? b. True c. Who cares d. False

47. The statement: “An executive committee is not similar to the board of directors.” is:

a. True b. Who Cares c. Falsed. I was at Q Bar Last Night

48. What is the term of office of a BOT or BOD?

a. 5 years b.1 year c. 2 years d. 4 years

49. Which does not belong to the group?

a. They must be good looking b. They must be loyal c. They must be obedient.

d. They must be diligent

50. The statement: “ The total yearly compensation of directors shall not exceed twenty per cent
of the net income before income tax of the corporation” is:

a. True b. Who cares c. Falsed. I quarreled with my significant other last night

51. ______ are persons who serve as member of the board of directors of two or more
competing corporations or corporations engaged in practically the same kind of business.

a. Corporate Opportunity b. Interlocking Directors c. Corporate Secrets d. Secrets Profits

52. The statement: “A BOD may be removed without cause” is:

a. True b. Who cares c. Falsed. Ay mat nano ini!

53. The statement: “A director representing the minority may be removed without cause” is:

a. True b. Who cares c. Falsed. No idea

54. In order that the prohibitions mentioned in Sec. 27 should apply it must be committed with
in ______ prior to his election or appointment as BOD.

a. 5 years b.1 year c. 2 years d. 4 years

55. ________ signifies the number of persons belonging to a corporation required to transact
business.

a. Majority b. Minority c. Derivative Suit d. Quorum

56. The statement: “A president need not be a director.” is:

a. True b. Who cares c. Falsed. No idea

57. The statement: “A treasurer need not be a director.” is:

a. True b. False c. I’m graduating please give me a passing grade. d. No idea

58. The statement: “A corporate secretary shall be a resident and citizen of the Philippines.” is:

a. No idea b. False c. I’m graduating please give me a passing grade. d. No idea

59. The statement: “Teleconferencing of BOD or BOT allowed director.” is:

a. Who cares b. False c. I’m not done with my thesis I’m panicking. d. No
idea

60. The statement: “ Board Of Directors are not elected” is:

a. My parents will be proud if I graduate on time. b. True b. Who cares c. False

61. The statement: “A BOD may be elected by proxy.” is:

a. True b. Who cares c. Falsed. None of the Above

62. The statement: “A BOD can vote by proxy” is:

a. False b. Who cares c. True d. None of the Above

63. The statement: “A BOD is a representative of the shareholders and not the corporation.” is:

a. False b. Who cares c. True d. None of the Above

64. The statement: “Corporate powers are exercised through the individual stockholders.” is:

a. False b. Who cares c. True d. None of the Above

65. Payments to capital stock subscriptions are not confined to cash alone.

a. False b. Who cares c. True d. None of the Above

66. A person who votes for and thus represents the stockholders or members in an election.

a. Cumulative Voting b. Voting Trust Agreement c. Straight Voting

d. Proxy

67. One where a new corporation is created and consolidating corporations are extinguished.

a. Consolidation b. Merger c. Dissolution d. Appraisal Right

68. Right to subscribe to new shares of stock in proportion to his existing stock holding, before
the new shares are issued to others.

a. Consolidation b. Pre-emptive Right c. Dissolution d. Appraisal Right

69. Right to withdraw from the corporation and demand payments of the fair value of his shares
after dissenting from certain corporate acts involving fundamental changes in corporate
structure.

a. Consolidation b. Pre-emptive Right c. Dissolution d. Appraisal Right

70. One organized for an eleemosynary purpose and where no part of its income is distributable
to its members, trustees or officers.

a. ‘Stock” or Share of Stock b. Stock Certificate c. Stock Corporation d. Non-Stock

Corporation

71. An agreement by which stockholders surrender their voting power and place it irrevocably in
the hands of others for a definite period of time

a. Cumulative Voting b. Voting Trust Agreement c. Straight Voting

d. Proxy

72. Means the resolution, or its notification or the time when the subscribed shares become
payable.

a. Call b. Voting Trust Agreement c. Straight Voting d. Proxy

73. Profits or that portion of the profits of the corporation which its board of directors, by proper
resolution, sets apart for rotable distribution among the stockholders.

a. Call b. Voting Trust Agreement c. Dividends d. Proxy

74. Power to sue is lodged with BOT or BOD

a. False b. Who cares c. True d. None of the Above

75. The paid-up capital shall not be less than ______

a. five hundred pesos b. five thousand pesos c. six thousand pesos d. five pesos

III. Write five promises that you will keep once you graduate that would benefit your family,
country or other people. Write the promises in your exam booklet.