1.

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

2. 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 tocthe common fund

3. 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 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

4. 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. 10,000.00 c. P3,000.00 d. P30,000.00

5. 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 require juridical personality

d. still acquires juridical personality

 6. Joseph and Edward entered into a universal partnership of all present property. At the time of their
agreement, Joseph has a four-door apartment which he inherited from his father 3 years later. Edward,
on the other hand, had a fishpond which he acquired by dacion em pago from 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 by
way 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.

7. Vincent and James entered into a universal partnership of profits. At the time of execution of 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 he 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

8. A partnership formed for the exercise of a profession which is duly registered is an example of:

a. Universal partnership of profits

b. Universal partnership of all present property

c. Particular partnership

d. Partnership by estoppels

9. 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 a public officer.

10. 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 Joan, 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 estoppels

11. Refer to No. 10. Assuming that JAW Enterprises was unable to pay the loan on due date at which
time the assets of the partnership amounted only to P120, 000.00. From whom may Carlos collect the
payment?

a. Simon only for the whole amount of P120,000.00

b. John, Albert and Wilfred who are liable jointly for P50,000.00 each.

c. JAW Enterprises for its assets of P120,000.00; thereafter John, Albert and Wilfred from their separate
property at P10,000.00 each.

d.JAW Enterprises for its assets of P120.000.00; thereafter, John, Albert, Wilfred and Simon from their
separate assets at P7,500.00 each.

12. Teresa, Olga, Pamela and Sonia, partners in TOPS Company Limited, a trading company, have
contributions of P50,000.00 each. Teresa and Olga are general partners; Pamela, a limited partner; and
Sonia, a general-limited partner. TOPS Company Limited purchased merchandise on credit from Moret
Sales Co. amounting to P180,000.00. On due date, however, TOPS Company Limited was unable to pay.
Accordingly, Moret Sales Co. filed a case of collection against the partnership which by then had assets
amounting to P150,000.00. From whom may Moret Sales Co. collect the sum of P180,000.00?

a. the partnership for its assets of P150,000.00; thereafter, from Teresa and Olga at P15,000.00 each
from their separate assets.

b. Teresa and Olga only at P90,000.00 each from their separate assets.
c. The partnership for its assets of P150,000.00; thereafter, from Teresa, Olga and Sonia at P10,000.00
each from their separate property. However, Sonia can recover P5,000.00 each from Teresa and Olga.

d. Teresa, Olga and Sonia at P60,000.00 each. Thereafter, Sonia can recover from Teresa and Olga
P30,000.00 each.

13. Which of the following losses will not cause the dissolution of a partnership?

a. Loss before delivery of a specific thing which a partner has promised to contribute to the partnership.

b. Loss of a specific thing after its delivery to and acquisition of its ownership by the partnership from the
partner contributed the same.

c. Loss after delivery of a specific thing where the partner contributed only its use and enjoyment, he
having reserved the ownership thereof.

d. Loss before delivery of a specific thing where the partner promised to contribute only its use and
enjoyment, reserving the ownership thereof.

14. 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, P900.00; 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.

15. Which of the following stipulations is valid?

a. A stipulation excluding a capitalist partner from profits.

b. A stipulation exempting a capitalist partner from losses.

c. A stipulation exempting an industrial partner from losses.

d. A stipulation excluding an industrial partner from profits.

16. A partner can engage in business for himself without the consent of his co-partners if he is:

a. a capitalist partner whether or not the business he will engage in is of the same kind as or different
from the partnership business.
b. an industrial partner whether or not the business he will engage in is of the same kind as or different
from the partnership business.

c. a capitalist partner and the business he will engage in is of a kind different from the partnership
business.

d. an industrial partner and the business he will engage in is of a kind different from the partnership
business.

17. Which of the following statements is false when no one among the partners was appointed as
manager?

a. Each partner will be considered as agent of the partnership.

b. Any one may make an important alteration in the immovable property of the partnership without the
consent of the others provided it is useful to the partnership.

c. In case the act of one partner is opposed by another, the decision of the majority of the partners will
prevail.

d. In case of a tie in the voting, the tie shall be resolved by the vote of the partner owning the controlling
interest.

18. The following statements pertain either to a partner appointed as manager in the articles of
partnership or through a document after the formation of the partnership.

I. He may be removed as manager only for a just or lawful cause by the vote of the partners owning the
controlling interest.

II. he may be removed as manager with or without just or lawful cause by the vote of the partner owing
the controlling interest.

III. He may perform all acts of administrator despite the opposition of his partners provided he is in good
faith.

IV. He may perform all acts of administration in good faith but opposing partners may resort to his
removal if he persists.

Based on the foregoing:

a. I and III pertain to a partner appointed as manager in the articles of partnership.

b. I and III pertain to a partner appointed as manager through a document after the formation of
the partnership.
c. II and III pertain to a partner appointed through a document after the formation of the
partnership.
d. I and IV pertain to a parent appointed as manager in the articles of partnership.
19. Campos, Urbano, Tamesis and Encanto are partners in CUTE Company each one contributing
P300,000.00 except for Encanto who is an industrial partner. The partners agreed that Campos shall be
exempted from liability to third persons. Three years of continued losses after the formation of the
partnership resulted in unpaid partnership liabilities to third persons amounting to P500,000.00.
Partnership assets have also been reduced to P200,000.00. From whom may third persons collect the
partnership debts?

a. From the partnership assets of P200,000.00; thereafter, from the partners for their separate assets at
P100,000.00 each except for Campos who was exempted from liability to third persons by agreement.

b. From the partnership assets of P200,000.00; thereafter, from the partners for their separate assets at
P100,000.00 each except for Encanto since an industrial partner does not share in the losses.

c. From the partnership assets of P200,000.00; thereafter. From all the partners for their separate assets
at P75,000.00 each including Campos and Encanto.

d. From the partnership assets of P200,000.00; thereafter, from Urbano and Tamesis only for their
separate assets at P150,000.00 since Campos was exempted from liability by agreement, while Encanto,
being an industrial partner is not liable for losses.

20. The partnership will bear the risk of the loss of three of the following things. Which is the exception?

a. Things contributed to be sold.

b. Fungible things or those that cannot be kept without deteriorating.

c. Things contributed so that only their use and fruits will be for the common benefit.

d. Things brought and appraised in the inventory.

21. A partner’s interest in the partnership is his share of the profits and surplus which he may assign to a
third person . Which of the following statements concerning such right is correct?

a. The conveyance of a partner’s interest will cause the dissolution of the partnership.

b. The assignee becomes a partner.

c. The assignee has a right to interfere in the management of the partnership business.

d. The assignee has the right to receive the profits which the assigning partner would otherwise be
entitled to.

22. Torres is indebted for P5,000.00 to MACE Trading Company, a partnership managed by Mendoza to
whom Torres also owes P10,000.00. The two debts which are both demandable are unsecured. Torres
remits P4,500.00 to Mendoza in payment of his debt to him. Accordingly, Mendoza issues a receipt for
his own credit. To which credit should the payment be applied?
a. To Mendoza’s credit because the payment made by Torres is intended for his debt to Mendoza who
issues his own receipt.

b. To both the partnership credit and Mendoza’s credit proportionately at P1,500.00 and P3,000.00,
respectively.

c. To Mendoza’s credit because its amount is greater than that of the partnership credit.

d. To the partnership credit because the managing partner should not prefer his own interest to that of
the partnership.

23. In three of the following wrongful acts of partners, the partnership is solidarily liable with all the
partners to third persons. Which one is the exception?

a. For loss or injury cause to a third person by reason of the wrongful act or omission of a partner acting
in the ordinary course of business

b. Where a partner acting within the scope of his apparent authority receives money or property of a
third person and misapplies it.

c. Where the partnership receives money or property of a third person in the ordinary course of business
and such money or property is misapplied by a partner while it is in the custody of the partnership.

d. For loss or injury caused to a third person by reason of the use of partnership property by a partner
for personal use.

24. Benito, Ignacio, Gregorio, Artemio and Servando are partners in BIGAS Company which is engaged in
the buying and selling of rice. Benito is the manager. Ignacio was also given a special power of attorney
by the partnership to buy a van for the company. No other power was given to all the partners. In which
of the following acts or contracts is the partnership not bound by the act of the partner?

a. Ignacio buying rice for the partnership from Teodoro who has no knowledge of Ignacio’s lack of
authority.

b. Ignacio buying a van from the partnership from Teresa.

c. Gregorio buying a van for the partnership from Thelma who has no knowledge of Gregorio’s lack of
authority.

d. Benito selling rice for the partnership

25. Assuming that no fraud is committed by or consented to by the partner concerned, which of the
following statement is false?

a. Notice to any partner relating to partnership affairs while already a partner is notice to the
partnership.
b. Knowledge of a partner acting on the particular matter acquired by him while already a partner is
knowledge of the partnership.

c. Knowledge of a partner acting on the particular matter obtained by him before he became a partner is
knowledge of the partnership provided he still remembers the same.

d. Knowledge of partner not acting on the particular matter obtained by him before he became a partner
is knowledge of the partnership.

26. Which of the following statements is incorrect?

a. Partnership creditors are preferred as to partnership assets.

b. Partnership creditors are preferred as to each partner’s separate assets.

c. A partner’s separate creditors are preferred as to the partner’s separate assets.

d. A partner’s separate creditors may attach a partner’s share in the partnership assets.

27. The change in the relation of the partners caused by any ceasing to be associated in the carrying on
the business is known as:

a. termination of the partnership

b. winding up of partnership affairs

c. liquidation of the partnership business

d. dissolution of the partnership.

28. A decree by the court is necessary to dissolve a general partnership based on three of the following
grounds. Which one will not require such decree but will cause the automatic dissolution of the
partnership?

a. The business of the partnership can only be carried on at a loss

b. A partner is shown to be of unsound mind

c. A partner has been guilty of such conduct as tends to affect prejudicially the carrying on of the
business.

d. A partner is civilly interdicted

29. Three of the following will cause the automatic dissolution of a general partnership. Which one will
not?

a. When any event makes it unlawful for the business of the partnership to be carried on or for the
members to carry it on in partnership.
b. Expulsion of any partner from the business bona fide in accordance with such a power conferred by
the agreement between the partners.

c. A partner becomes in any way incapable of performing his part of the partnership contract.

d. The insolvency of a partner or of the partnership.

30. When is the partnership not bound by the act/s of a partner after dissolution in the following cases?

a. Acts necessary to wind up partnership affairs

b. Acts to complete transactions begun before dissolution

c. New transactions where the third person is a previous creditor and there was a publication of the
dissolution in a newspaper of general circulation in the place or places where the business had been
carried on but such third person has not read it.

d. New transactions where the third person is a new creditor and there was a publication of the
dissolution in a newspaper of general circulation in the place or places where the business had been
carried on but such creditor has not read it.

31. The partnership is not bound in three of the following acts of a partner after dissolution. However, it
is bound in one. Which is it?

a. Where the partner acting is insolvent

b. When it is unlawful to carry on the business

c. When the partner has no authority to wind up partnership affairs and the third person is a previous
creditor who had no knowledge of the partner’s lack of authority

d. When a partner has no authority to wind up partnership affairs and the third person is a new creditor
who has not read the publication of the lack of authority of the partner in a newspaper of general
circulation in the place or places where the partnership business is carried on

32. What is the order of payment of liabilities of a dissolved general partnership using the code number
representing each liability?

I. Those owing to partners other than for capital or for profits

II. Those owing to creditors other than partners

III. Those owing to partners in respect of profits

IV. Those owing to partners in respect of capital

a. I, II, III, IV
b. II, I, IV, III
 c. II, I, III, IV
d. I, II, IV, III

33. In a limited partnership where there are 4 partners:

a. All the partners must be limited partners

b. The number of limited partners must be equal to the number of general partners, that is, 2:2

c. The number of limited partners must be greater than the number of general partners, that is, 3:1

d. It is enough that there is one limited partner; the rest may all be general partners

34. A limited partner may contribute:

a. Money and /or property

b. Money and /or services

c. Property and /or services

d. Services only

35. A limited partner shall be liable as general partner in three of the following cases. Which one is the
exception?

a. Where he is a general-limited partner as stated in the certificate

b. When he takes part in the control of the business

c. When he participates in the management of the business

d. When his surname which appears in the partnership name is also the surname of a general partner

36. Which of the following omission will make a partnership formed as a limited partnership liable as a
general partnership?

I. The certificate is not signed and sworn to by all the partners

II. The certificate is not registered with the Securities and Exchange Commission

III. The partnership name does not include the word ‘’Limited” or “Ltd”, its abbreviation, in the certificate

a. I and II
b. II and III
c. I and IIII
d. I, II and III
 37. A person admitted to all the rights of a limited partner who has died or has assigned his interest
in the partnership is known as:

a. An ostensible partner

b. A liquidating partner

c. A substituted limited partner

d. A general-limited partner

38. If the assignee does not become the partner referred to in the preceding number, his rights do
not include:

a. The receipt of the assignor’s share of the profits

b. The receipt of the assignor’s other compensation by way of income

c. The return of the assignor’s contribution

d. The inspection of partnership books or account of partnership transactions

39. What is the order of payment of liabilities of a dissolved limited partnership using the code number
representing each liability?

I. Those owing to general partners other than for capital or for profits.

II. Those owing to creditors including limited partners, except those to limited partners on account of
their contributions and general partners.

III. Those owing to limited partners by way of their share in the profits and other compensation by way
of income.

IV. Those owing to limited partners in respect to the capital of their contributions.

V. Those owing to general partners in respect of capital

VI. Those owing to general partners in respect of profits.

a. I, II, III, IV, V, VI

b. II, I, III, IV, V, VI
c. II, I, III, IV, VI, V
d. II, III, IV, I, VI, V

40. Which of the following will not cause the automatic dissolution of a limited partnership?

a. Death of a general partner

b. Death of a limited partner

c. Insolvency of a general partner

d. Insanity of a general partner

41. One of the distinctions between a partnership and a corporation is that a partnership:

a. May be formed by one person

b. In created by the operation of law

c. Acts through a board of directors

d. May exist for an indefinite period

42. Belinda, Ara, Rica and Klaudia are partners in BARK Enterprises, a pet shop, with Belinda contributing
P50,000.00, Ara, P20,000.00 and Rica, P30,000.00. Klaudia is an industrial partner and manages the
partnership. Based on the foregoing information, which of the following statements is false?

a. Belinda may engage in the buying and selling of rice without the consent of the other partners.

b. Klaudia may engage in the buying and selling of rice without the consent of the other partners.

c. Klaudia is not liable for the losses of the partnership.

d. Klaudia may be held liable by third persons for partnership debts with her separate property.

43. Josephine, Ellen, Wilma, Edith and Lydia are partners in JEWEL Company, Ltd. Josephine, Ellen and
Wilma are general partners, Edith is a general-limited partner, while Lydia is a limited partner. Based on
the foregoing information, which of the following statement is false?

a. Josephine, Ellen and Wilma may be held liable with their separate property after the exhaustion of
partnership assets

b. Edith may participate in the management of the partnership

c. Edith may not be held liable with her separate property for partnership debts after the exhaustion of
partnership assets

d. Lydia may not be held liable with her separate property for partnership debts after the exhaustion of
partnership assets

44. Which of the following will not cause the automatic dissolution of general partneship?

a. Death of a partner

b. Insolvency if a partner

c. When the partnership business becomes unlawful

d. Insanity of a partner

45. Wilma, Olga and Wynona agreed to form a limited partnership with Wilma and Olga as general
partners contributing P50,000.00 each, and Wynona as limited partner contributing P100,000.00. The
partnership which is to engage in the trading of garments was named ‘’WOW Garments Co., Limited” as
indicated in the certificate signed and sworn to by the partners before a notary public. However, the
certificate was not filed with the Securities and Exchange Commission. In the meantime, the partners
already operating began operating the business and transacting with third persons.

a. The partnership entered into by the Wilma, Olga and Wynona is void

b. The partnership will be considered a general partnership. Accordingly, all partners will be liable with
their separate property after the exhaustion of partnership assets

c. The partnership will be considered a limited partnership as indicated in its name. Only Wilma and Olga
will be liable with their separate property after the exhaustion of partnership assets

d. Wilma, Olga and Wynona will be considered separately as sole proprietors with each one having a
capital equivalent to their respective contributions,

46. Fernando, Filoteo, Fortunato and Fulgencio are partners in the firm F4 Enterprises which is engaged
in the trading of fertilizers. Fernando contributed P50,000.00 Filoteo, P30,00.00; and Fortunato,
P20,000.00. Fulgencio is an industrial partner and manages the partnership. Based on the foregoing
facts, which of the following statements is incorrect?

a. Fernando may engage in the business of trading car spare parts without the consent of the other
partners.

b. Filoteo may be validly exempted from losses incurred by the partnership by agreement of the
partners.

c. Fulgencio may not engage in the car repair business without the consent of his co-partners

d. Fulgencio is exempt from losses although there is no agreement among the partners

47. Bettina, Erlinda, Amanda, Ursula, Teresa and Yolanda are partners in BEAUTY Enterprises, a dealer in
cosmetics and other beauty 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
a 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.

48. Which of the following will not cause the automatic dissolution of a general partnership?

a. Death of a capitalist partner

b. Insolvency of a capitalist partner

c. Insanity of an industrial partner

d. Civil interdiction of an industrial partner

49. PATOK Enterprises, a partnership engaged in the business of renting out video films, is owned by
Patricia, Alice, Tina, Olga and Kaye, with Kaye as the manager. Diana owes PATOK Enterprises P6,000.00
and Olga, P4,000.00. Both debts are unsecured and are due. Diana pay Olga P4,000.00 for which Olga
issues her own receipt.

a. The payment should be applied to Olga’s credit only

b. The payment should be applied to PATOK’s credit only.

c. The payment should be divided proportionately between PATOK and Olga, at P2,400.00 and P1,600.00,
respectively.

d. The payment should be divided equally between PATOK and Olga at P2,000.00 each.

50. Federico, Alberto, Sofronio and Teodoro are partners in FAST Motorparts Company, a dealer of car
spare parts. . Federico, Alberto and Sofronio invested P500,0000.00, P200,000.00 and P300,000.00,
respectively. Teodoro is an industrial partner who manages the partnership. The partners have stipulated
that Federico shall be exempt from liability to third persons. At the end of three years, the assets of the
partnership have dwindled to P220,000.00 while its liabilities to third persons have a balance of
P340,000.00. How much ultimately will be the share of each partner after payment to third persons and
the settlement among the partners?

a. P30,000.00 for each partner

b. Federico, P60,000.00; Alberto P24,000.00 Sofronio, P36,000.00; and Teodoro, none.

c. Federico, none; Alberto P48,000.00; Sofronio, P72,000.00; and Teodoro, none.

d. Federico, none; Alberto, Sofronio and Teodoro, P40,000.00 each.

51. John Solanda and Sons is a partnership composed of three partners, namely: Robert Solanda, Simon
Solanda, and Theodore Solanda. The partners are the sons of John Solanda who has retired from
business but who suggested that they include his name in the firm to give them an advantage since he is
well-known in the business community.
I. John Solanda shall have all the rights of a general partner

II. John Solanda shall have all the liabilities of a general partner

Based on the following facts:

a. Both statements are true

b. Both statements are false
c. Statement I is true; Statement II is false
d. Statement I is false; Statement II is true

52. The following partnership contracts were presented to you for evaluation:

I. A partnership engaged in the sale of office supplies with a capital of P100,000.00 into: cash,
P30,000.00, office supplies for sale; P50,000.00 and office equipment, P20,000.00. The agreement is in a
private instrument.

II. A partnership engaged in the lease of office spaces with a capital of P700,000.00 broken down into:
land, P100,000.00; building P500,000.00; cash, P80,000.00; and office equipment, P20,000.00. The
agreement is in a public instrument attached to which is the inventory of the land and the building
signed by partners. The agreement is not recorded with the Securities and Exchange Commission.

III. A partnership engaged in the trading of computer whose name is “Lamont Enterprises, Ltd”. It has a
total capital of P500,000.00 broken down into P100,000.00 cash and computers worth P400,000.00,
contributed by both general and limited partners. The agreement was subscribed and sworn by all the
partners before a notary public but not recorded with the Securities and Exchange Commission.

Based on the foregoing:

a. Each partnership has a seperate juridical personality.

b. I and II have seperate juridical personality.

c. II and III have seperate juridical personality.

d. None of the partnership has a seperate juridical personality.

53. GREAT Company, a partnership engaged in the distribution of generators, is composed of George,
Roland, Edmond, Albert and Troy. George is the managing partner. During the month of April, the
following transactions were entered into by the following partners in behalf of the partnership without
any authority:

I. The sale of a generator by Roland to Juan Torres who was not aware that Roland had no authority.
Juan Torres has paid for the generator which is due for delivery.

II. The purchase of a car by Edmond from Integrid Motors whose owner was not aware of Edmond’s lack
of authority. The car and the price are due for delivery and payment, respectively.
Based on the foregoing, the partnership is bound by:

a. Transaction I only

b. Transaction II only

c. Both transaction I and II

d. Neither transaction I and II.

54. MARK Company, is a partnership engaged in the trading business, with Marquez, Alconcer, Ramos
and Kanapi as partners. Marquez, Alconcer and Ramos are capitalist partners contributing, P100,000.00,
P60,000.00 and P40,000.00, respectively. Kanapi is an industrial partner. The partners have a stipulation
that Marquez shall not be liable for partnership liabilities, After three years of continued losses, the
partnership incurred liabilities of P200,000.00 at which time its assets has dwindled to P140,000.00.
After partnership assets have been exhausted, partnership creditors may go after seperate assets of:

a. all the partners

b. Marquez, Alconcer and Ramos, but not those of Kanapi.

c. Alconcer, Ramos and Kanapi, but not those of Marquez.

d. Alconcer and Ramos only.

55. Sibal, Untalan, Pareño, Eusebio and Rances are partners in SUPER Enterprises whose business is car
painting and repairs. All partners are capitalist partners with Sibal as manager. After five years of
operations, Rances retired from the partnership. Although Sibal was aware of the resignation of Rances,
he still bought 50 gallons of car paint from Masterpaint owned by Marcelo who had been dealing with
SUPER for the past 5 years, and care spare parts from Supremeparts, owned by Salviejo who was
transacting for the first time with SUPER. The dissolution of SUPER was published in the Manila Bulletin
but neither Marcelo nor Salviejo read it. Neither one knew at the time they transacted with Sibal that
the partnership had been dissolved.

a. SUPER is liable to both Masterpaint and Supremeparts

b. SUPER is liable to Masterpaint

c. SUPER is liable to Supremeparts

d. SUPER is not liable to both Masterpaint and Supremeparts

56. TRIUMPH Company, a partnership engaged in the buying and selling of car spare parts, has for its
partners and their respective contributions the following: Tomas, P10,000.00; Ramon P20,000.00;
Ignacio; P30,000.00 Urbano; P40,000.00; Marcos P100,000.00; Pablo, P200,000.00; and Hilario,
P300,000.00. No one was appointed as manager of the partnership. In the course of the operation of the
partnership, Tomas proposed to buy care spare parts from Dominion Motors, but his proposal was
opposed by Ramon. A voting among the partners took place and Ignacio, Urbano and Marcos sided with
Tomas, while Pablo and Hilario sided with Ramon.

a. The group of Tomas, Ignacio, Urbano and Marcos will prevail because they constitute the majority

b. The group of Ramon, Pablo and Hilario will prevail because they own the controlling interest

c. None will prevail because no one was appointed as manager of the partnership

d. The partners will have to appoint a manager in order to resolve the conflict

57. Refer to No. 56. Assuming that when the voting took place. Marcos abstained, Ignacio and Urbano
sided with Tomas, while Pablo and Hilario sided with Ramon.

a. None will prevail because the voting was equal.

b. The group of Ramon, Pablo and Hilario will prevail because they own the controlling interest.

c. None will prevail because no one was appointed as manager of the partnership

d. The partners will have to appoint a manager in order to resolve the conflict.

58. Refer to No. 56. Assume the same facts except that in the articles of partnership, Tomas, Ramon,
Ignacio, Urbano and Marcos were appointed managers. In the course of the operation of the partneship,
Tomas proposed to buy car spare parts from Dominion Motors, but his proposal was opposed by Ramon.
A voting among the managing partners took place and Ignacio and Urbano sided with Tomas, while
Marcos sided with Ramon.

a. The group of Tomas, Ignacio and Urbano will prevail because they constitute the majority of the
managing partners.

b. The group of Ramon and Marcos will prevail because the own the controlling interest among the
managing partners.

c. The conflict will have to be referred to Pablo, and Hilario because they represent the controlling
interest among all the partners

d. The partners will have to agree that all of them must be managers in order to resolve the conflict.

59. Refer to No. 58. Supposing that when the voting among the managing partners took place, Ignacio
sided with Tomas, Urbano abstained, while Marcos sided with Ramon.

a. None will prevail because the voting was equal.

b. The group of Roman and Marcos will prevail because they own the controlling interest among the
managing partners
c. The conflict will have to be referred to Pablo and Hilario because they represent the controlling
interest among all the partners

d. The conflict will have to be referred to an arbiter for its resolution.

60. Donna, Emma, Alma and Rona are partners in DEAR Company with Donna as manager. Tricia owes
DEAR Company P5,500.00 ans Donna, in Donna’s personal capacity, P4,500.00. Tricia’s debt to Donna is
secured by a pledge of her diamond ring. Both debts are already due. Tricia pays P4,500.00 to Donna and
tell her that the same is in payment of her debt to Donna. Donna, thus, issues her personal receipt. a.
The payment of P4,500.00 will be applied proportionately to the two credits: to the partnership credit at
P2,475.00; to Donna’s credit at P2,005.00. This is so because Donna should not place her interest before
that of DEAR Company.

b. The payment of P4,500.00 will be applied entirely to Donna’s credit.

c. The payment will be applied in partial payment of the partnership credit of P5,500.00; hence there
will be a balance of P1,000.00

d. Tricia, Donna and DEAR Company will have to agree as to which credit the payment shall apply.

61. Which of the following statements concerning the name of a partnership is false?

a. The partnership name may includr the name of only one of the partners.

b. The partnership name may include the names of two or more, but not all of the partners.

c. The partnership name may include the names of all the partners.

d. The partnership cannot adopt a name which does not include the name of at least once of the
partners.

62. Ornussa, the owner of a vacant lot, leased the name to Florida under an agreement that the rental
shall be paid by Florida at the rate of 10% of the annual net income of the flowers business that she
would put up on the lot. A private agreement was signed by the parties. In the first year of operations,
Ornussa received from Florida the amount of P20,000.00 representing 10% of the net income of the
flower shop business.

a. Ornussa is a partner of Florida by mere receipt of the share of the net profits of the flower business of
Florida.

b. The relationship of Ornussa and Florida is only that of a lessor and leasee.

c. Ornussa and Florida have a dual contract partnership and lease.

d. Ornussa and Florida are not partners neither are they lessor and leasee because their agreement was
not in a public instrument.
 63. LIFE Company, a partnership engaged in the water distribution business is composed of partners
Larredo, Ingles, Filler and Encanto. One day, Larredo was driving the firms delivery truck beyond the
speed limit in order to serve its customers, when he rammed into and caused extensive damage on the
parked car of Tertullo.

a. Only Larredo can be held liable for damages by Tertullo

b. LIFE Company and Larredo are solidarily liable for damages to Tertullo.

c. LIFE Company and the four partners are solidlarily liable fot damages to Tertullo.

d. LIFE Company and the four partners are jointly liable for damages to Tertullo.

64. A person admitted as a partner into an existing partnership shall be liable up to the extent of his
separate assets for what obligations?

a. Obligations of the partnership existing at the time of his admission only if there was a stipulation

b. Obligations of the partnership incurred after his admission on if there was a stipulation

c. Obligations of the partnership incurred before and after his admission even of there was no stipulation

d. Obligations of the partnership incurred before his admission if there was stipulation, and those
incurred after his admission even if there was no stipulation.

65. PARAGON Enterprises, a partnership engaged in the garments manufacturing business, is composed
of partners Pacis, Ramas and Gonzales. During the year, PARAGON bought a computerized embroidering
machine amounting to P300,000.00 from Tadena with the following stipulation: down payment of
P50,000.00; balance to be paid in amount equal to 20% of the monthly net profits of PARAGON until the
full amount is paid.

a. Tadena is an actual partner of Pacis, Ramas and Gonzales during the time that he receives a share of
profits of PARAGON as payment of the purchase price of the machine.

b. Tadena is only a partner by estoppel of Pacis, Ramas and Gonzales during the time that he receives a
share of the profits of PARAGON as payment of the purchase price of the machine.

c. Tadena is not a partner of Pacis, Ramas and Gonzales whether before or after he has received the full
payment of the purchase price of the machine from PARAGON.

d. Tadena is only a nominal partner of Pacis, Ramas and Gonzales during the time that he receives a
share of profits of PARAGON as payment of the purchase price of the machine.

66. MAGIC Company, is a partnership composed of Martha, Agnes, Glenda, Irene and Candice, with
Martha as manager who is authorized to collect the credits of the partnership. Theresa owes Martha
P4,000.00 which is due on December 10. She also owes MAGIC Company P6,000.00 which is due on
December 20. On December 15, Theresa tendered payment in the amount of P4,000.00 to Martha in
payment of her debt to the latter. Martha issued her own receipt acknowledging the payment.

a. The payment will be applied proportionately to the credits of MAGIC and Martha in the amount of
P1,600.00 and P2,400.00, respectively.

b. The payment will be applied in its entirety to Martha’s credit.

c. The payment will be applied in its entirety to MAGIC’s credit

d. The payment will be applied equally to the two debts of Theresa.

67. Aseron, the managing partner of ACE Company, was driving the delivery truck of the firm when he
rammed it into an electric post resulting in damages to the vehicle amounting to P50,000.00. To make up
for the accident, Aseron worked long hours for the firm and was able to increase its sales from
P5,000,000.00 to P15,000,000.00.

a. Aseron will no longer be liable for damages to ACE because he was able to generate unusual revenues
for the firm through his extraordinary efforts.

b. Aseron will still be liable to the firm for damages but the amount will be equitably reduced since he
was able to generate unusual profits for the firm through his extraordinary efforts.

c. Aseron’s obligation to the firm for damages will be extinguished by compensation since ACE is also
liable to him for the extraordinary efforts he exerted to increase its sales.

d. Aseron and ACE will share equally in the damages of P50,000.00

68. Trevor owes P3,000.00 to CHAMP Company, a partnership composed of Charles, Harry, Albert, Mark
and Prince, with Mark as the manager who is authorized to collect all credits of the firm. He also owes
Charles the amount of P6,000.00. Both debts are already due. Trevor gives P3,000.00 to Charles in
payment of his debt to the latter. Charles thus issues his own receipt.

a. Payment will be applied proportionately to the two credits at P1,000.00 for Charles’ credit and
P2,000.00 for CHAMP’s credit.

b. Payment will be applied equally to the two credits

c. Payment will be applied in its entirely to Charles’ credit

d. Payment will be applied in its entirely to CHAMP’s credit

69. Barranda wrote Salvador a letter wherein he placed an order for a laptop computer worth
P80,000.00. In writing the letter, Barranda used a stationery which had for its letterhead “Barranda and
Bermudez, Real Estate Agents” Bermudez is not really a partner of Barranda but they, agreed to use the
said letterhead to give a semblance of bigness by making it appear that the two of them are partners.
Salvador delivered the laptop computer but Barrranda defaulted in his payment of its price. Against
whom may Salvador proceed?

a. Barranda only since Bermudez is not his partner.

b. Barranda only since the purchase of the laptop computer is his personal transaction

c. Barranda and Bermudez since they are partners in so far as Salvador is concerned.

d. ‘Barranda and Bermudez, Real Estate Brokers” only since an actual partnership was created between
Barranda and Bermudez and it has a personality separate and distinct from the two.

70. Daoang and Depante have been partners for more than 5 years in the purified water business. At the
start of the sixth year, Daoang assigned his interest in the partnership to Trindad, but Depante objected
on the ground that he did not want Trinidad to be his partner.

a. Trinidad automatically became a partner of Depante when Daoang conveyed his interest to him

b. Daoang and Depante continue to be partners despite Daoang’s conveyance of his interest to Trinidad.

c. The partnership between Daoang and Depante was automatically dissolved when Daoang conveyed
his interest to Trinidad.

d. The conveyance by Daoang of his interest in the partnership to Trinidad entitled the latter to inspect
the books, and participate in the management, of the partnership.

71. Palacios, Atienza, Tablante, Elamparo, Robledo, Ocampo and Sajenes are partners in PATEROS Poultry
Farms. Palacios, Atienza and Tablante have been appointed as managers of the firm with the stipulation
that none shall act without the consent of the other two. On the date of the scheduled delivery of 500
kilos of frozen dressed chickens ordered by Caintacky Restaurant, heavy rains caused a power failure and
made transport difficult due to landslides. A local resident offered to purchase the dressed chickens
(which where already thawing) at 80% of the contract price. However, only Palacios and Atienza were
around to decide as Tablante who was on business trip for the firm, could not be contracted due to poor
communication signals.

a. Palacios and Atienza cannot decide by themselves because the managing partners must act with
unanimity.

b. Palacios and Atienza may decide by themselves since any further delay would result in more losses to
the firm.

c. Palacios and Atienza can decide by themselves since they constitute the majority among the managing
partners, which is the required vote notwithstanding a stipulation that one cannot act without the
consent of the other managers.

d. The absence of Tablante cannot be alleged since there was a stipulation that none of the managing
partners shall act without the consent of the others.
72. Querubin, Roces and Solis are partners in a law firm. Querubin was appointed as judge of the
Regional Trial Court. Such appointment:

a. suspends the participation of Querubin in the management of the firm without causing the dissolution
of partnership.

b. prohibits the inclusion of the name of Querubin in the firm name without dissolving the partnership.

c. results in the dissolution of the partnership.

d. merely requires the disclosure of Querubin’s appointment to the court without dissolving the
partnership.

73. Braganza, Ortiz and Nevado want to form a partnership with Braganza contributing P500,000.00;
Ortiz, office equipment; and Nevado, his services. If the three were to form a limited partnership, who
among them will be the limited partner/s?

a. Either Braganza or Ortiz or both of them

b. Either Ortiz or Nevado or both of them

c. Either Braganza or Nevado or both of them

d. All the three must be limited partners

74. Refer to the preceding number. Assume that the three decide to form a general partnership. As a
result, which of the following is incorrect?

a. Any of the three may be appointed as manager

b. All of them may be appointed as managers

c. Only Nevado may be appointed as manager because he only contributes his services

d. Any two of them may be appointed as managers

75. CROWN Enterprises is composed of partners Chuck who contributed P50,000.00; Rainier,
P20,000.00; Oscar P40,000.00; Waldorf, P10,000.00; and Nelson, P5,000.00. No one was appointed as
manager. Two proposed contracts were voted upon by the partners during a meeting which took place
as follows:

Contract I- Voting for approval of the contract were Chuck and Rainier; voting for rejection were Oscar,
Waldorf and Nelson

Contract II- Voting for approval of the contract were Chuck and Rainier; voting for rejection were Oscar
and Waldorf; Nelson abstained.

a. Both contracts
 b. Neither of two contracts
c. Contract I only
d. Contract II only

76. MACK;s Restaurant is a partnership composed of Manalo, Alferez, Cancio and Kilayco, with Manalo as
the manager whose contribution is 80% of the firms capital. Manalo made Ongpauco his associate by
assigning one-half of his share in the firm to the latter. Did Ongpauco become a partner in the firm?

a. Yes, because Manalo is the manager

b. No, because the other partners must give their consent in order that Ongpauco may be admitted to
the partnership.

c. Yes, because the assignment by Manalo of his share in the firm did not affect his ownership of the
controlling interest.

d. No, because the assignment by Manalo of his share in the firm diminished his interest in the
partnership

77. A partner, is a co-owner with his partners of specific partnership property. Such co-ownership:

a. allows a partner to assign his right in such property

b. allows a partner to use such property for partnership purposes

c. entitles the spouse, children and other relatives of the partner to claim support from such property.

d. gives the private creditors of a partner to attach his right in such property.

78. CLEAN Laundry Services Company is a partnership composed of Carpio, Legaspi, Encinas, Almate and
Noval. Without the knowledge of the other partners. Carpio used a coat brought to the shop by a
customer for dry-cleaning in a party he attended. The coat was accidentally attained with food sauce
during the said party. Who will be liable in the customer for damages?

a. Carpio only since he used the coat without the knowledge of the other partners

b. CLEAN Laundry Services Company and Carpio solidarily

c. CLEAN Laundry Services Company and all the partners jointly

d. CLEAN Laundry Services Company and all the partners solidarily

79. A limited partners is prohibited on account of his claim against the partnership from performing the
following acts, except:

a. To receive or hold as collateral security any partnership property

b. To receive from a general partner or the partnership any payment, conveyance or release from
liability, If partnership assets are not sufficient to discharge partnership liabilities to outside creditors.

c. Transact business with the partnership

d. None of the foregoing

80. Lazarte, a limited partner in Bellevue Company, Ltd., received the amount of P100,000.00
representing his contribution which was being returned on the date stipulated in the certificate.
Partnership records, however, showed that the firm had liabilities of P220,000.00 which arose before
Lazarte received the return of his contribution, and assets of only P90,000.00 after such return of
contribution.

a. Lazarte is bound to bring back in the partnership the amount of P100,000.00 plus interest thereon.

b. Lazarte is bound to give the partnership P220,000.00 plus interest thereon.

c. Lazarte is bound to give the partnership P130,000.00 plus interest.

d. Lazarte is not bound to return to the partnership any amount because he received all the return of his
contribution pursuant to a contractual stipulation.