1.

(1) A foreign corporation doing business in the Philippines without a license may be
sued but it cannot sue.
(2) A written demand for payment of the fair value of the shares made in the exercise of
the appraisal right will suspend the stockholder’s rights.
Ans: both are true
CH: both are true

2. General rule is that the VTA is for a period of 5 years only, the period can be longer
under the law if?
Ans: Loan Agreement

Section 58 - Voting Trust Agreement (VTA)

GR - good for 5 years
opposite of proxy
E: more than 5 years, provided there is

3. The following are the requisites except one for valid declaration and/ or issuance of stock
dividend.
Ans: It is issued to increase the ACS
CH: It is issued to increase the authorized capital

4. Maximum fine imposable by SEC in case of failure or refusal to comply with lawful order
Ans: 30,000

PROOF : SEC. 157. Contempt. – Any person who, without justifiable cause, fails or
refuses to comply with any lawful order, decision, or subpoena ---- not exceeding
Thirty thousand pesos (P30,000.00).

5. A delinquent corporation shall have the period of __ to resume operations and to comply
with all the requirements that the Commission shall prescribe.
Ans: 2 years
RA 21: 2 years

6. Period to transfer the shares to the heirs of the OPC

Ans: 7 days

PROOF : SEC. 132. Conversion from a One Person Corporation to an Ordinary

Stock Corporation - 7 days - Transfer shares to heirs

7. S1- To elect the officers of the corporation, majority of the directors of the meeting
constituting a quorum is sufficient.
 S2- members of Non-stock corporation may all be without voting rights if provided for in
the articles of incorporation or by-laws.
Ans: Only first is false
(both true)

8. South China airlines is a foreign airline company. South China Airlines tickets are sold in
the Philippines though Philippine Airlines as their general agent. South China Airlines is
not registered to do business as such with the Philippine Securities and Exchange
Commission. Which statement is most accurate?
Ans: South China Airlines can be sued in the Philippine Courts but it cannot sue
CH: South China Airlines can be sued in Philippine Courts but can not sue .

9. Cash dividend as distinguished from stock dividend:

Ans:It does not involve any disbursement

Ans: It is declared only by the Board of Directors

10. S1- OPC is not required to have a minimum capital stock TRUE
S2- OPC is not required to have by-laws TRUE
Ans: Both answers are true
Sagot namin

11. Period to report the election of the officers of the One Person Corporation
Ans: 30 days

: 5 days lang ata to

Proof: SEC. 122. Within fifteen (15) days from the issuance of its certificate of
incorporation, the One Person Corporation shall appoint a treasurer, corporate
secretary, and other officers as it may deem necessary, and notify the
Commission thereof within five (5) days from appointment. The single stockholder
may not be appointed as the corporate secretary.
12. S1- OPC is converted to Ordinary Corporation if the OPC acquires all the shares in the
said Corporation
S2- The period to decide the conversion from OPC to ordinary is 6 months
S3- The single stockholder in the OPC is required to have by-laws (FALSE)
Ans:Only S1 is true

13. A stockholder’s right to inspect books and records of a corporation will be properly
denied if the stockholder
Ans:
CH & Quizlet: Wants to use corporate shareholder records for a personal
business.

14. The right of a corporation to exist as juridical person during its term as stated in the
articles of incorporation despite the death of any of its stockholders is-
Ans: Right of Succession

15. Watered stocks are shares of stock issued by a corporation for a consideration less than
its par or issued value or for a consideration in any form other than cash, valued in
excess of its par value. In this regard -
Ans: the agreement that it shall be paid for less than its par value is illegal and void and
cannot be enforced.

16. Emergency Board is created upon the vote of:

Ans: Unanimous vote of the remaining

17. Period to elect the officers of the One Person Corporation

Ans: 15 days

Proof: SEC.122 Within 15 days from issuance of cert of inc, OPC shall appoint
treasurer, sec, and other officers
18. A subscribed to 100 shares of X corporation paying 25% thereof . Despite the demand
by A for the issuance of stock certificate , the corporation refuses to issue one
corresponding to the 25% paid. Meanwhile , the corporation has become insolvent and A
now refuses to pay his unpaid balance on his subscription. Is the refusal to issue a stock
certificate valid?
Ans:
CH: Valid, because stock certificate can only be issued after full payment of the
subscription

19. A, B, C, D, E, and Filipino citizens, X, Y, Z, American citizens, and R and S Japanese

citizens agreed to form a domestic corporation with an authorized capital stock of
P1,000,000. divided into one hundred thousand (100, 000) shares with a par value of
P10.00 per share . B subscribed for 2, 000 shares and he paid P12,000.00.X subscribed
for 5,000 shares and he issued a promissory note in the amount of P30,000.00 . F joined
the group but he did not subscribe for any number of shares .

Assuming that the corporation has been organized, how many shares can B validly vote
in the election of the members of the board of directors ?
Ans: 2,000 shares because that is his total subscription

20. Who has jurisdiction over party-list organizations?

Ans: COMELEC

21. As regards the corporate by-laws which of the following is false?

Ans: To revoke the power delegated to the board to amend, repeal, or adopt new
by laws, 2/3 of the outstanding capital stock

22. These do not form part of the outstanding capital stock:

Ans: treasury shares
23. First statement: The cost and expenses of appraisal shall be borne by stockholders
Second statement: The board of directors may remove a number of the board of
excessive absences
Ans: Both are false

24. S1- In case of voluntary dissolution and no creditors are affected , at least twenty (20)
days notice prior to the meeting is required.. (TRUE)
S2- Withdrawal of Request and Petition for Dissolution must be filed within 15 days.
(TRUE)
Ans: BOTH TRUE -

25. The following may be the consideration of the shares of stock of a corporation. Which is
the exception?
Ans: promissory note (CH)

26. It is one brought by one or more of the stockholders or members in the name and on
behalf of the corporation to redress wrongs committed against it or to protect or vindicate
corporate rights , whenever the officials of the corporation refuse to sue , or are the ones
to be sued or hold control of the corporation.
Ans: Derivative Suit (malyt)

27. Which of the following is a limitation in proxy?

Ans: . The proxy as a rule is only for the meeting from which it is issued (CH)

28. As a general rule, who has jurisdiction over intra-corporate disputes?

Ans: SEC

Proof: Who has jurisdiction over intra-corporate disputes? The Securities and
Exchange Commission is given original and exclusive jurisdiction to hear and
decide cases involving intra-corporate controversies, as provided under Section
5 of Presidential Decree No. 902-A. (5) Inspection of corporate books
29. Which of the following meetings may be held outside the Philippines?
1. Board of Directors meetings
2. Members meetings of a non-stock corporation
3.The date of the appro Stockholders meeting of a corporation going public
Ans: I only (CH)

30. A, B, C, D, E, and F, Filipino citizens , X , Y , Z American citizens , and R and Japanese

citizens agreed to form a domestic corporation with an authorized capital stock of
P1,000,000. divided into one hundred thousand (100,000 ) shares with a par value of
P10.00 per share . B subscribed for 2,000 shares and he paid P12,000.00 . X
subscribed for 5,000 shares and he issued a promissory note in the amount of
P30,000.00 . Fjoined the group but he did not subscribe for any number of shares . Can
B demand for a certificate of stock of 1,200 shares?
Ans: No, because certificate of stock shall be issued only after payment of the full
amount of the subscription (CH)

31. The date of the approval of the revised corporation code

Ans: february 20, 2019

32. 1st statement- A close corporation may not have more than 15 corporations
2 ^ (nd) statement- No delinquent stock shall be voted for or be entitled to vote through
representation at any stockholders ' meeting
Ans: Only the first is false (CH)

33. Hokkaido , Hakone Ajinamoto , Nissin and Oishi are five Japanese citizens who
organized a corporation in the Philippines and registered in the same in the office of the
Securities and Exchange Commission
ANS:iIt is a domestic corporation

34. The following are Administrative Sanctions imposable by SEC. except:

ANS: MANDAMUS
35. The voting proportion required to enable a corporation to invest its fund in any other
corporation or business or for any purpose other than its primary purpose
Ans: Majority vote of the board of directors and ratified by 2/3 of the outstanding capital
stock;
CH: The majority of the BOD and ratified by ⅔ of the stockholders

36. For the contract between the corporation and its directors, officers or trustees
may not be voidable the following are conditions except:
Ans: Ratification by majority of ocs

37. A is the listed owner of P10,000 shares with par value of P100/share in ABC Corporation
. ABC sued A for the payment of A's indebtedness of P1M . A contends that such debt
must be compensated by his shares of stocks with the plaintiff corporation. The
contention of A is
ANS : Untenable since he is not a creditor of the corporation

38. Which of the following is not an involuntary dissolution of the corporation?

ANS nila: by the vote of the board directors and stockholders, where no creditors

39. The following are non-arbitrable, except:

ANS: Intra-corporate relations

40. 1 ^ (st) statement- Treasury shares may be redeemed regardless of the existence
of unrestricted retained earnings even if such redemption would cause insolvency
or inability of the corporation to meet its debts as they mature
2 ^ (nd) statement- Treasury shares do not revert to the unissued shares of the
corporation and are still issued shares but being in the treasury they have the
status of outstanding
Ans: onlyfirst is false

41. Period for notation of Certificate of STock in case of exercise of Appraisal Right by the
dissenting stockholder under the 4 instances cited under the RCC
ANS
Section 85: 10 days
42. A religious corporation acquired juridical personality from
Ans nila: issuance of the cert

ANS: filing of the articles of incorporation and other documents

43. The appraisal right can be exercised by a stockholder under the conditions provided by
law , which one of the following is the grouf in case of close corporation?
Ans: For any reason (CH)

44. S1- if the foreign corporation merges in it home country and it is the absorbed
corporation, it must file a petition for withdrawal in
SEC. S2 - If the foreign corporation merges in its home country and it is the
absorbed corporation, it must inform the SEC within 6 months.
Ans: ONLY S1 is true

45. AB and Filipino citizens , X, Y, Z , American citizens , and R and S Japanese citizens
agreed to form a domestic corporation with an authorized capital stock of P1,0 divided
into one hundred thousand (100, 000) shares with a par value of P10.00 per share . B
subscribed for 2,000 shares and he paid P12,000.00 . X subscribed for 5.000 shares
and he issued a promissory note in the amount of 30, C joined the group but he did not
subscribed for any number of shares . Can F be an incorporator of the corporation ?
Ans: No, because he does not own atleast one share of the capital stock of the
corporation

46. S1 Contracts between corporations with interlocking directors shall only be

voidable and not void because of the nominal interest of the director .
S2 Management contracts shall be approved by 2/3 vote of the directors and
stockholders of both management and managing corporation .
Ans: Both are false
47. Period to report non -holding of the election of BOD
Ans: 30 days
Proof: Sec.25 Report of Election of Directors, Trustees and Officers, Non-holding
of Election and Cessation from Office.

48. Requirement to effect the amendment of the by-laws of a corporation

Ans: M of BOD + M of OCS

49. The following are the documentary requirements to be submitted by the foreign
corporation, except?
a. Proof that applicant is solvent
b. Resident agent
c. Proof of reciprocity
d. Certificate of compliance
e. Copy of aoi and by laws
Ans: D - certificate of compliance

50. Which of the following statements is correct?

Ans: To enter into management contract, majority vote of the Board of Directors
and majority of the outstanding capital stock or of the members.

51. X Corporation posted a P1M profit in its realty business and its real estate has
appreciated in value to the tune of P4M . The board then declared dividends to its
stockholders computed on the basis of representing profits and appreciation in
value of its real estate . Is the dividend declaration valid ?

Ans nila: Valid, because it was based on profit and increment in the value of the
corp assets

CH: Not valid, dividends must be only from unrestricted retained earnings
52. A stockholder who does not approve the action taken by the Board of Directors in
proposing to amend the articles of incorporation is not allowed to withdraw from
the corporation in one of the following instances
Ans: Merger or consolidation

CH: Creating, incurring, increasing or decreasing bonded indebtedness

53. In this scenario, who shall preside in the meetings?

Ans: Chairman

54. Vote in case of voluntary dissolution with creditors affected

Ans nila: ⅔ of the ocs

Ans: M + ⅔
Sec.135

55. This is a public instrument giving authority to vote for stockholder.

Ans nila: Voting trust certificate

Ans: VOTING TRUST AGREEMENT

56. The regular meeting of the stockholders shall be held when the by-laws are silent:
Ans: After April 15

57. Period of validity for Pre-Incorporation Subscription Contract

Ans: at least 6 months
Section 59
58. The amendments of the Articles of Incorporation shall take effect upon their approval by
the Commission /SEC , or from the date of filing with the SEC if not acted upon within
Ans: 6 months from date of filing
Proof: Sec 15

59. Watered stock is share stock issued by a corporation for a consideration less than its
par or issued value or for a consideration in any form other than cash, valued in excess
of its par value. In this regard
Ans: A. The agreement that it shall be paid less than its par value is illegal and void

60. ST Directors and officers who approve illegal or fraudulent acts or guilty of gross
negligence or bad faith in conducting affairs of the corporation are liable jointly and
severally . S2 In case of issuance of watered stock , only the directors and officers who
approved the same are liable for the "water " to the corporation and creditors but not the
stockholder who received the shares.
Ans:Only the first is true

61. Vote in case of voluntary dissolution with no creditors affected

Ans: M+M

62. ************ A subscribes for 1,000 shares from ABC Corporation at the cost of P30 000
per share . He initially paid 1, 000 . The subscription contract is silent as regards the
payment of the balance . The board of directors issued a call requiring all the
stockholders , with unpaid balance to pay 50 % of the balance on their subscription on or
before September 15 , 2019 as required in the call . Assuming that the amount due to
the corporation is P9,750 and the following are the bids in the delinquency sale , who is
the highest bidder ?
Ans: R - P9,750 for 600 shares
(inaalyze lang based sa cfas)
Ans nila:B 9,750 for 648 shares
63. doctrine of corporate opportunity rests on the unfairness of an officer or director
of a corporation taking advantage of an opportunity for his own personal benefit
adverse to the corporation .
S2 - The by-laws must be filed with the SEC for the corporation to acquire juridical
personality.

Ans: S1 is false

Ans: ONLY S1 is true

64. The following are ways of enforcing payment of unpaid subscription, which is the
exception-

Ans: Denying delinquent stock cash dividends

65. A subscribed to 100 shares of X corporation , paying 25 % thereof . Despite the demand
by A for the issuance of stock certificate , the corporation refuses to issue one
corresponding to the 25 % paid . Meanwhile , the corporation has become insolvent and
A now refuses to pay his unpaid balance on his subscription . Can A validly refuse to pay
the unpaid balance on his subscription now that the corporation has become insolvent?
Ans: Valid, because stock certificate can only be issued after full payment of the
subscription.
(Coursehero)

66. The following are penalties imposable by SEC, except:

Ans:ESCHEAT

67. Which of the following can be a close Insurancorporation?

a. Insurance
b. Banks
c. Mining
d. Building and loans assoc
Ans: D - building and loans
68. Maximum period of validity for Cease and Desist Orders of SEC
Ans nila: A 20 days

69. In case of the Self -Dealing Director , the law requires that in case of corporations vested
with public interest , material contracts are approved by :
Ans:B - ⅔ vote of the entire

Ans:

70. A corporation commences its existence from the issuance of the certificate of
incorporation, which one is the exception?

Ans: Religious corporatio

71. Period for sec to act in case of refusal to inspect by corporation

Ans: (5 days)

72. S1 The merger or consolidations of corporations become effective upon approval by the
constituent corporations of the plan of merger or consolidation as the case may be . S2
After the merger the absorbed corporation must undertake dissolution and winding -up
procedures
Ans: (Both are false)

73. Requirements to effect the amendment of the by-laws of a corporation

Ans: Majority vote of the board of directors and majority vote of the
outstanding capital stock
(Quizlet)

74. In the regular meeting of the stockholder, the notice shall be sent:
Ans: At least 21 days before the meeting

75. S1 - After dissolution but within the three - year period of liquidation a corporation's term
may still be extended by amendment of its articles of incorporation . S2 - The dissolution
 of a corporation shall take place because it has been in continuous non -operation for 2
years .
Ans: S1. False S2. False
(Coursehero)
(bhie padouble check kasi ung sa coursehero nyan 5 years ang given hehe)
( nacheck na same questions sila )
Okiiii thankiesss <3

76. Under the RCC, the effectivity of the Founders’ Shares shall be?
Ans: (5yrs)

77. Vote in corporations vested with the public interest incase of Self-dealing director.
Ans: 2/3 of the BOD and majority of the independent directors
(Coursehero)

78. S1 in an open corporation , only in a certain case do stockholders have appraisal right or
dissenting stockholders while in close corporation stockholders can at any time for
whatever reason demand payment of surrendered shares .

S2 the former , there is no restriction in the transfer of shares while in the latter there is
in the form of the right of first refusal of the corporation or stockholders
Ans: Both are true
(Quizlet)

79. Purely ultra vires acts of the officers of a corporation to invest corporate funds in another
business or corporation , i.e. acts not contrary to law , morals and publics policy may be
ratified by :
Ans: Stockholders holding 2/3 of the voting power
(COursehero)

80. The following are advantages of par value shares of stock , except one :

81. A B C, D E , and F Filipino citizens X, Y, Z American citizens , and Japanese citizens

agreed to form a domestic corporation with an authorized capital stock of P1,000,000.0
divided into one hundred thousand (100, 000) shares with a par value of P10.00 per
share . B subscribed for 2,000 shares and he paid P12,000.00 . X subscribed for 5,000
shares and he issued a promissory note in the amount of P30,000.00 . F joined the
group but he did not subscribed for any number of shares . Is the payment of X for his
subscription valid ?
Ans: No, because shares of stock shall not be issued in exchange of
promissory note
 (Quizlet)

82. S1 In case of shares owned in common by two or more stockholders , the consent of
either is enough to vote the same . S2 The pledgee or mortgagee shall have the right to
vote the share unless stipulated otherwise
Ans: Both are false
(quizlet)

83. An individual or a domestic corporation designated in a written power of attorney , by a

foreign corporation authorized to transact business in the Philippines , on whom any
summons and other legal processes may be served in all actions or other legal
proceeding against such corporation is called
ANS: Resident Agent
Section 144

84. The following are advantages of par value shares of stock, except one:

85. This is characteristic of a stock corporation as distinguished from a non-stock

corporation:
ANS:
86. The following are corporate acts in which a stockholder of a corporation shall have the
right to dissent and demand payment of the fair value of his shares of stock except one-
ANS: in case of merger or consultation
Section 80

87. Which of the following is not a requisite for a close corporation:

ANS: That close corpo does not have a stockholders thereof who own ⅔ of voting
stocks
Source: gut feeling

88. Period for publication of delinquent stock

ANS: 2 weeks
Section 67
 89. The distinction between subscription of shares from purchase of shares is that in
subscription of shares:
ANS: it takes place before or after incorporation and isgenerally paid in
installment or upon a call.
(89 to sa picture)

90. The meetings of the board of directors of a stock corporation may be held
anywhere in the world
S2: The meetings of the members of a non stock corporation may be held
anywhere in the Philippines
ANS:

91. Annual Financial Statement need not need an independent CPA if the total assets or
liabilities is:
Ans; below 600,000

92. Sebastian , one the stockholders of Longan Corp was convinced by Fernando , one of
the directors of said corporation to sell to him (Fernando ) his stockholding for a certain
price . Since the offer was good , Sebastian consented to the sale . Unknown to
Sebastian , at the time of the sale , Fernando was the chief negotiator of Longan Corp.
in selling its substantial property to the government at a price which greatly enhanced
the value of the stock . Under what doctrine is Fernando as director of the corporation
liable ?
ANS: Special fact doctrine

93. In three of the following corporate proposals , a disserting stockholder has the
right to surrender his shares of stock to the corporation and demand for the
payment of their fair market value . Which is the exception ?

94. The by -laws of the non -stock corporation may provide that the meetings of the
members of the non -stock corporation may be held :
ANS: at any place even outside the place where theprincipal office of the corporation is
locatedprovided within the Philippines

95. A corporation becomes delinquent if it fails to submit the report for times , consecutively
or intermittently for a period of years .
 ANS: 3,5 years

96. 1 Directors , as a rule , are entitled to compensation as directors but not

exceeding ten percent of the net income tax of the preceding year .
All private coporations in the Philippines shall be incorporated under the Revised
Corporation Code which is a general
ANS:

97. The number of Board of Trustees in a non -stock corporation :

ANS:: May be more than fifteen upon its organization

98. Period to notify in case of election of Regular Meeting of Stockholders

Ans: AT LEAST 21 days

99. (1 ) Appraisal right means that whenever the capital stock of a corporation is increased
and new shares of stock are issued , the new issue must first be offered to the
stockholders in proportion to their existing shareholdings before subscription are
received from the general public . 2) Ultra vires acts are illegal and therefore void . (3 )
Certificate of incorporation is the document prepared by the persons establishing the
corporation and filed with the SEC containing the matter required by the Corporation
Code
Ans: ALL ARE FALSE

100. Percentage requirement to consider stockholdings substantial if the corporation

intends to sell or substantially all of the corporate assets in pursuance to requirements of
the Revised Corporation Code .