I. Any application of the doctrine of piercing the corporate veil should be done with caution.

II. A corporation has its powers through its board of directors and/or its duly authorize officers and agents.

• Only I is true

• Only II is true

• Both are true (correct answer, your response)

• Both are false

A corporation consisting of only one member for the purpose of administering and managing, as trustee, the affairs,
property and

temporalities of any religious denomination, sect or church.

• Open corporation

• Close corporation

• Corporation aggregate

• Corporation sole (correct answer, your response)

The amendment of the articles of incorporation, requires merely that

I. The amendment is not contrary to any provision or requirement under the Corporation Code.

II. It is for a legitimate purpose.

• Only I is true

• Only II is true

• Both are true (correct answer, your response)

• Both are false

Are shares of stock which have been issued and fully paid for, but subsequently reacquired by the issuing corporation by

purchase, redemption, donation or through some lawful means.

• Treasury stock (correct answer, your response)

• Redeemable stock

• Convertible share

• Founder’s share

I. The provisions governing stock corporation, when pertinent, shall be applicable to non-stock corporations.

II. A non-stock corporation must have shareholders.

• Only I is true (correct answer, your response)

• Only II is true

• Both are true

• Both are false

The continuation of a corporation’s legal status despite changes in ownership or management.

• Succession (correct answer, your response)

• Inheritance

• Dissolution

• Liquidation

This is the maximum amount fixed in the articles of incorporation that may be subscribed and paid by the stockholders of
the

corporation.

• Outstanding capital stock

• Paid-up capital stock

• Authorized capital stock (correct answer, your response)

• None of the above

A written contract to purchase newly issued shares of stock.

• Sales contract

• Redemption contract

• Purchase contract

• Subscription (correct answer, your response)

I. Property acquired by a corporation is the property of stockholders or members.

II. A corporation exercises said powers through its board of directors and/or its duly authorized officers and agents.

• Only I is true

• Only II is true (correct answer, your response)

• Both are true

• Both are false

Each share shall be equal in all respects to every other share except as otherwise provided in the articles of incorporation
and

stated in the certificate of stock.

• Doctrine of indivisibility of shares

• Doctrine of divisibility of shares

• Doctrine of equality of shares (correct answer, your response)

• Doctrine of corporate opportunity

Subscription to the capital stock of a corporation constitute a fund to which the creditors have a right to look for the
satisfaction of

their claims.

• Trust fund doctrine (correct answer, your response)

• Doctrine of indivisibility

• Doctrine of corporate opportunity

• None of the above

The following are limitations on no par value shares, except:

a. It can be issued for a consideration of at least P3.00.

b. It is deemed fully paid and non-assessable.

c. The entire consideration for its issuance constitutes capital so that no part of it

should be distributed as dividends.

d. It cannot be issued as preferred shares.

Is one where no part of its income is distributable as dividends to its members, trustees, or officers.

• Non-stock corporations (correct answer, your response)

• Stock corporations

• Corporation aggregate

• Corporation by prescription

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.

• Only I is true (correct answer, your response)

• Only II is true

• Both are true

• Both are false

A corporation consisting of more than one member.

• Open corporation

• Close corporation

• Corporation aggregate (correct answer, your response)

• Corporation sole

A corporation created in strict or substantial conformity with the mandatory statutory requirements for its incorporation and
the

right of which to its exist as a corporation cannot be successfully attacked or questioned by any party even in a direct
proceeding

for that purpose by the State.

• Government-owned or controlled corporation

• Quasi-public corporation

• De jure corporation (correct answer, your response)

• De facto corporation

I. Only a natural person, trust, or an estate may form a One Person Corporation.

II. Banks and quasi-banks, preneed, trust, insurance, public and publicly-listed companies, and non-chartered government
owned

and Corporations. controlled corporations may not incorporate as One Person Corporation

• Only I is true

• Only II is true

• Both are true (correct answer, your response)

• Both are false

One which has exercised corporate powers for an indefinite period without interference on the part of the government.

• Foreign corporation

• Domestic corporation

• Corporation by prescription (correct answer, your response)

• Corporation by estoppel

Is one which entitles the holder thereof to certain preferences over the holders of common stock.

• Common stock

• Preferred stock (correct answer, your response)

• Treasury stock

• Watered stock

All persons who assume to act as a corporation knowing it to be without authority to do so shall be liable as general
partners for all

debts, liabilities and damages incurred or arising as a result thereof.

• Foreign corporation

• Domestic corporation

• Corporation by prescription
• Corporation by estoppel (correct answer, your response)

Shares with a value fixed in the articles of incorporation and the certificate of stock.

a. Par value stock

b. No par value stock

c. Redeemable stock

d. Class A stock

A class of stock entitling the holder to vote on corporate matters, to receive dividends

after other claims and dividends have been paid (especially to preferred shareholders),

and to share in assets upon liquidation.

a. Common stock

b. Preferred stock

c. Treasury stock

d. Watered Stock

I. Corporation by estoppel is founded on principles of equity and is designed to prevent injustice and unfairness.

II. Consolidation becomes effective not upon mere agreement of the members but only upon issuance of the certificate of

consolidation by the SEC.

• Only I is true

• Only II is true

• Both are true (correct answer, your response)

• Both are false

Are shares usually preferred, which by their terms are redeemable at a fixed date, or at the option of their issuing
corporation, or

the stockholder, or both at a certain redemption price.

• Over-issued stock

• Redeemable share (correct answer, your response)

• Convertible share

• Founder’s share

I. It is the certificate of incorporation that gives juridical personality to a corporation and places it under the jurisdiction of
the

Securities and Exchange Commission.

II. A corporation commences its corporate existence and juridical personality and is deemed incorporated from the date
the DTI

issues certificate of incorporation under its official seal.

• Only I is true (correct answer, your response)

• Only II is true

• Both are true

• Both are false

They may be purchased or taken up by the corporation upon the expiration of a fixed period, regardless of the existence
of
unrestricted retained earnings in the books of the corporation, and upon such other terms and conditions must also be
stated in

the certificate of stock representing said shares.

• Par value stock

• No par value stock

• Redeemable stock (correct answer, your response)

• Class A stock

Is that portion of the authorized capital stock which has been both subscribed and paid.

• Authorized capital stock

• Unissued capital

• Paid-up capital (correct answer, your response)

• Outstanding capital

. Stocks issued for a consideration less than the par or issued price thereof or in any other

form other than cash valued in excess of its fair value.

a. Preferred stock

b. Watered stock

c. Optional share

d. Founders' share

I. An unincorporated association, which represented itself to be a corporation, will be stopped from denying its corporate
capacity

in a suit against it by a third person who relied in good faith on such representation.

II. A third party who, knowing an association to be unincorporated, nonetheless treated it as a corporation and received
benefits

from it, may be barred from denying its corporate existence in a suit brought against the alleged corporation.

• Only I is true

• Only II is true

• Both are true (correct answer, your response)

• Both are false

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.

• Only I is true (correct answer, your response)

• Only II is true

• Both are true

• Both are false

I. The filing of articles of incorporation and the issuance of the certificate of incorporation are essential for the existence of
a de facto corporation.

II. An organization not registered with the SEC cannot be considered a corporation in any concept, not even as a
corporation de

facto.

• Only I is true
• Only II is true

• Both are true (correct answer, your response)

• Both are false

The factors for the application of the doctrine of piercing the corporate veil are the following, except:

• Stock ownership by one or common ownership of both corporations.

• Identity of directors and officers.

• The manner of keeping corporate books and records.

• Identity of the stockholders. (correct answer, your response)

The due incorporation of any corporation claiming in good faith to be a corporation, and its right to exercise corporate
powers,

shall not be inquired into collaterally in any private suit to which such corporation may be a party.

• Government-owned or controlled corporation

• Quasi-public corporation

• De jure corporation

• De facto corporation (correct answer, your response)

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 partnerships or associations organized for the purpose
of

practicing a profession, shall not be allowed to organize as a corporation.

• Only I is true

• Only II is true

• Both are true (correct answer, your response)

• Both are false

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.

• Only I is true (correct answer, your response)

• Only II is true

• Both are true

• Both are false

It refers to any agency organized as a stock or non-stock corporation, vested with functions relating to public needs
whether

governmental or proprietary in nature, and owned by the Government directly or through its instrumentalities either wholly,
or,

where applicable as in the case of stock corporations, to the extent of at least 51per cent of its capital stock.

• Private corporation

• Closed corporation

• Government-owned or controlled corporation (correct answer, your response)

• Local government units