Partnership Quizzer
Partnership Quizzer
Partnership Quizzer
TEST I - MULTIPLE CHOICE. Select the best answer by writing the letter of your choice.
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
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. P10,000.00.
c. P3,000.00.
d. P3Q,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 acquire 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 had a four-
door apartment which he inherited from his father 3 years earlier. Edward, on the other hand, had a fishpond which he acquired by
dacion en papo 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 the 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 James won
PI,000,000.00 in the lotto. During the same period, rentals of PI20,000.00 were collected from the apartment, while fare revenues of
P200,000.00 were realized from the operation of the fleet of taxis. Which oi the following belongs to the partnership?
a. Two-door apartment.
b. Lotto winnings of PI ,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-estoppel.
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 John,
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?
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a. Managing partner.
b. Liquidating partner.
c. Ostensible partner. '
d. Partner by estoppel.
11. Refer to No. 10. Assuming that JAW Enterprises unable to pay the loan on due date at which time the assets of the partnership
amounted only to PI20.000.00. 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 PI20,000.00; thereafter John, Albert and Wilfred from their separate property at PI0,000.00
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 PI50,000.00. From whom may Moret Sales Co. collect the sum of PI80.000.00?
a. The partnership for its assets of PI50,000.00; 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 PI50,000.00; 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 who 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 PI0,000.00, 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, P2.000.00; 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.
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 ir. good faith.
IV. He may perform all acts of administration in good faith but opposing partners may resort to his removal if he persists.
19. Campos, Urbano, Tamesis and Encanto are partners in CUTE Company each one contributing P300.Q00.00 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 PI00,000.00 each except
Campos who was exempted from liability to third persons by agreement.
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b. From the partnership assets of P200.000.00; thereafter, from the partners for their' separate assets at P
100,000.00 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 PI50,000.00 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 P4,5Q0.00 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 PI,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 caused 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 purpose.
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 for 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 statements 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.
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 earned 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 pn 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.
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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 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 foi 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.
35. A limited partner shall be liable as general partner in three of the following cases. Which one is the exception?
a. When 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 omissions 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 III.
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 contiibutions.
V. Those owing to general * partners in respect of capital.
VI. Those owing to general partners in respect of profits.
a. II, III, IV, V, VI.
b. 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.
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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. Is created by 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
statements 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 a general partnership?
a. Death of a partner.
b. Insolvency of 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 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, atll 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, P36,000.00; 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 aro 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 on secured and
are already due. Diana pays 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 PI,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 P500,000.00, 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.
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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 geners. partner.
II. John Solanda shall have all the liabilities of a general partner.
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 PI00,000.00 broken down into: cash, P30,000.00; office
supplies for sale P50,000.00; and office equipment, P20,000 The agreement is in a private instrument.
II. A partnership engaged in the lease of offices 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 the partners. The agreement is not recorded with the Securities and
Exchange Commission.
III. A partnership engaged in the trading of computers 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 to by all the partners before a notary public but not recorded with the Securities and
Exchange Commission.
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 Tories 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 Intrepid Motors whose owner was not aware of Edmond’s lack of authority. The car
and the price are due for delivery and payment, respectively.
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 P 100,000.00, 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 had dwindled to P140.000.00. After
partnership assets have been, exhausted, partnership creditors may go after the separate 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, Pareno, Eusebio, and Ranees 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, Ranees resigned from the partnership. Although
Sibal was aware of the resignation of Ranees, 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 car 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 only.
c. SUPER is liable to Supremeparts only.
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,
PI00,000.00; 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 car 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.
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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 partnership, 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 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 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 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 Ramon 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
and 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 tells 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 P2,025.00. 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’a 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 PI,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 include 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 one of the partners.
62. Omussa, the owner of a vacant lot, leased the same 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 flower business that she would put up on the lot. A private agreement was signed by the
parties. In the first year of operations, Omussa received from Florida the amount of P20,000.00 representing 10% of the net income
of the flower shop business.
a. Omussa is a partner of Florida by her mere receipt of the share of the net profits of the flower business of Florida.
b. The relationship of Omussa and Florida is only that of a lessor and lessee.
c. Omussa and Florida have a dual contract: partnership and lease.
d. Omussa and Florida are not partners; neither are they lessor and lessee 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 firm’s 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 solidarity liable for damages to Tertullo.
c. LIFE Company and the four partners are solidarity liable for damages to Tertullo.
d. LIFE Company and the four partners are jointly liable for damages to Tertullo.
64. A person admitted as a partner id to ah 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 only if there was a stipulation.
c. Obligations of the partnership incurred before and after his admission even if there was no stipulation.
d. Obligations of the partnership incurred before his admission if there was a 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 the 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 alter 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 the 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 PI,600.00 and P2,400.00,
respectively.
b. The payment will be applied in its entirety to Martha’s credit.
c. The payment will pe 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 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.
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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 PI,000.00 for Charles’ credit and PP2,000.00 for CHAMP’S credit.
b. Payment will be applied equally to the two credits.
c. Payment will be applied in its entirety to Charles’ credit.
d. Payment will be applied in its entirety 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 Barranda 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 ana 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 Trinidad, 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 Daodng’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.
TEST II - MATCHING TYPE. Indicate your answers by writing the letter representing the statement or phrase that best describes,
defines or explains the numbered items.
Terms
Statements
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TEST III - TRUE OR FALSE. Write the word “TRUE” if the statement is true, and the word “FALSE” if the statement is false.
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