aw CPAR CPA Review Schoo! of the Philippines FINAL PRE-BOARD EXAMINATION Regulatory Framework for Business Transactions Instractions:Choose the BEST answer for each of the following items. ‘Mark only one answer for each item on ‘the Special Answer Sheet provided. Strictly no erasure allowed. 1 {A leased a‘Pircel of land t0.B Tora period of two years. ‘The lease contract did not contain any express rohibition against the assignment ofthe leasehold or the subleasing ofthe leased prema During the third rohit a sublease he ant. nc, C without A's consent signed the sublease 19D. is the status of: L__ B'ssublease to C UL C’sassignment to D F ‘a Tand arevalid. Landi are void ¢. Only is valid. d. Only Tis valid 2. A,B,C and D organized a genera artvership with A and Bas industrial partners and C and D as capil Fartners C contributed Php 200,000 and D contributed Php 100,000 to the common find By a unanimous Ci rarer ncpaatcr A and B were appointed es nanaging partners witout any specification of thei respi powers and dues. Later, W applied fr the position of secretary and Y applied Tor the position of accountant of the partnership. Te rinwe of W was docled upon by A and B bu wa opposed by Cand D, The hinng of ( Wovas decided by A and D but was opposed by B and C. Who can be hired by the partnership? ‘2 Both Wand Yb. Neither Wnor Y (¢/Only W /4. Only Y ~ BD ‘A, upon request, loaned his passenger jeepney to B to enable B to bring his sick wife from PB City to No ee ea eels for teatnent On the way back to Legaspi, after leaving his wife atthe hospi, people Hopped the passenger jeepney. B stopped for them and allowed them to ride on board seer Pic# payment from them just asin the case of ordinary passenger jecpney plying their route. As B was crossing Guinobatan, there was an onrush of lahar from Mount Mayon ‘The jeep that was loaned to him was destroyed. Which of Dp, the following is not correct? BY ‘2. The contract between A and B is called commodatum b. Bis obliged to pay A for the use of the passenger jeepney w c. Bis liable for the loss of the jeepney 4. Acan recover from B the value of the jeepney and payment for the use of the jeepney business with the (9 Question A ~ Can @ husband and wife form a limited partnership to engage in real estate wife being a limited partner? Question B - Can two corporations organize e general pastnership? t c. Yes only to Question A ‘a. Yes to both questions p Noto both questions d. Yes only to Question 8 Spouses A and B borrowed money from a local merckant. To guarantee the payment, they left the Torrens title of their land with the merchant for hint to hold enti they pay the loan There is contract of 7, ‘a Pledge b. Mortgage, c. Antichresis ¢. Simple loan © The following are examples of real comacts, except ce ® Commodsrum b, Mutuum ¢. Donation d. Pledge 7. A Band C are general pestuers in a merchandising firm. They contributed amounts to the capital und s1s0 eed on equal distribution of whatever net profit realized per fiscal period. After thee years of operation, parever C vonveys her whole inferest inthe partership to D, without the knowledge and consent of A and B. Which of the following is not.correct? ‘a. The partnership is dissolved. )o b b D cnet intr prpat he mast or adnan of te prc PRES 13 D shall receive the nex profits to which C would have otherwise been entitled ‘The conveyance by C of his whole interest in the pertnershup did not make D a partnerhid oy (areal —“ oe of the following obligationss not valid? \ caged) ‘a If the debtor promises to pay a'Soon as she has the micans to pay / (¢¥ °° —b. If the debtor will give his car if the creditor will pass the CPA Exam and if the creditor will fail, the creditor will have sexual jurse with the debtor for one week. Pt tah Core D Ifthe debtor will give his cow or will kill the friend of the creditor ~ al feyreks ~ °| Tan XG. Ifthe debtor will be the ma xeditor or ifthe debtor wants will grve Php 1M to the FERS (deeok aE eS en 9, Af a pregnant woman passenger of a bus were to suffer an abortion following a vehichiar accident 73038, ¢ of the bus driver, she and her husband can claim as damages from the bus company for the death of their unborn child, except ‘2. Actual damages in the form of imdemnity for the loss of life of the unbotn child b. Moral damages for mental anguish that attended the loss of the unborn child K c. Exemplary damages since there is gross negligence 4. Actual damages for the bodily injury she suffered from the loss of the fetus which is considered part of her internal organs. was fe (ten __ grant parte (0) 16-year old high school student stabs his classmate who is his rival for a girl while they were going out of the classroom after their last class, under the law on quasi delict. Which of the following is not correct? 1- The school, its administrators and teachers shall have substituted parental authority and rpsponsibility a ‘over the minor child while under their supervision, instruction or: — Spredt I - The persons identified by law to be liable may raise the defense that they exercised the proper e diligence required under the circumstances, that is they observed the diligence of a good father of a family to prevent the damage. a BothIandil b.NeitherInor!l ¢. Only! d. Only II * UA made a negotiable promissory note payable to the order of B, a minor. Later, B indorsed the note to C, then C to D and D to E. Which of the following is correct? a. IfE is aware that B is a minor, E cannot collect from A but can collect from D or E b. It Eis aholder in due course, E can collect from A, and if A dishonors by non-payment, E can collect D from B, C or D ©. The indorsement by B 10 C did not make C a bolder Regardless of whether £ isa holder in due course or holder for valye, E can collect from A A= Sgt Bm 12, Kmade a negotiable promissory note payable tothe orde dt B. Late, B mala blank indorsement to Cand delivered the note to D, who likewise delivered the note to E. E made a special indorsement to F and F made a qualified indorsement to G. Which of the following is correct? ‘a. The indorsement made by E is not necessary because the instrument was converted to bearer, hence the indorsement made by G can be stricken out Cand D are not liable because they negotiated the instrument by delivery ¢ If the instrument is dishonored by A, the present holder E cannot go after Cand D B's indorsement can be stricken out because B's blank indorsement converted the istrument to bearer “The holder, at his option may treat the instrument either as a bill of exchange or a promissory note in any of the following, except a. The dfawee is a fictitious person b. The drawee is a petson not having the caracity to contract -D cc. The drawer and the drawee are the same person d._ The drawer and the payze are the same person 7° = i ing statements ie correct?” (% . A older ofa ogotable insect an be ptr «Boer in due course of a holder for value but not both in one instrument ~ b holder for valve deriving hs ttle from a holder in due course can enforce the instrument against \ the maker who has a j°cvonal defense \/ Wh aoe nerf one to win # negotiable instrument payable to order was delivered Thaler for value ©. d. Aholder in due course 1s alwaysfollowing are the it Tequisites to be a holder in d except Pe Tr ook itn ood faith and forvale. ; ate ‘time it was negotiated to him, he has no knowledge of any infitmity or defect in the ttle : ; Person negotiating it ; O e ‘That itis complete and regular ‘upon its face when issued by the maker tothe payee ee 4. That he became ahoder of ible twas overdue tnd witout nce tht had een previously i aw if such was the fact ‘ \ 4 (28° poison aoe eds: ‘ v | Dromise to pay B or bearer P20,000. Sgd. A.” Tx fdews | Pac iiered the note to C C indorsed the note to D. Then Y stole the note from D and indorsed the note to B. ivered the note to F. AS a result 8. IFA pays F in good faith, A’s obligation is extinguished c. F cannot be a holder in due course iA . F can collect from D or B dF can go after indorsers C and Y, i i ~~ 17 A promissory note reads: # “Ipromise to pay B or order P20,000. Sed. A” ¥ B made @ special indorsement to C and C made a conditional indorsement to D. Ifthe condition is not yet fulfilled, which of the following is correct? Log i ® a IFA dishonors the note, D can collect from B or C : b. IfA pays D, A’s obligation is extinguished z (* _ &- IEA pays, A becomes liable if D fails to fulill the condition Coxe i \ 4. IFA dishonors the note D can collect from B but not from C m + ( 184M issued a negotiable instrument payable to P or bearer. P indorsed ond delivered the instrument to A, who \ indorsed and delivered the note to B. Later, Btelivered the note to C, and C indorsed the note to D and D a indorsed the same to E, the present holder. Which is not correct?” a Pand A are liable as general indorsers but their secondary liability do not extend to E b. Cand D are secondarily liable toE . c ¢. IfM dishonors the note, E can collect from any of the’ general indorsers The title of E cannot be traced to the indorsement of P and A (AD. A negotiable instrument is not discharged ‘a By payment in due course by the party accommodated, where the instrument is made or accepted for his accommodation b. When the principal debtor becomes the holder of the instrument ator after maturity in his own right > cc. By payment in due course by ot on behalf of the principal debtor 4. By intentional cancelation thereof by the fpdoragy 20, Which of the following statements is false? a. When a bill is dishonored by the acceptor for honor, it must be protested for such dishonor b. A drawee who accepts two parts ofa bill in set may’be liable to the holders of both ee ©. Acceptance for honor may be made by the drawer j Payment for honor can be made only if there was prior protest for non-payment » 21, The sum is not certain, if it is to be paid : © With intrest", In installments, ¢ With exchange 4.) D. Wi attorney's fess! Mek AG ok ROR . 23 Consider these two instruments: | foam) dak we aoe L_ “promise to pay B or order P10,000, 30 days after date”. Sgd. A. Kk IL “Pay to the order of B 10,000, 30 days after sight”. Sgd A / & Only Tis neggsiable Only lis negotiable c. Both are negotiable. Both are non-negatiable 24. Missues a negotiable promissory note payable to P or bearer. Ifthe note i indorsed by Pto A and A negotiates the note by delivery to B. Which of the followings correct? Misnot liable to B ‘6B can collect from either P or A {> Pistiableto A and B (APistinble toa ret