Corporation MCQ (1-10) 1.

A corporation where vacancies in the Board of Directors, are filled only by the remaining members of the Board, is: a. Open corporation; b. Corporation sole; c. Eleemosynary corporation; d. Close corporation ANSWER: D

2. The following, except one, are qualifications of corporate directors: a. Must continuously own at least one share during their term as directors. b. Must own at least one share of stock. c. Ownership of shares must be recorded in the books of the corporation. d. Majority are citizens of the Philippines. ANSWER: D

3. In a corporation, two or more positions may be held concurrently by the same person, except that no one person shall act as: a. President and Chairman of the Board b. Secretary and Treasurer c. Treasurer and Director d. President and Secretary ANSWER: D

4. Which of the following is a disadvantage of forming a corporation? a. The shareholders are not liable for the debts of the business. b. The subservience of minority stockholders to the wishes of the majority subject only to equitable restraints. c. Because of the power of succession, the existence of the entity is not affected by the personal vicissitudes of the individual shareholders. d. The free and ready transferability of ownership. ANSWER: B

5. How many number of votes of the Board of Directors are required to change the name of the corporation? a. 2/3 vote of all the members of the Board b. 2/3 vote of all present c. Majority vote of all present constituting a quorum d. Majority vote of the Board ANSWER: D

6. A private corporation commences to have corporate existence and juridical personality from the date: a. The officers of the corporation are elected by the stockholders. b. The incorporators sign the Articles of Incorporation. c. The Articles of Incorporation and By-laws are presented to the SEC. d. The SEC issues it certificate of incorporation under its seal. ANSWER: D

7. The interest or right of the owner in the corporation's profits or in the net assets of the corporation on dissolution is: a. Dividend b. Share of Stock c. Certificate of Stock d. Capital ANSWER: B

8. Requirement to effect the amendment of the by-laws of a corporation a. Majority vote of the Board of Directors b. Vote of 2/3 of the outstanding capital stock c. Majority vote of the Board of Directors and majority vote of the outstanding capital stock d. Majority vote of the outstanding capital stock ANSWER: C

9. The right of a corporation to exist as a juridical person during its term as stated in its Articles of Incorporation despite the death of any of its stockholders is: a. Right of Existence b. Right of Redemption c. Right of Succession d. Pre-emptive Right ANSWER: C

10. The following person cannot be an incorporator of a corporation: a. A resident alien b. A married woman without the consent of the husband even if the payment of her shares is her paraphernal property c. A subscriber on the shares of the corporation who pays less than 25% of his subscription d. A corporation organized under the laws of the Philippines ANSWER: D

Corporation MCQ (11-20) 11. Which of the following documents may be submitted before or after incorporation? a. Verification certificate as to the name of the corporation b. By-laws c. Certificate of bank deposit as to the paid-up capital d. Articles of Incorporation ANSWER: B

12. A stock corporation, in general, is taxed in the same manner as a. General professional partnership b. Non-general professional partnership c. Sole proprietorship d. Cooperative ANSWER: B

13. Which shares may be issued with or without par value? a. Common shares b. Preferred shares c. Both common and preferred shares d. Neither common nor preferred shares ANSWER: A

14. Who may vote the shares without the need of any written proxy? a. The pledgee of shares of stock b. The mortgagee of shares of stock c. The executor of an estate which owns the shares of stock d. The stockholder who transferred his shares in a voting trust agreement. ANSWER: C

15. In which of the following corporate acts is the appraisal right not available? a. Merger or consolidation b. Extension or shortening of corporate existence c. Sale, lease, exchange, mortgage, pledge or other disposition of all or substantially all of its corporate stock d. Investment of funds for the accomplishment of the primary purpose of the corporation ANSWER: D

16. Director may be given compensation through any of the following ways, except by: a. The vote of the stockholders representing at least a majority of the outstanding capital stock b. A provision in the by-laws c. The vote of the Board of Directors if the compensation is a reasonable diem d. The vote of the Board of Directors if the compensation is other than per diems ANSWER: A

17. Under this theory, the nationality of a corporation is that of the country under whose laws it was formed a. Control test b. Incorporation test c. Domiciliary test d. Grandfather rule ANSWER: B

18. The subscriber of unpaid shares which are not delinquent shall be entitled to the following rights, except the right to: a. Vote b. Inspect corporate books c. A stock certificate d. Dividends ANSWER: C

19. Immediately after their election, the directors must formally organize by election the following officers, except: a. President b. Vice-President c. Treasurer d. Corporate Secretary ANSWER: B

20. Which of the following is not a characteristic of a corporation? a. Perpetual life b. Transferability of ownership interests c. Unlimited liability on the part of the stockholders d. Ability to attract large amount of capital ANSWER: C