SOURCE OF OBLIGATIONS AND THEIR CONCEPTS - ASSESSMENT

1. When A voluntarily takes charge of the neglected business of B without the latter’s authority where
reimbursement must be made for necessary and useful expenses, there is a: (Phil CPA, 97-2)
a. Negotiorum gestio
b. Solutio indebiti
c. Quasi contract
d. Quasi delict
2. The buyer of a thing has the right to the fruits of the thing: (Phil CPA, 89-2)
a. From the time the sale is perfected
b. From the time the obligation to deliver the thing bought arises.
c. From the time the thing bought is delivered
d. From the time the fruits are delivered
3. Y sold his horse to Z for P50,000. No payment has yet been made and the sales document does not
provide the date of delivery. Before delivery and payment, the horse gave birth to a baby horse. (Phil
CPA, 88-1)
a. Y is entitled to the fruit (baby horse) because it was born before his obligation to deliver the horse
b. Y is entitled to the fruit (baby horse) as Z has not paid the price yet
c. Z is entitled to the baby horse which was born after the perfection of the contract
d. Z should pay additional amount for the baby horse to be entitled to it
4. The obligation of the employer to pay death benefits and funeral expenses for his employer’s death
while in the course of employment as sanctioned by the Workmen’s Compensation Act is one that arises
from: (Phil CPA, 91-1)
a. Law
b. Answer not given
c. Contracts
d. Quasi contract
5. Unless the law or the stipulation of the parties required another standard of care, the obligation to give a
thing carries with it the obligation to take care of it with: (Phil CPA, 91-1)
a. Ordinary diligence
b. Extra ordinary diligence
c. Answer not given
d. Diligence of a good father of a family

KINDS OF OBLIGATIONS IN GENERAL UNDER THE CIVIL CODE – ASSESSMENT

1. Which of the following statements is not correct? (Phil CPA, 96-2)

a. A sale is consummated upon delivery of the thing and the payment of the purchase price
b. Actual delivery of the thing or payment of the price is not required for the perfection of the sale
c. Sales through letters or telegrams are deemed perfected only when acceptance by the buyer has been
received by the seller
d. A stipulation that even when the object is delivered to the buyer, ownership will not pass until the
price is fully paid is not valid
2. When the thing deteriorates pending the fulfillment of the suspensive condition without the fault of the
debtor, the impairment is: (Phil CPA, 98-1)
 a. to be borne by the debtor
b. to be borne by the party who caused the deterioration
c. to be borne partly by the debtor and partly by the creditor
d. to be borne by the creditor
3. This is the promissory note: We promise to pay A, B and C the sum of ONE HUNDRED EIGHTY
THOUSAND (P180,000) PESOS within 60 days. Signed X, Y and Z”: (Phil CPA, 89-2)
a. X is obliged to pay A, B and C P180,000
b. X is obliged to pay A P20,000
c. X is obliged to pay A P60,000
d. X is obliged to pay A P180,000
4. A, B, C and D are joint creditors of E and F, solidary debtors in the amount of P40,000. How much can
A, B and C collect from E? (Phil CPA, 90-1)
a. A, B, C and D could collect P30,000 from E
b. A, B, C and D could collect P20,000 from E
c. A, B, C and D could collect all the P40,000 from E
d. A, B, C and D could collect P20,000 from E and P10,000 from F
5. A, B and C solidarily owe X and Y P30,000. X remitted the entire obligation in favor of A. The effect
is: (Phil CPA, 97-2)
a. The obligation is not extinguished until A collects from B and C
b. A can recover from B and C their respective share of the debt
c. A cannot recover from B and C because remission in his favor extend to the benefit of B and C
d. The obligation is not yet extinguished until Y is paid by X of Y’s share of the credit
6. A, B and C secured a load from D. The promissory note which evidence the obligation states: “I promise
to pay D or order P10,000 payable on demand” (Sgd) A B C. The obligation is: (Phil CPA, 95-1)
a. Solidary
b. Divisible
c. Indivisible
d. Joint
7. A, B and C secured a loan from X. The promissory note which evidences the obligation stated. “I
promise to pay” and signed by A, B and C. The obligation is: (Phil CPA, 87-1)
a. Divisible
b. Joint
c. Indivisible
d. Solidary
8. In three (3) of the following cases advanced payment by the debtor is not recoverable. Which is the
exception? (Phil CPA, 89-2)
a. The payment is only for interest and credited to the proper period
b. The obligation was not due and demandable but the debtor believed it was already due and
demandable
c. The debtor was not aware of the period
d. The advance payments were made by both parties reciprocally
9. XYZ are solidarily liable to A for P30,000 which mature on July 1 1993. On May 1, 1993, X paid A for
the whole amount of the debt. If on December 1, 1993, X will be reimbursed by Y, the latter will be
liable for: (Phil CPA, 98-1)
a. P10,000 with interest from May 1, 1993 to July 1, 1993
 b. P10,000 with interest from July 1, 1993 to December 1, 1993
c. P10,000 without interest
d. P10,000 with interest from May 1,1993 to December 1, 1993
10. Bertulfo and Claudio promise to deliver a particular car valued at P100,000 to Manuela on or before
September 15, 1991. September 15, 1991 came and upon demand by Manuela for delivery from Bertulfo
and Claudio. Bertulfo was willing to deliver but Claudio refused to deliver. In the case at bar: (Phil CPA,
91-2)
a. Both Bertulfo and Claudio shall be liable for P50,000 each with damages
b. Answer not given
c. An action for specific performance will lie against both Bertulfo and Claudio
d. Bertulfo shall be liable for P50,000 without damages and Claudio shall be liable for P50,000 and
damages
11. A and B are joint creditors mancomunados of X and Y, joint debtors for a total sum of P9,000. A owns
1/3 of the credit; B owns 2/3 of it. But X owns 2/5 of the debts; Y owes 3/5 of the debt. In this case:
(Phil CPA, 87-2)
a. B can only collect from X, P9,000 and from Y, P0
b. A can only collect from X, P4,500 and from Y, P4,500
c. A can only collect from X, P3,600 and from Y, P5,400
d. B can only collect from X, P5,400 and from Y, P3,600
12. When the debtor binds himself to pay when means permit him to do so, the obligation is: (Phil CPA, 97-
2)
a. Conditional
b. Pure
c. Simple
d. With a period
13. The creditor shall have a right to indemnity for damages when, through the fault of the debtor, all the
things which are alternatively the object of the obligation have been lost or compliance of the obligation
has become impossible. The indemnity shall be fixed as a basis: (Phil CPA, 87-1)
a. The value of the first thing which disappeared
b. The value of the last thing which disappeared
c. The value of the least expensive thing
d. The value of the most expensive thing
14. X obliged himself to pay Y the amount of P30,000 30 days after May 31, 1993 plus a penalty of P3,000
if he fails to pay the obligation on due date and after demand for payment by Y, offered to pay on July
30, 1993. Y can demand from X: (Phil CPA, 94-2)
a. P30,000 plus P3,000 plus legal interest plus damages
b. P30,000 plus P3,000 plus legal interest
c. P30,000 plus legal interest
d. P30,000 plus P3,000
15. OE is obliged to give OR his 1982 Mitsubishi, 4 door sedan Lancer with plate number NBA 123 on
September 30, 1989. On October 10, 1989, OE is not yet deliver the car which was totally destroyed by
an earthquake on such date. Is OE still liable? (Phil CPA, 89-2)
a. Yes. OR can instead demand for another car of equivalent value from OE
b. No. The obligation is extinguished. The specific thing was lost due to fortuitous event and no
demand or deliver was made by OR
 c. Yes. OE is in legal delay. OR can claim damages
d. No. Even OE is already in default and can plead impossibility of performance
16. A, B and C borrowed P36,000 from X and Y. The three (3) debtors signed a promissory note January 10,
1988 promising to pay the creditors on or before July 10, 1988. How much can X collect from C? (Phil
CPA, 89-1)
a. P6,000
b. P18,000
c. P12,000
d. P36,000
17. A, B and C are solidary debtors of X in the amount of P12,000. X then made a demand from A but was
able to collect P8,000 only because X was remitting A’s share of P4,000. How much can A collect each
from B and C? (Phil CPA, 87-2 modified)
a. P6,000
b. P8,000
c. P12,000
d. P4,000
18. It refers to joint obligation: (Phil CPA, 93-1)
a. One in which the obligation of one is a resolutory condition of the obligation of the other, the non
fulfillment of which entitled the other party to rescind the contract
b. One in which each of the debtors is liable only for a proportionate part of the debt and each creditor
is entitled only for a proportionate part of the credit
c. One in which each debtor is liable for the entire obligation and each creditor is entitled to demand
the whole obligation
d. One in which either one of the parties is indispensable and the other is not necessary
19. X and Y are solidary debtors of A, B, C and D joint creditors to the amount of P8,000. How much can A
collect from X? (Phil CPA, 88-1)
a. A could recover P2,000 only from X
b. A could recover P1,000 only from X
c. A could recover P4,000 from X. A, in turn has to give B, C and D, P1,000 each
d. A could recover P8,000 from X, A in turn has to give B, C and D
20. In a joint obligation, A, B and C are debtors of joint creditors, D, E and F in the amount of
P180,000.00. A’s obligation is: (Phil CPA, 92-2)
a. Pay D, E and F, P180,000.00
b. Pay D P120,000.00
c. Pay D P20,000.00
d. Pay D P60,000.00
21. This is a promissory note: “We promise to pay Dulce, Carina and Corina the sum of P180,000.00”
(sgd) Jovy, Bimbo and Garry. (Phil CPA, 96-1)
a. Garry is obliged to pay Dulce, Bimbo and Corina P18,000.00
b. Garry is obliged to pay Corina P6,000.00
c. Garry is obliged to pay Corina P2,000.00
d. Garry is obliged to pay Corina P12,000.00
22. Payment of the obligation by a solidary debtor shall not entitle him to reimbursement from his co-
debtors: (Phil CPA, 87-1)
a. If such payment was made after the obligation has prescribed or become illegal
 b. If such payment was made after the obligation has become due and demandable and notice of
payment was made only to him
c. If such payment was made in compliance with the demand to him by all the creditors
d. If such payment was made before the obligation is due
23. In an obligation where only one (1) prestation has been agreed upon, but to extinguish the obligation the
debtor is allowed and does render another substitute, the obligation is:
a. Alternative Obligation
b. Simple Obligation
c. Facultative Obligation
d. Conjoint Obligation
24. A and B are solidary debtors of X, Y and Z, joint creditors to the amount of P15,000. How much can Z
collect from B? (Phil CPA, 88-2)
a. Z could recover P5,000 from B
b. Z could recover P7,500 from B
c. Z could recover P15,000 from B. Z in turn has to give X and Y P5,000 each
d. Z could recover P15,000 from B. B in turn can collect from A the amount of P7,500
25. In a Joint obligation, A,B, and C are debtors of joint creditors D, E, and F, in the amount of P180,000.
A’s obligation is: (Phil CPA, 96-1)
a. Pay D P120,000.00
b. Pay D P20,000.00
c. Pay D, E and F P180,000.00
d. Pay D P60,000.00
26. A, B and C borrowed P24,000 from Y and Z signed a promissory note dated January 15, 1987 and due
within six (6) months. How much can Y collect from A? (Phil CPA, 88-2)
a. P6,000
b. P4,000
c. P12,000
d. P24,000
27. X and Y and Z solidarily owe A, B, C, D, joint creditors P30,000. How much can A collect from X?
(Phil CPA, 96-2)
a. P5,000 only
b. P20,000, A in turn has to give P5,000 to B, C, and D
c. P7,500 only
d. P10,000, A in turn has to give P2,500 each to B, C, and D
28. Mr. Cruz executed a first mortgage of his house in favor of Mr. Dizon on May 15, 1986 to guaranty a
mortgage loan of P200,000 due for payment on May 15, 1987. On September 16, 1986 the house was
completely destroyed by a typhoon. On September 18, 1986 Mr. Dizon demanded payment from Mr.
Cruz of the loan. Is Mr. Dizon’s demand for payment valid? (Phil CPA, 88-2)
a. No. The obligation is extinguished because the object of the obligation is lost through a fortuitous
event
b. Yes. The obligation becomes due at once because the guaranty was lost even through fortuitous
event, unless the debtor can mortgage another property that is equally satisfactory
c. Yes. The obligation becomes due at once because from the tenor benefit of the creditor solely
thereby giving the creditor the right to demand performance even before the due date stipulated
 d. No. The obligation is one with a definite period, so the creditor cannot demand payment until the
definite due date arrives
29. When the debtor binds himself to pay when his means permit him to do, the obligation is considered as
one: (Phil CPA, 91-1)
a. With a condition dependent upon the debtor’s sole will.
b. That is void.
c. Answer not given.
d. With a period.
30. When the period is “on or before a date”, the debtor has the benefit of the period. This benefit is lost and
the obligation becomes demandable when: (Phil CPA, 90-2)
a. The debtor attempts to abscond
b. Demand by the creditor could be useless
c. After contracting the obligation, the creditor suspects the debtor to becoming insolvent
d. The guarantee given by the debtor is not acceptable to the creditor
31. A obliges himself to pay X P100,000 in 30 days plus a penalty of P20,000 if A fails to pay the obligation
in due time. A failed to pay the obligation in 30 days. X can demand from A: (Phil CPA, 90-2)
a. The principal of P100,000 plus P20,000 penalty, plus legal interest damages
b. The principal of P100,000 plus legal interest
c. The principal of P100,000 plus P20,000 penalty, plus legal interest, plus damages
d. The principal of P100,000 plus P20,000 penalty
32. O gets a loan of P100,000 from P, which becomes due on November 23, 1993 and mortgaged his house
as security for the debt. On September 22, 1993, the mortgaged house was completely destroyed by
fire. A week after, P demanded payment from O on September 29, 1993. Is P’s demand valid? (Phil
CPA, 93-2)
a. Yes, the debt becomes demandable because the collateral was lost through a fortuitous event
b. Yes, the debts become demandable because the period established is for the benefit of the creditor
c. No, the obligation is extinguished because the object of the obligation is lost through a fortuitous
event
d. No, because the obligation is one with a definite period and the demand would be prejudicial to the
rights of the debtor
33. Mr. AB owes Mr. CD P150,000 due on August 31, 1987. Mr. AB executed a mortgage in favor of Mr.
CD on Mr. AB’s building to guaranty the obligation. On August 10, 1987 the mortgaged building was
totally lost due to a strong typhoon. On August 12, 1987, Mr. CD demanded payment from Mr. AB. Is
Mr. CD’s demand valid? (Phil CPA, 88-1)
a. No. The obligation is one with a definite period, thus the creditor cannot demand fulfillment of the
obligation as such would the prejudicial to the rights of the debtor
b. Yes. The debt becomes due at once because, from the tenor benefit is given solely to the creditor
thereby giving the creditors the right to demand performance even before the date
c. Yes. The debt becomes due at once because the guaranty was lost even through a fortuitous event
unless the debtor can mortgage another property that is equally satisfactory
d. No. The obligation is extinguished because the obligation is lost through a fortuitous event
34. This is a promissory note: “We promise to pay Dalsa, Cristina and Catherine the sum of P18,000”
(Signed) Jeng, Bambi and Gail: (Phil CPA, 92-1)
a. Gail is obliged to pay Catherine P2,000
b. Gail is obliged to pay Catherine P12,000
 c. Gail is obliged to pay Dalsa, Bambi and Catherine P18,000
d. Gail is obliged to pay Catherine P6,000
35. The obligation is demandable on the date of the obligation and shall continue to be in force up to the
arrival of the day certain: (Phil CPA, 95-1)
a. Resolutory period
b. Legal period
c. Indefinite period
d. Suspensive period
36. Carlo and Cleo are solidary debtors of Cxc z0orina, Luis, Edward, and Abelito, Joint creditors in the
amount of P20,000. How much can Corina collect from Carlo? (Phil CPA, 92-1)
a. Corrina could collect P10,000 from Carlo, Corrina is then obliged to give P2,500 each to Luis.
Edward and Abelito
b. Corrina could collect the whole P20,000 from Carlo but will in turn give P5,000 each to Luis,
Edward and Abelito
c. Corrina could collect P2,500 from carlo
d. Corrina could collect P5,000 from Carlo
37. An obligation where only the presentation has been agreed upon but the debtor may render another in
substitution is: (Phil CPA, 98-1)
a. simple obligation
b. alternative obligation
c. facultative obligation
d. conjoint obligation
38. A promissory note signed by Martiniano and dated March 15, 1991 is worded as follows: “I promise to
pay Juanita the sum of Fifty Thousand Pesos (P50,000) provided that if she should fail in the October,
1991 CPA Examination, she shall return to me said amount.” The above note gives rse to an obligation
with: (Phil CPA, 91-2)
a. Suspensive condition
b. Resolutory condition
c. Answer not given
d. Casual condition
39. Mr. Santos secured and Mr. Dizon granted a loan of P100,000 due for payment on December 31,1988.
Mr. Santos executed a first mortgage of his residential house in favor of Mr. Dizon to guaranty the
P100,000 loan. On October 19, 1988 the residential house was totally destroyed by typhoon Unsang. On
October 31, 1988 Mr. Dizon demanded payment of the loan from Mr. Santos. Is the demand of Mr.
Dizon for payment valid. (Phil CPA, 89-1)
a. No. The object of the obligation was lost through a fortuitous event and the obligation was
extinguished
b. Yes. The obligation became due at once because the guaranty was lost through a fortuitous event
c. Yes. The obligation became due at once because from the tenor benefit, the creditors is given the
right to demand performance even before the due date stipulated
d. No. The obligation is one with a definite date for payment on December 31, 1988 and until that date
arrives, Mr. Santos is not liable to pay
40. Carlito, Alfredo and Francis owed in solidum P15,000 to Ricardo as evidenced by a promissory note due
on September 30, 1981. The note prescribed on September 30, 1991. On October 10, 1991, Carlito paid
Ricardo. In this case, Carlito is: (Phil CPA, 91-2)
 a. Answer not given
b. Not entitled to reimbursement from his co-debtors for the shares of the latter
c. Entitled to recover from Ricardo
d. Entitled to collect P5, 000 each from Alfredo and Francis
41. A solidary obligation is one in which each of the debtor is liable for the entire obligation or debt and
each of the creditors is entitled to the entire credit. Obligations shall also be considered solidary under
the following three exceptions. Which does not belong to the exception? (Phil CPA, 87-1)
a. When solidary is expressly stipulated in the obligation
b. When the law expressly provides solidarity
c. When the prestation is indivisible and there are two or more debtors and creditors
d. When solidarity is required from the nature of the obligation
42. A, B, and C solidarily bound themselves to deliver to X a Honda Motorcycle. The obligation was not
fulfilled through the fault of A. Thereupon, X filed an action in court against C and the court awarded
P36,000 to X. Which of the following situations is valid? (Phil CPA, 96-2)
a. X cannot collect the whole amount of P36,000 from C
b. X has to collect P12,000 each from A, B, and C to satisfy the court’s award of P36,000
c. If C pays X the P36,000, C can collect from B P10,000 and from A P16,000
d. If C pays X the P36,000, C can collect from A and B P12,000 each representing their
proportionate share in the value of the prestation
43. X and Y are solidary debtors of A, B and C, joint creditors to the amount of P30,000. How much can B
collect from X? (Phil CPA, 95-1)
a. B can collect P15,000 from X
b. B can collect P30,000 from X. B n turn has to give A and C P10,000
c. B can collect P10,000 from X
d. B can collect P60,000 from X. X in turn can recover from Y the amount of P15,000
44. In this case, advance payment by the debtor is recoverable: (Phil CPA, 90-1)
a. If the advance payment is in reciprocity to the advance payment of the other party
b. If the advance payment is only of interest due
c. If the creditor demanded for the advance payment and the debtor knew it was not yet due
d. If the debtor was unaware of the period
45. A-1 and A2 are solidary debtors of B-1, B-2 and B3, joint creditors in the amount of P90,000. How
much can B-3 collect from A-2? (Phil CPA, 90-2)
a. B-3 could collect P15,000 from A-2 and P15,000 from A-1
b. B-3 could collect P90,000 from A-2 and give P30,000 each to B-1 and B-2
c. B-3 could collect P30,000 from A-2
d. B-3 could collect P45,000 from A-2 and give P15,000 each to B-1 and B-2

SPECIFIC CIRCUMSTANCES AFFECTING OBLIGATIONS IN GENERAL – ASSESSMENT

1. This person is liable for the loss of the subject matter by fortuitous event: (Phil CPA, 85-2; 88-1; 89-1)
a. Debtor
b. Both a and b
c. Creditor
d. None of them
2. Whenever in an obligation a period is designated, it is presumed to have been established for the benefit
of: (Phil CPA, 98-1)
a. the debtor
b. both the creditor and the debtor
c. the third party
d. the creditor
3. When the characters of creditors and debtor are merged on the same person, the mode of extinguishing
an obligation is called: (Phil CPA, 86-2)
a. None of the three
b. Compensation
c. Novation
d. Confusion or merger
4. A condition with, if imposed on an obligation will be disregarded and will therefore make the obligation
immediately demandable: (Phil CPA, 94-1)
a. If Juan commits suicide
b. If Juan will not rise from the dead
c. If Juan kills Pedro
d. If Juan passes the bar examination
5. X is under obligation to deliver his Toyota car to Y. However, before delivery Z destroys the car. Which
one of the following is not correct? (Phil CPA, 98-1)
a. X’s obligation to give his car to Y is extinguished
b. Y has a right to bring action against Z
c. X is allowed to recover from Z
d. X is not obliged to give Y an equivalent value of the car
6. It is not a source of liability which will entitle the injured party to damages: (Phil CPA, 93-2)
a. Dishonesty, malice or bad faith in the performance of an existing valid obligation
b. Culpa Aquiliana or negligence committed in the performance of a spontaneous act
c. Contravention of the tenor of obligation
d. MORA or delay
7. These statements concerning delay are presented to you:
I. There is no delay in obligations not to do.
II. As a rule, the debtor will be in default if he does not perform his obligations on due date

In your evaluation of the foregoing statements:

a. Both statements are true.

b. Both statements are false.
c. Only Statement I is true.
d. Only Statement II is true.
8. A to sell B his lot and house in the city if A decides to transfer and live, in the countryside” is an
example of: (Phil CPA, 94-1)
a. Casual condition
b. Potestative condition
c. Mixed condition
d. Resolutory condition
9. If the obligor binds himself to perform his obligation as soon as “he shall have obtained a loan from a
certain bank, this obligation is: (Phil CPA, 93-1)
a. Suspensive
b. With a term
c. Conditional
d. Void
10. Mr. Montecillo entered into a contract with Mr. Villarojo by which Mr. Montecillo promised to deliver
1,000 cases of glassware of the class and at the price stipulated in the contract. Such delivery was to be
made during the months of February and March, 1991. In this case, no further demand or notice by Mr.
Villarojo on Mr. Montecillo was necessary because: (Phil CPA, 91-1)
a. The obligation expressly so provides
b. Answer not given
c. Time is the essence of the contract
d. The demand would be useless
11. On July 1, 1989 A signs a promissory note and binds himself to pay X P100,000 plus 15% per annum
interest on June 30, 1991: (Phil CPA, 90-2)
a. Because the period is for the benefit of the debtor, A can compel creditor X to accept payment any
date before June 30, 1991
b. Before June 30, 1991 X can demand payment
c. If on June 30, 1990 A is paying X. X cannot refuse the payment
d. Because the period is for the benefit of the debtor and creditor, X can refuse any tendered payment
before June 30, 1991
12. A borrower who uses the thing for a purpose different from that intended, delays its return, receives the
thing under appraisal, lends it to a third person, or saves his property instead of the thing borrowed shall
be liable even in case of fortuitous event, because: (Phil CPA, 91-1)
a. Answer not given
b. The parties have expressly stipulated such liability
c. The law so expressly provides
d. The nature of the obligation requires the assumption of risk
13. Mr. ABC is obliged to give Mr. XYZ his only car on July 15, 1987. Mr. ABC did not deliver the car on
July 15, 1987. On July 20, 1987 an earthquake destroyed the building where the car was in garage and
the car was destroyed. Is Mr. ABC still liable? (Phil CPA, 88-1)
a. Yes. Mr. ABC is already in legal delay, thus the obligation to deliver the lost specific thing is
converted into monetary claim for damages
b. No. Considering that no demand to deliver was made by Mr. XYZ and the specific thing was lost
due to fortuitous event, the obligation is extinguished
c. Yes. The creditor can instead demand for a substitute equivalent in value from the debtor
d. No. The obligation is extinguished, even if the debtor is already in default, because the debtor can
plead impossibility of performance

EXTINGUISHMENT OF OBLIGATION – ASSESSMENT

1. When two (2) persons are reciprocally debtors and creditors, there is: (Phil CPA, 88-2, 89-1)
a. Compensation
b. Merger
c. Confusion
 d. Consignation
2. An act of liberality whereby a creditor condones the obligation of the debtor: (Phil CPA, 98-1)
a. Confusion
b. Novation
c. Compensation
d. Remission
3. This special form of payment is the conveyance of the ownership of a thing as accepted equivalent of
performance. (Phil CPA, 85-2)
a. Tender of payment and consignation
b. Application of payment
c. Dation in payment or dacion en pago
d. Assignment of property or cession en pago
4. The leviable properties of the debtor are transferred to the creditors to be sold and from the proceeds, the
creditors are paid: (Phil CPA, 94-2)
a. Chattel mortgage
b. Pledge
c. Cession
d. Dacion en pago
5. One is not a requisites needed in order that obligation shall be extinguished by loss or destruction of the
thing due: (Phil CPA, 94-2)
a. When the thing lost is specific
b. When the thing is lost without the fault of the debtor
c. When the thing lost is generic
d. When the thing is lost before the debtor has incurred in delay
6. When the debtor abandons and assigns all his properties in favor of his creditors for the latter to sell to
satisfy his credits, this is: (Phil CPA, 90-1)
a. Remission
b. Expromission
c. Dation in payment
d. Payment by cession
7. A executes promissory note in favor of B and that promissory note is negotiated by B and subsequently
indorsed in favor of A. The obligation to pay the said promissory note is thereby extinguished because
there is: (Phil CPA, 91-1)
a. Confusion or merger
b. Answer not given
c. Remission
d. Novation
8. Consignation is a mode of payment which extinguishes an obligation. Which of the following is not a
requisite for consignation? (Phil CPA, 87-1)
a. Prior notice has not been made
b. Actual consignation with the proper judicial authorities
c. Existence of a valid debt
d. There must be prior notice of consignation to persons interested in the fulfillment of the obligation.
9. X, a minor sold to Y his parcel of land for P100,000. From the proceeds of the sale, X deposited P30,000
in the bank spent for food, clothing and other personal expenses P20,000, joined a tour abroad costing
 P20,000, lost in gambling P20,000 and loaned P10,000 to Z who became insolvent. Upon reaching the
age of 21 years, X files an action for annulment which the court granted. Y was required to return the
land to X and X was made to return to Y the amount of: (Phil CPA, 94 1)
a. P80,000
b. P40,000
c. P70,000
d. P30,000
10. This mode of extinguishment of obligations is when two (2) persons, in their own rights, are creditors
and debtors of each other. (Phil CPA, 90-1)
a. Compensation
b. Novation
c. Condonation or remission
d. Merger or consolidation
11. Mr. Debtor owes Mr. Creditor who has two (2) legitimate emancipated children, P50,000.00 payable on
December 31, 1991. (Phil CPA, 92-2)
a. If Mr. Creditor dies, his two (2) legitimate emancipated children cannot recover from Mr. Debtor his
obligation
b. If both Mr. Debtor and Mr. Creditor die, the heirs of Mr. Creditor can collect from the heirs of Mr.
Debtor
c. If Mr. Debtor dies before December 31, 1991, Mr. Creditor cannot collect from the heirs of
Mr. Debtor
d. If Mr. Debtor dies before December 31, 1991, Mr. Creditor can collect from the heirs of Mr. Debtor
12. Takes place when two persons in their own right, are creditor and debtor of each other: (Phil CPA, 98-1)
a. Compensation
b. Remission
c. Novation
d. Confusion
13. A owes B P10,000. With consent of both, C pays B P5,000. Now B and C are the creditors of A to the
amount of P5,000 each. Suppose A has only P5,000. Which is correct? (Phil CPA, 98-1)
a. C should be preferred
b. B and C should divide the P5,000 equally
c. B should be preferred
d. A may choose whom to pay
14. Sale is distinguished from dation in payment in that in sale: (Phil CPA, 91-2)
a. Answer not given
b. It is a mode of extinguishing an obligation in the form of payment
c. The cause is the price
d. There is a pre-existing obligation or credit
15. A owes X P50,000 payable on or before June 30, 1990. S who is not a party to the contract and without
the consent and against the will of A paid 1990 when the prevailing rate of interest was 12% per annum.
(Phil CPA, 90-2)
a. S can ask reimbursement from A in the amount of P50,000 plus 12% interest from April 1 to June
30, 1990
b. S can ask reimbursement from A in the amount of P50,000
 c. S cannot ask reimbursement from A because the payment by S is without the consent and against the
will of A
d. S can ask refund from X because the payment by S was against the will of A
16. It presupposes not only that the obligor is able, ready, and willing, but more so, in the act of performing
his obligation. (Phil CPA, 93-1)
a. Obligation to sell
b. Bill of exchange
c. Promissory note
d. Tender of payment
17. Jesus owes Maria P1,000.00 on June 30, 1993.
Maria owes Jesus P600.00 due on June 20, 1993.
Maria owes Jesus P400.00 due on June 30, 1993.
Maria owes Jose P1,000.00 due on June 30, 1993.
On June 25, 1993, Maria cannot pay Jose P1,000.00 so she assigns to Jose her credit card of P1,000.00
against Jesus without the knowledge of Jesus. On July 2, 1993, Jose tries to collect from Jesus the
P1,000.00. How much can Jose compel to pay? (Phil CPA, 93-2)
a. P400.00
b. P1,000.00
c. Zero
d. P600.00
18. The P1,000 bills issued by the central bank and in circulation are considered: (Phil CPA, 93-1)
a. Promissory note
b. Legal tender
c. Bills of exchange
d. Checks
19. Dacion en pago as distinguished from sale: (Phil CPA, 98-1)
a. there is a greater degree of freedom in fixing the price
b. the cause is the price
c. the object is always existing and specific
d. there is no pre-existing obligation
20. Which of the following is not an element of Compensation: (Phil CPA, 95-1)
a. There are two or more debts of the same kind
b. There are two persons who are creditors and debtors of each other
c. Debts to be compensated are due and demandable
d. There is controversy or adverse claim over any debts to be compensated
21. If the creditor to whom tender of payment has been made refuses without just cause to accept it, the
debtor shall be released from responsibility by: (Phil CPA, 91-1)
a. Assignment of property
b. Adjudication or dacion en pago
c. Consignation of the thing or sum due
d. Answer not given
22. Compensation shall take place when: (Phil CPA, 91-1)
a. One of the debts arises from a depositum or from the obligations of a depository or of a bailees in
commodatum
b. One of the debts consists in civil liability arising from a penal offense
 c. Answer not given
d. Two persons, in their own right are creditors and debtors of each other
23. The following shall produce the effect of payment of debts: (Phil CPA, 91-1)
a. Delivery of Promissory Notes
b. Answer not given
c. Delivery of check
d. Tender of Central Bank Notes
24. When two person in their own rights are reciprocally creditors and debtors of each other and
extinguishes both debts to the concurrent amount, what takes place is known as: (Phil CPA, 91-1)
a. Confusion and merger
b. Compensation…… Module Assessment
c. Remission
d. Novation
25. On October 4, 1987, A is indebted to B for P50,000 for a 20 day period. A proposed to B that X will pay
A’s debt and that A will be free from all liabilities. B and X agree to the proposal. On October 25, 1987,
X became insolvent. At the time of delegation, X was already insolvent but this was not known to A.
The insolvency is not of public knowledge. So B sues A on the ground that it was A who made proposal
that A guaranteed X’s solvency. Decide: (Phil CPA, 87-2)
a. A is not liable, because A does not know the insolvency of X at the time of delegacion and neither
was the insolvency of public knowledge
b. A is liable because he did not exercise due diligence in determining the insolvency of X
c. A is liable because X agree to the proposal to make himself solidary liable for the obligation
d. A is liable because he is presumed to have guaranteed X’s solvency
26. One of the following statement is not true: (Phil CPA, 93-1)
a. The Philippine peso bills when attempted to be exported, as when carried in excess of that allowed
by the CB regulation, may be deemed to have been taken out of domestic circulation as legal tender
and thus treated as commodity
b. The purchasing power of value of money or currency depends upon, can come into being can be
created or brought about by a law enacted by the legislative department of the Government
c. A creditor is not bound to accept a check in satisfaction of his demand, because a check even if good
when offered, does not meet the requirements of legal tender
d. The obligation of a debtor who had agreed to pay in dollars in a foreign bill of exchange, shall be
discharged in Philippine currency measured at the prevailing rate of exchange at the time obligation
was incurred
27. When the debtor abandons or transfers all his properties to the creditors so that the creditors may sell the
properties and out of the net proceeds the creditors recover their claims this is called: (Phil CPA, 90-2)
a. Payment of cession
b. Remission
c. Tender of payment and consignation
d. Dacion en pago
28. When the characters of the creditor and the debtor are merged in one and the same person, there is
extinguishment of the obligation by: (Phil CPA, 96-2)
a. Merger of rights
b. Novation
c. Remission
 d. Compensation
29. On June 5, 1991, Jose Dizon of Angeles City is obliged to give Ruben Samia, Jose Dizon’s red crew
cab. There was no delivery until June 15, 1991 when the garage of the red crew cab collapsed due to
heavy ash and sand spewed by Mt. Pinatubo and the red crew cab was totally destroyed. After the crew
cab was destroyed and lost, is Jose Dizon still liable? (Phil CPA, 92-2)
a. Yes. The obligation to deliver the crew cab is changed to pay the equivalent value because
Jose Dizon is in legal delay
b. Yes. Because the contract is perfected
c. No. Because there was no demand by Ruben Samia to deliver the crew cab and the specific object
was lost due to fortuitous event. The obligation is extinguished
d. No. Even if Jose Dizon was already in default, he could plead impossibility of performance
30. A thing is not deemed lost when it: (Phil CPA, 98-1)
a. Perishes
b. disappears in such a way its existence is unknown or it cannot be recovered
c. deteriorates
d. goes out of commerce
31. The distinction between conventional subrogation and assignment is that in conventional subrogation:
(Phil CPA, 91-1)
a. Answer not given
b. It is a mere cession of right
c. The same obligation, without being extinguished, is transferred to another
d. An obligation is extinguish and another appears
32. Which of the examples given below can compensation take place? (Phil CPA, 95-1)
a. A owes B P1,000 with C as his guarantor. B owes C P1,000
b. A owes B P1,000 due on June 30, 1993. B owes A P1,000 due on June 30, 1993 but C has filed an
adverse claim against A
c. A owes B P1,000 payable October 31, 1993; B owes A P1,000 due on October 31, 1993
d. A owes B P1,000 payable May 31, 1993. B to deliver to A 2 piculs of sugar worth P1,000 on May
31, 1993
33. C is the creditor of D in the amount of P50,000. C is the guarantor of D paid C partially with P20,000. A
not knowing the partial payment of D and against the will of D paid C the amount of P50,000. What is
the effect of this payment in the obligation: (Phil CPA, 89-2)
a. The obligation is extinguished. A can demand P30,000 from D, but if D cannot pay, A cannot
ordinarily proceed against guarantor C because A is not entitled to subrogation
b. The obligation is extinguished. A can demand P30,000 from D because this amount benefited D or A
having subrogated into rights of C can proceed against guarantor G
c. The obligation is not extinguished. A’s payment against being the will of D does not extinguish the
obligation
d. The obligation is extinguished. A cannot recover any amount from D but A can demand
reimbursement from C in the amount of P50,000
34. It is a mode of extinguishing an obligation when two persons in their own right are creditors of each
other: (Phil CPA, 86-2; 94-1; 94-2)
a. Compensation
b. Confusion
c. Reformation
 d. Novation
35. When an obligation is extinguished because of the passage of time, this is: (Phil CPA, 90-2)
a. Fulfillment of resolutory condition
b. Arrival of a resolutory period
c. Rescission
d. Prescription
36. A obliged himself to give B a car if B places among the top ten in the CPA Board Exam. Subsequently,
they agreed that A will give B the car if B merely passes the CPA Board. This is an example of: (Phil
CPA, 94-2)
a. Mixed novation
b. Real novation
c. Personal novation
d. Implied novation

The following shall be deemed guilty of unfair competition:

a. Any person, who is selling his goods and gives them the general appearance of goods of another
manufacturer or dealer, either as to the goods themselves or in the wrapping of the packages in which
they are contained, or the devices or words thereon, or in any other feature of their appearance, which
would likely influence purchasers to believe that the goods offered are those of a manufacturer or dealer,
other than the actual manufacturer or dealer.
b. All of the above
c. Any person who shall make any false statement in the course of trade or who shall commit any other act
contrary to good faith of a nature calculated to discredit the goods, business or services of another
d. Any person who by any artifice, or device, or who employs any other means calculated to induce the
false belief that such person is offering the services of another who has identified such services in the
mind of the public.

Any person who shall, without the consent of the owner of the registered mark reproduce, counterfeit, copy or
colorably imitate a registered mark or a dominant feature thereof and apply such reproduction, counterfeit, copy
or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or advertisement intended to be
used in commerce upon or in connection with the sale, offering for sale, distribution, or advertising of goods or
services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive.

A. Copyrighting of trademark
B. Infringement of trademar
C. Patenting of trademark
D. Unfair competition of trademark

CONCEPTS AND CLASSIFICATION – ASSESSMENT

1. Strictly speaking, which of those should not anymore be considered an innominate contract?
a. Facio ut des or I make that you give;
 b. Do ut facias or I give that you make;
c. Do ut des or I give that you give;
d. Facio ut facias or I make that you make.
2. It takes place when the parties do not intend to be bound at all by their agreement: (Phil CPA, 93-1; 96-
1; 97-1)
a. Absolutely simulated contract
b. Apparent contract
c. Deed of assignment
d. Relatively simulated contract
3. An innominate contract which means “I give that you may do”
a. Do ut facias
b. Do ut des
c. Facio ut facias
d. Facio ut des
4. The mere liberality of the benefactor is the cause in:
a. Onerous contract
b. Contract of pure beneficence
c. All of the above
d. Remunetory contract
5. This is a real contract:
a. Mutuum
b. Deposit
c. All of them
d. Pledge
6. Essential Requisites of a contract:
a. all of them
b. Cause
c. Subject
d. Consent
7. This is not always an essential element of a contract
a. Object;
b. Form;
c. Consideration;
d. Consent
8. These are the basic principles or characteristics of a contract. Which is the exception? (Phil CPA, 90-1)
a. Binding on third parties.
b. Obligatory force and compliance in good faith.
c. Perfection by mere consent.
d. Freedom or liberty to stipulate
9. DO UT FACIAS:
a. I give that you give
b. I give that you make
c. A make that you make
d. I make that you give
 ELEMENTS AND STAGES – ASSESSMENT

1. The stage of “conception” of a contract is:

a. When the parties come to an agreement.
b. When the contract is fully executed.
c. When there is a meeting of the parties’ minds
d. When the negotiations are in progress.
2. Which of these is proof of the perfection of a contract of sale?
a. Earnest money
b. Option money
c. All of them
d. Option
3. S offers to sell his car to B for P125,000 cash. B accepts the offer but is willing to pay only P120,000.
a. The contract was perfected at the price of P120,000.
b. The contract was perfected at the price of P122,500.
c. The contract was perfected at the price of P125,000.
d. The contract was not perfected because the acceptance by B was qualified and it constituted a
counter-offer.
4. A contract is in the stage of conception when: (Phil CPA, 92-1)
a. There is meeting of the minds.
b. Negotiations are in progress.
c. The parties come to the agreement.
d. The contract is perfected
5. This is not always an essential element of contract:
a. Consideration
b. Terms and conditions imposed by the parties
c. Object
d. Consent

FREEDOM FROM CONTRACT AND LIMITATION – ASSESSMENT

1. The principle that the contracting parties may establish such stipulations, clauses, terms and conditions
as they may deem convenient, provided they are not contrary to law, morals, good customs, public order
or public policy.
a. Principle of relativity of contract.
b. Principle of consensuality of contract.
c. Principle of liberty of contract.
d. Principle of mutuality of contract.
2. The characteristic of a contract to the effect that a contract binds not only the contracting parties, but
also the heirs or assigns is called:
a. Relativity of contracts
b. Binding effects of contracts
c. Obligatory force of contracts
 d. Autonomy of contracts
3. The contract must bind both contracting parties, its validity or compliance cannot be left to the will of
one of them, and this is
a. Relativity of contract
b. Obligatoriness of contract
c. Mutuality of contract
d. Freedom of contract
4. Contracting parties are free to enter into all kinds of pacts, terms or stipulations provided they are not
contrary to law, morals, good customs, public policy or public order. The above is a description of the
characteristic of a contract known as:
a. obligatory force of contracts
b. consensuality of contracts
c. relativity of contracts
d. autonomy of contracts

PERSONS BOUND – ASSESSMENT

1. These persons are bound by contracts except:

a. Heirs
b. Assigns
c. Third persons
d. Parties
2. Contracts are effective and binding only between the parties, their assigns and their heirs. Three of the
following enumerations are exceptions as provided by law. Which does not belong to the exception?
(Phil CPA, 87-1)
a. Where the obligations arising from contract are not transmissible by their nature.
b. Where the obligations arising from contract are not transmissible by stipulation or by provision of
law.
c. Where there is a stipulation in favor of a third party
d. Where one of the parties to the contract dies and thereafter a suit is filed on the basis of the contract.
3. These persons are bound by contracts.
a. Assigns
b. Contracting parties
c. All of them
d. Heirs
4. These persons are bound by contracts. (Phil CPA, 85-2; 88-2)
a. Assigns
b. Heirs
c. Contracting parties
d. All of them
5. The person called to the succession either by the provision of the will or by operation of the law. (Phil
CPA, 94-2)
a. Trustor
b. Heir
 c. Legatee
d. Devisee
6. Eianne signed a promissory note in favor of Flor promising to pay P10,000 30 days after sight. Who can
sue on this note and enforce the obligation? (Phil CPA, 93-1)
a. Both Eianne and Flor
b. Only Flor
c. Neither Eianne nor Flor
d. Only Eianne

CONSENT – ASSESSMENT

1. Mr. Reyes and Mr. Vitug are good friends. Mr. Reyes sold and delivered his car to Mr. Vitug. It was
agreed and understood that on Sunday Mr. Reyes will name and fix the price of the car. Sunday came.
Mr. Reyes called Mr. Vitug by telephone and stated and fixed the price at P150,000. Is the sale
perfected? (Phil CPA, 89-1)
a. No. At the time of the sale, the price is not fixed.
b. No. The price was left to the discretion of the seller.
c. No. The price fixed by the seller was not accepted by the buyer
d. Yes. The price was stated and fixed on the date agreed upon.
2. Consent is manifested by the meeting of the offer and the acceptance upon the thing and the cause which
are to constitute the contract. Which of the following constitutes an offer: (Phil CPA, 91-1)
a. An offer made through an agent
b. Business advertisement of things for sale.
c. Advertisement for bidders.
d. Answer not given
3. Mrs. Gomez sold and delivered her diamond ring to Mrs. Pangan. It was agreed upon that after ten (10)
days Mrs. Pangan will name and fix the price. On the tenth (10th) day, Mrs. Pangan called up by
telephone Mrs. Gomez and stated the price at P10,000. Mrs. Gomez agreed. Is the sale perfected? (Phil
CPA, 88-2)
a. No. The price was left to the discretion of one of the parties.
b. No. At the time of the sale the price was not fixed
c. No. At the time of the sale the price is not known.
d. Yes. The price stated and named by one of the contracting parties was accepted by the other.
4. A wrote a letter to B wherein A offered to sell a piece of land to B for P200,000. B signified his desire to
buy the land. In A’s letter, B was given a period of two (2) months within which to produce the
P200,000. After 45 days, A told B that price of the land is now P250,000. Can B compel A to accept the
P200,000 first offered by A and execute the deed of sale? (Phil CPA, 88-1)
a. Yes, because A is already estopped by his signed letter.
b. No, for B did not signify his acceptance of A’s offer.
c. Yes, because there was actual meeting of the minds of the parties.
d. Yes, because the period of two (2) months has not expired.
5. S in Manila offered to sell to B in Cebu his house and lot for P10,000,000 giving the latter 60 days
within which to decide. B accepted the offer of S by a letter. While the letter was on its way to Manila, B
changed his mind and sent to S another letter withdrawing his acceptance 2 days after his first letter.
 a. B cannot anymore withdraw the first letter of acceptance specially if S has already received the
same.
b. B cannot anymore withdraw the first letter of acceptance.
c. B can withdraw the acceptance because such withdrawal was made before S received his first letter
of acceptance.
d. B can withdraw the acceptance even if S has already received his letter of acceptance.
6. On June 1, 2012, S offered to sell his only car to B for P100,000. B accepted the offer by mailing his
letter of acceptance of June 10, 2012. On June 12, 2012, B revoked his letter of acceptance and mailed
his letter of revocation on the same date. S received the letter of acceptance on June 14, 2012 and the
letter of revocation on June 15, 2012.
a. The perfection of the contract retroacts to June 1, 2012 when the offer was made.
b. The contract was perfected on June 10, 2012 when B sent his letter of acceptance.
c. The contract was not perfected because at the time the acceptance was received, the parties were no
longer of one mind.
d. The contract was perfected on June 14, 2012 when S received B’s letter of acceptance.
7. Three of the following are option money. Which is the earnest money? (Phil CPA, 89-2)
a. Given when contract of sale is perfected.
b. Given when there is no contract of sale
c. Given as a separate consideration from purchase price.
d. Given to bind the offer or in a unilateral promise to sell or buy.
8. S offered to sell his house and lot to B for P5,000,000 giving to him an option of 60 days within which
to decide whether or not to buy. After only 15 days, S met T who offered to buy the same house and lot
for P8,000,000. S then notified B of the withdrawal of the option and proceeded to sell to T. B files an
action for damages against S.
a. B can recover damages from S because the latter violated the option given to the former.
b. B can recover damages from S if B gave S option money which will result in a perfected contract of
sale.
c. B cannot recover damages from C because his option is without consideration as something paid or
promised.
d. Correct answer not indicated
9. Mr. A. Santos signed a letter addressed and delivered to Mr. S. Aguas. The terms of the letter are:
• An offer to sell a 500 sq. m. lot for P300,000.00.
• An option time up to October 31, 1991 for Mr. S. Aguas to raise the P300,000.00.
• Upon payment of the P300,000.00, Mr. A. Santos will execute and sign a Deed of Sale.

On October 31, 1991, Mr. A. Santos sent a letter to Mr. S. Aguas asking for a new price of P350,000.00
for the 500 sq. m. lot. Can Mr. S. Aguas compel Mr. A. Santos to accept the P300,000.00 and make him
sign and execute a Deed of sale? (Phil CPA, 92-2; 96-1 (name modified))

a. Yes. Mr. A. Santos is already estopped by his signed letter and offer
b. No. Mr. S. Aguas did not accept the offer of Mr. S. Santos
c. Yes. The contract is perfected
d. Yes. There was actual meeting of the minds
10. When there is concurrence of offer and acceptance, there is:
a. Payment
b. None of the above
 c. Revocation
d. Consent
11. Mr. Santos offered to sell his land to Mr. Calma for P100,000. Mr. Calma accepted the offer and paid
Mr. Santos P100,000and Mr. Santos delivered the owner’s duplicate of the Transfer Certificate of Title
of the land. Mr. Calma wishes to register the land in his name but the Register of Deeds asked Mr.
Calma for the Deed of Sale. What can Mr. Calma do? (Phil CPA, 88-2)
a. Mr. Calma may occupy and use the land as a buyer in good faith.
b. Mr. Calma may sue Mr. Santos to return the price under the legal maxim “No one may enrich
himself at the expense of another.”
c. Mr. Calma cannot compel Mr. Santos to return the payment because the contract is not enforceable.
d. Mr. Calma may compel Mr. Santos to execute the Deed of Sale because the contract is valid.
12. Mr. AB offered in writing to sell his house and lot for P750,000 to Mr. CD on July 1, 1989. Mr. CD
requested Mr. AB to give him 60 days within which to raise the P750,000. On August 15, 1989 Mr. AB
informed Mr. CD that the price is raised and now at P1,000,000. Can Mr. CD compel Mr. AB to sell his
house and lot at P750,000 which was offered in writing by Mr. AB? (Phil CPA, 90-1)
a. Yes, because there was already meeting of the minds.
b. No, because Mr. CD has not accepted the offer of Mr. AB.
c. Yes, because Mr. AB is already estoppel by his written offer.
d. Yes, because the 60 days offer has not yet expired.
13. S offered to B the sale of his house and lot for 10,000,000 by means of a letter. At the same time, B
offered to buy from S the same house and lot by way of telegram for P10,000,000 also. B has received
the offer of S and S has also received the telegram of B. Is there a perfected contract of sale between S
and B?
a. Correct answer not given.
b. No, because the house and lot being an immovable to perfect the contract it must be in a public
document.
c. Yes, because the essential elements are all present, namely: consent, object and consideration.
d. No, because what occurred was not a concurrence of offer and acceptance but a crisscrossing of
offers.

OBJECT OF CONTRACTS – ASSESSMENT

1. Three (3) of the following may be valid objects of a contract, except: (Phil CPA, 89-2)
a. All rights that are transmissible.
b. All that are within the commerce of man.
c. Impossible things or services
d. All services which are not contrary to law.
2. A has a daughter B; X has a son Y. A, B, X and Y agree together that Y will marry B. The agreement is
oral. If B latter on refuses to marry Y who has spent for the necessary wedding preparations and X and Y
bring an action against A and B, will the action prosper? Decide: (Phil CPA, 87-2)
a. The action of X and Y against A and B will prosper because the agreement is based on the
consideration of marriage other than mutual promise to marry.
b. As to A and X, the action will not prosper because the agreement is not enforceable as it was not
they who mutually promised to marry each other.
 c. Between Y and B, the action will not prosper because the agreement is made orally.
d. In case of A and X, the action will prosper because the agreement which was made orally is
enforceable as is based on the consideration of marriage.
3. Requisites of a valid object or subject matter:
a. None of them
b. Must be possible
c. Both a and b
d. Must be determinate or definite as to its kind
4. Mr. Gambino owes Mr. Eglesia P100,000. Gambino knows that on maturity date, he will not be able to
pay Eglesia, and in order to prevent attachment of his property by Eglesia, Gambino, before maturity of
his debt, executes a contract pretending to sell to Mr. Santos his property. Which of the following
statements is not correct? (Phil CPA 95-2)
a. The contract is binding between Gambino and Santos
b. The contract is not valid for lack of consideration
c. Mr. Eglesia can seek rescission of the fictitious contract.
d. The contract being simulated and executed to defraud Eglesia to void.
5. Valentina orally promised to many Pedro as consequence of which the latter contracted the Manila
Cathedral as the venue of the marriage, the whole of the Fiesta Pavilion of the Manila Hotel the bridal
gown to be made by Pitoy Moreno, spending all in all about P1,000,000. On the date of the marriage,
Valentina did not appear:
a. Pedro can legally compel Valentina to marry him.
b. Pedro cannot compel Valentina to pay damages because the mutual promise to marry was oral.
c. While Pedro cannot compel Valentina to marry him, he can collect from Valentina damages.
d. Pedro can neither collect damages from Valentina nor compel her to marry him.
6. Requisites of a valid cause:
a. It must be true
b. It must be lawful
c. All of them
d. It must be real

CONSIDERATION OF CONTRACTS – ASSESSMENT

1. Three of the following are void contracts. Which is the exception?
a. contracts to prevent a known supporter of a political rival from voting for his candidate for a
valuable consideration.
b. contracts where the cause is immoral.
c. contracts with valid consideration but with unlawful motives.
d. absolutely simulated contracts.
2. Mr. Santos sold his car to Mr. Garcia for P150,000. No date is fixed by the parties for the performance of
their respective obligations. The obligation of Mr. Santos is: (Phil CPA, 88-1)
a. To deliver the car within a reasonable time after the demand of Mr. Garcia to deliver.
b. To rescind the contract since there is no time fixed for the delivery and payment of the car.
c. To deliver the car upon the payment by Mr. Garcia of P150,000.
d. To deliver the car immediately as there is a perfected contract.
3. X, after the death of his father, sold his inheritance though its amount has not yet been determined to B,
for a consideration of P50,000.
a. Contract is void, future inheritance cannot be the object of sale.
b. The contract is valid only if the inheritance valued at least equal or more than P50,000.
c. The contract is rescissible.
d. The contract is void if nothing remains of the inheritance to be turned over to B.
4. Mr. Gamboa sold his car for P200,000 to Mr. Ramos. There was no fixed date for the performance of the
obligations of both parties. The obligation of Mr. Gamboa as vendor is: (Phil CPA, 97-2)
a. To deliver the car after Mr. Ramos demands for its delivery.
b. To wait for Mr. Ramos to pay P200,000 and deliver the car.
c. To rescind the contract because no time or date is fixed for the performance of their
respective obligations
d. To deliver the car immediately as this is a perfected contract.
5. O agreed to transfer to I, verbally, a residential lot in consideration of a service or benefit already
rendered by the latter in favor of the former. Which of these is correct?
a. The transaction is covered by the Statute of Fraud because it involves the sale of real property or any
interest therein.
b. The verbal agreement is enforceable because it is not covered by the Statute of Fraud.
c. The agreement being verbal involving real property is unenforceable and therefore cannot be sued
upon in court.
d. The law requires the agreement to be in writing at least since it involves real property.
6. P.A.U sold to R.D.E the former’s car on April 1, 1992 for P300,000. P.A.U. promised to deliver the car
on April 15, 1992 but A.D.E. did not make any promise as to when to pay. (Phil CPA, 92-1)
a. A.A.U. cannot demand payment until he delivers the car.
b. R.D.E. can compel P.A.U. to deliver the car before April 15, 1992 upon payment of the selling price.
c. R.D.E. will be obliged to pay only at or after delivery.
d. P.A.U. on April 5, 1992 can demand payment from R.D.E. because the obligation is not subject to
any condition.
7. X sold his car to Y for P50,000. No date was fixed for the performance of the obligations of the seller
and the buyer. The obligation of X is: (Phil CPA, 86-2)
a. To deliver the car after Y pays X the P50,000.
b. To rescind the contract because there is no time fixed for the delivery
c. To deliver the car immediately because the sale is a perfected contract.
d. To deliver the car only after Y writes to X demanding the delivery of the car.
8. Mr. Guzman sold his owner type jeep to Mr. Montano for P100,000. There was no date fixed for the
performance of the obligation of Mr. Guzman and Mr. Montano. The obligation of Mr. Guzman is: (Phil
CPA, 89-1)
a. To deliver the jeep after Mr. Montano demands for the delivery of the jeep.
b. To wait for Mr. Montano to pay P100,000 and deliver the jeep.
c. To deliver the jeep immediately as there is a perfected contract.
d. To rescind the contract because no time or date is fixed for the performance of the respective
obligations.

FORMALITIES OF CONTRACTS – ASSESSMENT

1. A loan for P800 was orally contracted. May the lender recover the sum lent?
a. No, because the contract is unenforceable.
b. Yes, if the debtor ratifies the loan.
c. Yes, because the contract is enforceable.
d. No, because the contract must be in writing to be valid.
2. X alleged that Y promised to give X one hectare of land. This is in consideration of X’s meritorious
service to Y. Y pleads in defense that since the promise was not in writing, it is unenforceable under the
Statute of Frauds. Decide. (Phil CPA, 87-2)
a. To deliver the car only after Y writes to X demanding the delivery of the car.
b. To rescind the contract because there is no time fixed for the delivery
c. To deliver the car immediately because the sale is a perfected contract.
d. To deliver the car after Y pays X the P50,000.
3. These novations take place automatically or by operation of law. Choose the exception:
a. Where a third person who has an interest in the obligation makes payment to the creditor.
b. None of the above.
c. Where a creditor pays another creditor who is preferred.
d. Where a third person who has no interest in the obligation makes payment with the consent of the
debtor.
4. Three of the following contracts must be in writing to be valid. Which is the exception?
a. Contract where the amount involved exceeds five hundred pesos.
b. Negotiable instruments.
c. Contract of partnership where immovables are contributed.
d. Contract of agency to sell the land of the principal.
5. X enter into a contract with Y whereby X sold his land orally to Y. The land has been delivered and the
money has been paid. Is the oral sale of the land valid? (Phil CPA, 87-2)
a. The contract is unenforceable
b. The contract is not valid because the contract is not in public instrument.
c. The contract is valid because the contract is already perfected and executed.
d. The contract is not valid because it is not in writing as required by the Statute of Frauds.
6. In a written contract of sale between S and B the true intention of the parties was not incorporated due to
the mistake of S but where B is innocent. Assume that there was a meeting of the minds between S and
B. Who can bring the action for reformation?
a. S only
b. B only
c. Both B and S
d. Neither B nor S
7. Statement 1: S orally sold to B a piece of land P1,000,000 where the latter made a down payment of
P500,000 to the former, B can compel S to execute a public document containing the sale.
Statement 2: In reformation of contracts, where the mistake, fraud or accident prevented a meeting of
the minds, the remedy remains to be reformation and not annulment.
a. Both statements are true.
b. Statement 1 is true, but statement 2 is false.
c. Both statements are false.
d. Statement 1 is false, but statement 2 is true.
8. A sold a residential land to B. B paid the consideration. When B wanted to register the sale at the
Register of Deeds, the latter refused to register it and required the presentation of the certificate of
capital gains tax payments. What can B do? (Phil CPA, 92-1; 96-1)
a. B cannot compel A to return the selling price because the contract is not enforceable.
b. B may compel A to pay capital gains tax and secure the Certificate of Capital Gains Tax payment.
c. B my possess the residential land as a buyer in good faith.
d. B may sue A to refund the consideration paid by B under the maxim “no one shall enrich himself at
the expenses of another.”
9. Mr. Burgos sold a parcel of land to Mr. Javier for P200,000. Mr. Burgos delivered the transfer Certificate
of Title of the land to Mr. Javier. Later, Mr. Javier wanted to registers the land to his name and he needed
a Deed of Sale. What can Mr. Javier do? (Phil CPA, 89-1)
a. Mr. Javier can sue Mr. Burgos for enriching himself at the expense of another.
b. Mr. Javier cannot compel Mr. Burgos to refund the P200,000 because the contract is not enforceable.
c. Mr. Javier can posses and utilized the land as a buyer in good faith.
d. Mr. Javier can compel Mr. Burgos to execute Deed of Sale
10. Which of these is a formal contract?
a. Both of (a) and (b)
b. Donation of real property
c. None of (a) and (b)
d. A partnership where there is contributed real property

INTERPRETATION AND REFORMATION OF CONTRACT – ASSESSMENT

1. Which of these is not subject to reformation?

a. All of the above
b. Last wills and testaments
c. Contract where the real agreement is void.
d. Simple donations inter vivos where no conditions are imposed.
2. Which of the following instrument is not subject to reformation?
a. Wills
b. Simple donation inter vivos wherein no condition is imposed
c. When the real agreement is void
d. All of the above
3. Which of the following is not a rule in the interpretation of contracts? (Phil CPA, 87-1)
a. Words which may have different significations shall be understood in that which is most in keeping
with the nature and object of the contract.
b. Although the cause is not stated in the contract, it is presumed that it exists and is lawful, unless the
debtor proves the contrary.
c. In order to judge the intention of the contracting parties, their contemporaneous and subsequent acts
shall be principally considered.
d. If some stipulation of any contract should admit of several meanings, it shall be understood as
bearing that import which is most adequate to render the contracts effectual.
4. There shall be no reformation of contract in the following cases, except: (Phil CPA, 96-2)
a. In testamentary wills
 b. Simple donation intervivos with no condition being imposes
c. A contract of sale fraudulently made as a contract of lease
d. When the real agreement is void
5. Cecilio had Ricardo kidnapped and tortured Eduardo for refusing to sell his (Eduardo’s) laid to Cecilio.
Eduardo who could no longer bear the physical pains inflicted upon him signed a document of sale in
favor of Cecilio. This sale is: (Phil CPA, 91-2)
a. Answer not given
b. Void
c. Voidable
d. Valid
6. Which of the following contracts may be cured by reformation?
a. Simple donation inter vivos with no condition being imposed.
b. Wills and testament
c. When the real agreement is void.
d. A Contract of Mortgage fraudulently made as a Contract of Sale

DEFECTIVE CONTRACTS – ASSESSMENT

1. To defraud his creditors, A contracted B by selling a land to B. B now seeks to register the land with the
Register of Deeds. X a creditor of A seeks to prevent the registration on the ground that the contract is
rescindable. Despite X’s objection may the land be registered based on the contract in B’s name. (Phil
CPA, 87-2)
a. The land can be registered because the contract is valid and can be attacked collaterally in a land
registration proceeding.
b. The land can be registered based on the contract because the contract is not yet rescinded.
c. The land cannot be registered based on the contract which is rescindable
d. The land cannot be registered because the contract is in fraud of creditor.
2. S and B entered into a contract of sale of a piece of land embodied in a public document on March 14,
2002. On July 20,2002, the said public document was registered with the Register of Deeds. On
December 15, 2002, B discovered that he was defrauded by S. The prescriptive period for the filing of
the action for annulment shall be counted;
a. Within four (4) years from July 20, 2002 or the date of registration with the Office of the
Registration of Deeds;
b. Correct answer not given.
c. Within four (4) years from March 14, 2002 or the date of the contract;
d. Within four (4) years from December 15, 2002 or the date of actual discovery of the fraud by B;
3. Which of these constitutes fraud?
a. The usual exaggeration in trade if the other party had an opportunity to know the facts.
b. A misrepresentation made in good faith.
c. An expression of opinion which did not turn out to be true if made by an expert and the other party
relied on it.
d. Failure to disclose facts when there is no duty to reveal them.
4. The following, except one, are the characteristics of void or inexistent contract. Which is the exception?
(Phil CPA, 93-2)
a. The right to raise defense of illegality cannot be waived.
b. The action or defense for declaration of the nullity or inexistence of the contract does not prescribe.
c. The defense of illegality of the contract is available to third persons whose interest is not directly
affected.
d. They are not subject to ratification
5. The proper remedy is annulment of contract and not reformation when: (Phil CPA, 91-1)
a. Answer not given.
b. One party was mistaken and the other knew or believed that the instrument did not state their
agreement, but concealed the fact from the former.
c. A mutual mistake of the parties causes the failure of the instrument to disclose their real agreement.
d. Mistake, fraud, inequitable conduct, or accident has prevented a meeting of the minds of the parties.
6. An agreement in restraint of trade:
a. Void
b. Unenforceable
c. Perfectly valid
d. Voidable
7. The following agreements are covered by the Statute of Fraud. Choose the exception.
a. An oral agreement which by its terms is not to be performed within one year from the making
thereof.
b. An oral special promise to answer for the debt, default or miscarriage of another.
c. An oral contract of partnership where the contribution in money or personal property amounts to
P3,000 or more
d. An oral agreement in consideration of marriage.
8. When one of the parties to a contract is compelled to give his consent by a reasonable and well grounded
fear of an imminent and grave evil upon his person or property, or upon the person or property of his
spouse, descendants or ascendants, there is: (Phil CPA, 91-1)
a. Undue influence
b. Violence
c. Intimidation
d. Answer not given
9. Contracts entered into during lucid interval are: (Phil CPA, 89-2)
a. Answer not given
b. Unenforceable
c. Void
d. Voidable
10. Contracts entered into a state of drunkenness or during a hypnotic spell are:
a. Void
b. Valid
c. Legal
d. Voidable
11. S and B agreed on the sale of a certain amount of opium for the total price of P1,000,000. Which of
these statements is correct?
a. If S had delivered the opium, and B does not pay him, he cannot ask for the return of the opium.
 b. The opium and the consideration of P1,000,000 shall be confiscated by the government.
c. If B had paid the P1,000,000 and S does not deliver the opium, he cannot recover the price paid.
d. All of the above.
12. A voidable contract:
a. Contract where consent is given through undue influence
b. Contract agreed to in state of drunkenness
c. All of the above
d. Contract agreed to during hypnotic spell
13. M, minor, owns a house and lot valued at P1,000,000 and G is his guardian , M sold said house and lot
to B, a capacitated person, for P600,000 in a private writing. The contract between M and B is:
a. Valid
b. Voidable
c. Rescissible
14. Which of the following contracts is not void ab initio? (Phil CPA, 97-2)
a. That which contemplates an impossible service
b. That whose object is outside the commerce of men.
c. That which is undertaken is fraud of creditors.
d. That whose object did not exist at the time of transaction.
15. Three (3) of the following contracts are void. Which is not? (Phil CPA, 92-2)
a. Oral partnership agreement where immovable property is contributed
b. Oral partnership agreement when capital is more than P3,000.00
c. Oral authority given to an agent in sale of land
d. Contract in writing contemplating and asking for impossible service
16. The action to annul a voidable contract, such as a contract where one of the parties is incapable of giving
consent to the contract is extinguished by: (Phil CPA, 91-1)
a. Novation
b. Rescission
c. Ratification
d. Answer not given
17. This results in the ratification of a contract violative of the Statute of Fraud:
a. Receipt of benefits under the agreement.
b. Both (a) and (b)
c. None of (a) and (b)
d. Failure to object to the presentation of evidence proving the oral agreement.
18. One of the parties to a contract is unemancipated:
a. Voidable
b. Rescissble
c. Unenforceable
d. Void
19. An oral sale of land for P500,000.
a. Voidable
b. Unenforceable
c. Rescissible
d. Void
20. A guardian of B sold B’s house and lot worth P480,000 for P240,000. (Phil CPA, 87-2)
 a. The contract cannot be rescinded because it is expressly provided by law as one of the contract
cannot be rescinded.
b. The contract cannot be rescinded because there is no fraud, mistake or undue influence.
c. The contract cannot be rescinded because all elements of contract are present.
d. The contract can be rescinded because of inadequacy of price.
21. The least defective contract:
a. Unenforceable contract
b. Void contract
c. Rescissible contract
d. Voidable contract
22. In order that fraud may make a contract voidable: (Phil CPA, 87-1)
a. It should be serious and should not have been employed by both contracting parties.
b. It should be serious and the parties must be in pari delicto
c. It may be incidental but both parties should not be in pari delicto.
d. It may be incidental but should have been employed by both parties.
23. On September 1, 1987, A entered into a contract with B, whereby A sells to B 5,000 sacks of sugar to be
delivered on the 15th and to be paid in full on the 30th. There was no agreement for rescission based on
non-payment. A did not deliver on the 15th but on the 30th he was willing and offering to deliver. But B
did not make payment on said date and so A did not like and refused to make the delivery. Decide. (Phil
CPA, 87-2)
a. A can rescind the contract for nonpayment of the price.
b. B is not entitled to recover damages.
c. A cannot rescind the contract for nonpayment of the price.
d. A cannot refuse to deliver the goods.
24. The guardian of an insane person sells a house and lot belonging to the latter valued at P100,000 to B,
buyer for P74,000 with the approval of the court. The contract is: (Phil CPA, 97-1)
a. Rescissible
b. Unenforceable
c. Valid
d. Voidable
25. A deaf-mute who knows how to write enters into a contract with an insolvent person after his discharge,
the contract is:
a. Voidable
b. Rescissible
c. Valid
d. Unenforceable
26. The following is considered fraud or fraudulent: (Phil CPA, 90-1)
a. Misrepresentation made not in bad faith.
b. Failure to disclose facts when there is duty to reveal them.
c. “Caveat Emptor” or let the buyer beware.
d. The usual exaggeration in trade, when the other party had the opportunity to know the facts.
27. Rescission of contract can take place in this case: (Phil CPA, 93-1; 97-1 )
a. When the seller cannot return the installments paid to him by the buyer.
b. When the things which are the object of the contracted are legally in the possession of third persons
who acted in bad faith.
 c. When he demands rescission can return whatever he may be obliged to restore.
d. When the party seeking resolution can perform only as to part and rescind as to remainder.
28. Which of the following contracts is valid? (Phil CPA, 97-2)
a. Oral contract of agency giving authority to an agent to sell the land belonging to the
principal.
b. Oral partnership agreement where immovable property in contributed.
c. Oral agreement to answer all expenses for the wedding reception if A marries B.
d. Oral contract of sale of an immovable property entered into by an agent who was given authority
orally by the principal.
29. A and B who are both unemancipated minors entered into a contract. The contract entered into by and
between them is: (Phil CPA, 87-1)
a. Voidable
b. Unenforceable
c. Void
d. Rescissible
30. Three (3) of the following contracts are void. Which one is not? (Phil CPA, 89-2)
a. Written contract contemplating impossible services.
b. Oral contract of Partnership where real estate is contributed as capital.
c. Agent’s authority to sell property given orally.
d. Oral contract of Partnership of three (3) partners and capital contribution is more than P3,000 in
cash.
31. Andy is the representative of Babes, an absentee sells a house and lot valued at P100,000 for only
P60,000. The contract is: (Phil CPA, 97-1)
a. Voidable
b. Valid
c. Rescissble
d. Unenforceable
32. On July 15, 1986, X entered into a contract with Y. On February 10, 1987, X discovered that fraud was
committed at the time he entered into the contract a fraud that vitiated his consent. The action for
annulment shall be brought. (Phil CPA, 87-2)
a. Within three years from the time of the fraud.
b. Within four years from February 10, 1987
c. On February 10, 1987
d. Within four years from the time A entered into the contract.
33. Mr. Esguerra, a former government employee, suffered from severe paranola and was confined in the
mental hospital in 1981. After his release he was placed under the guardianship of his wife to enable him
to get retirement pay. In 1984 he became a mining prospector and sold some mining claims. In 1987 he
sued to annul the sale claiming that he was not mentally capacitated at the time of sale. The sale in
question was: (Phil CPA, 93-1; 97-1)
a. Voidable
b. Illegal
c. Void
d. Valid
34. Which of the following contracts is not void ab initio?
a. The contract which is relatively simulated or fictitious.
 b. The contract whose cause, object or consideration is against the law, morals, good customs or public
order.
c. The contract where the object is beyond the commerce of man.
d. The contract where the intention of the relative to the object thereof cannot be ascertained.
35. Contracts which cannot be sued upon unless ratified, thus it is as if they have no effect yet, are: (Phil
CPA, 97-2)
a. Unenforceable
b. Voidable
c. Rescissible
d. Void
36. The stipulation in a contract to the effect that the debtor should remain as a servant in the house and in
the service of her creditors so long as she had not paid her debt, is void because it is: (Phil CPA, 91-1)
a. Answer not given.
b. Contrary to law and morality
c. Contrary to public policy
d. Contrary to good customs
37. Factor vitiating consent
a. Dolo incidente
b. CULPA
c. MORA
d. Dolo causante
38. M is minor who owns a house and lot valued at P1,000,000. G is the guardian who sold the house and
lot to B for only P600,000 but with the approval of the court. The contract between G and B is ?
a. Rescissible;
b. Unenforceable
c. Voidable;
d. Valid;
39. F disappeared without his whereabouts having been known sometime in 1994. Whereupon in 1996, W,
his wife, sold his house and lot worth P10,000,000 for only P7,000,000 in favor of T in order to support
the family. In 1998, F resurfaced and began staying with his family. In 2003, F decided to file an action
to rescind the contract with T. In this case:
a. Correct remedy not indicated.
b. If F can return the P7,000,000 to T and the house and lot has not been sold to a buyer in good faith,
he can validly ask for rescission.
c. Even if F can return the P7,000,000 and the house and lot has not been sold to a buyer in good faith,
rescission will not lie because more than 4 years had lapsed from the reappearance and, therefore, his
right to rescind has already prescribed.
d. The contract of W with T is valid and, therefore, rescission will not be available as a remedy.
40. S offered to sell to B his house and lot for P10,000,000. In order to pressure B into buying said house
and lot, T, a very good friend of S, threatened B with death as a result of which B accepted the offer of
S. It turns out now that the market value of the house and lot is P15,000,000. Is the contract of S and B
valid?
a. It is not B but S or T who can file the action for annulment.
b. The contract is voidable because the consent given by B is anyway vitiated even if the intimidation
was employed by a third person.
 c. The issue of the contract being voidable is not relevant because B will not have the contract
avoidable because it is actually favorable to him.
d. The contract is valid since it is very clear that S did not apply the intimidation.
41. In which of these cases will the Statute of Fraud not apply?
a. All of the above
b. An oral mutual promise to marry, not to compel marriage but only to recover damages.
c. An oral contract of lease of real property for twelve months.
d. O orally conveys to L a piece of land for benefits or services already rendered.
42. Contracts entered into a state of drunkenness or during a hypnotic spell are: (Phil CPA, 93-1; 97-1)
a. Legal
b. Voidable
c. Valid
d. Void
43. A intimidated B to marry A’s daughter. After a year, B would like to file action for annulment but could
not do so because A was around to intimidate him. The marriage contract is: (Phil CPA, 93-2)
a. Rescissible
b. Unenforceable
c. Voidable
d. Void
44. In order that fraud may make a contract voidable: (Phil CPA, 94-2)
a. It may be incidental but should have been employed by both parties.
b. It may be serious and the parties must be in pari delicto.
c. It may be incidental but both parties should not be in pari delicto
d. It should be serious and should have not have been employed by both contracting parties.
45. S sometime in 1996 sold to B a house and lot where the former committed fraud. The deed of sale which
was in a public document was registered with the Register of Deeds in 1997. In 1999, the fraud was
discovered by the heirs of B. Under the Law, the action to annul a contract based on fraud must be filed
within four (4) years from:
a. 1996 the date of the contract
b. 1997 the date of registration with the Register of Deeds.
c. 1999 the date the fraud was discovered.
d. The action to annul a contract based on fraud is not subject to prescription.
46. The process of intentionally deceiving others by producing the appearance of a contract which is
different from the true agreement is: (Phil CPA, 96-2)
a. Misrepresentation
b. Fraud
c. Relative simulation of a contract
d. Absolute simulation of a contract
47. Reluctantly and against her good sense and judgment, Rosemarie entered for the delivery of 5 tables to
Corazon for a price of P15,000. Contract is: (Phil CPA, 93-1; 97-1)
a. Unenforceable
b. Void
c. Valid
d. Voidable
48. In a written contract the true intention of the parties was not reflected therein through the fraud
committed by one of them, which fraud prevented a meeting of the minds. The applicable remedy would
be
a. A petition for the declaration of nullity of the contract
b. Annulment of the contract
c. Reformation of the contract
d. Resolution of the obligation
49. S defrauded B in making the latter believe that the ring he is selling is gold and diamond when, in fact, it
is copper and glass. On the other hand, B defrauded S in paying him P200,000 in fake Philippine
currency. Which of these statements is correct?
a. S can go to court for the annulment of the contract so that the ring will be returned to him.
b. All the statements are not correct.
c. Neither S nor B can go to court since they are both guilty of fraud.
d. B can go to court so that his fake money will be restored to him.
50. When the object of the contract is outside the commerce of man, the contract is: (Phil CPA, 86-2)
a. Void
b. Voidable
c. Unenforceable
d. Rescissible

51. Which is the least defective contract?

a. Voidable contract
b. Unenforceable contract
c. Rescissible contract
d. Void contract
52. An oral contract of guaranty:
a. Void
b. Voidable
c. Perfectly valid
d. Unenforceable
53. Statement 1: A contract whose cause or object did not exist at the time of the transaction is a defective
contract which cannot be remedied by providing a cause or object as the case may be in the contract.
Statement 2: The nullity of the accessory obligation or of the penal clause does carries with it the nullity
of the principal obligation which remains in force and demandable. Determine whether: (Phil CPA, 94-
1)
a. Both statement are false.
b. Statement I is true but statement II is false.
c. Statement I is false but Statement II is true.
d. Both statements are true
54. Which of the following contracts cannot be ratified? (Phil CPA, 87-1)
a. Those where both parties are incapable of giving consent.
b. Those whose cause or object did not exist at the time of the transaction.
c. Those that fail to comply with the Statute of Frauds.
d. Unathorized contracts
 NATURE, FORMS AND REQUISITES – ASSESSMENT

1. A thing can be considered determinate when

a. Is specific and is identified by its individuality
b. B and C are correct
c. Physically segregated from all others of the same class
d. It is standard and within the same classification
2. A contract of sale is
a. An agreement where ownership is reserved in the seller and not to pass until full payment of price
b. None of the above
c. Where title passes to the vendee upon delivery of the thing sold
d. Where full payment is a positive suspensive condition
3. Mrs. Lim agrees to sell his watch to Mr. Lomotan for P10, 000 in cash, and places the timepiece inside
the car of Mr. Lomotan, while he goes to an ATM to withdraw money. Before Mr. Lomotan returns, Mr.
Co arrives and claims ownership of the watch presenting a document signed by Mr. Lomotan
selling the time piece to him. Mrs. Lim discards the claim asserting that she is still the owner. In this
situation, who is the rightful owner of the watch?
a. Both Mrs. Lim and Mr. Lomotan owns the watch since their agreement is still incomplete
b. Mrs. Lim, because Mr. Lomotan has not yet paid the agreed price
c. Mr. Lomotan, since he & Mrs. Lim as already come into an agreement and there is actual delivery of
the watch from Mrs. Lim to Mr. Lomotan’s vehicle
d. Mr. Co, given that he has a written agreement between him and Mr. Lomotan
4. A contract whereby one of the contracting parties obligates himself to transfer the ownership of and to
deliver a determinate thing and the other to pay therefore a price certain in money or its equivalent is a
contract of:
a. Mortgage.
b. Dacion en pago.
c. Sale.
d. Barter.
5. The following are the characteristics of a contract of sale, except:
a. Onerous, where rights are acquired in exchange of a valuable consideration.
b. Principal, which means that a contract of sale can stand by itself.
c. Real, which requires the delivery of the object of the contract of sale for its perfection
d. Bilateral, which means that both parties are bound reciprocal to each other.
6. Ronald transferred to Vincent a parcel of land for the price of P15,000,000. It was stipulated in
the contract that Vincent will pay P5, 000,000 in cash and for the balance, we will give a boat, valued at
approximately P10, 000,000. What kind of contract is this?
a. None of the above
b. Contract of sale
c. Contract for a piece of work
d. Contract of barter
7. The following are examples of illicit things “by chance”n except
a. Expired medicine
b. None of the above
 c. Marijuana
d. Jueteng paraphernalia
8. As to the presence or absence of conditions, a sale may be
a. None of the above
b. Absolute
c. All of the above
d. Conditional
9. When is the price in a contract of sale can be considered certain?
a. All parties agreed on a specific amount
b. All of the above
c. Capable of being determined in money or its equal
d. When there is no specific amount specified, price is left to the judgement of a specified person or
persons
10. A contract of sale is except
a. Reciprocal
b. None of the above
c. Onerous
d. Nominate
11. Goods which form the subject of a contract of sale may be except
a. Future goods
b. None of the above
c. Illicit goods
d. Owned goods
12. The following are characteristics of a contract of sale aside from
a. Unilateral
b. Principal
c. Consensual
d. None of the above
13. Under the Statute of Frauds, the following contracts must be in writing, otherwise they cannot be
enforced in court litigation except
a. Sale of personal property at a price not less than P300.00
b. Sale of property not to be performed within a year from the date thereof regardless of the
nature of the property and price involved
c. None of the above
d. Sale of real property regardless of the price involved
14. Option money is explained by the statements below except
a. None of the above
b. No sale has been perfected
c. Buyers are not required to buy
d. Part of the purchase price
15. Effect of price fixed by third person can be considered void excepts
a. None of the above
b. Third person adhere to the instructions laid down by parties involve
c. Third person disregards data and parameters given by parties involve
d. Third person acts in bad faith
16. One has the right to transfer ownership if he/ she with the exception of
a. Was authorized by the owner
b. Is the owner
c. None of the above
d. Paid half of the total price
17. A sum of money paid or a thing deliverd upon the making of a contract for thesale of goods to bind the
bargain the delivery and acceptance of which makes the final assent of both parties to the contract
a. Down payment
b. Reservation money
c. Option money
d. Earnest money
18. The contract of sale must always have
a. Subject matter
b. Consideration
c. Consent
d. All of the above
19. Bo decided to buy a condominium in Bonifacio Global City and pays a reservation fee of P100,000. If
Bo is suddenly in a financial bind, is she still bound to pay the balance of her condominium after her
reservation?
a. All of the above
b. None of the above
c. Yes, because she already paid earnest money and is bound by it
d. No, because a reservation can be considered an option money for the reason that it may not be
refundable but it can be forfeited
20. Alabang Shoe Store Incorporated (ASSI) entered into separate contracts with 2 movie stars, Kimi and
Honesto. With Kimi, the agreement was that the shoe store shall deliver at a specified date for a price of
P2,000 a pair of shoes of a specified brand which the store had been manufacturing for the general
public but which at the time of the contract had already been sold out, and with Honesto, the
arrangement was that the shoe store shall deliver at a specified date for a price of P3,000 a pair of shoes
to be made specifically for him, in accordance with a design submitted by him.
What is the nature of the contract between Kimi and ASSI?
a. None of the above
b. Contract for a piece of work
c. Contract of barter
d. Contract of sale
21. Alabang Shoe Store Incorporated (ASSI) entered into separate contracts with 2 movie stars, Kimi and
Honesto. With Kimi, the agreement was that the shoe store shall deliver at a specified date for a price of
P2,000 a pair of shoes of a specified brand which the store had been manufacturing for the general
public but which at the time of the contract had already been sold out, and with Honesto, the
arrangement was that the shoe store shall deliver at a specified date for a price of P3,000 a pair of shoes
to be made specifically for him, in accordance with a design submitted by him.
What is the nature of the contract between Honesto and ASSI?
a. Contract for a piece of work
b. Contract of sale
c. Contract of barter
 d. None of the above
22. Bo decided to buy a condominium in Bonifacio Global City and pays a reservation fee of P100,000. Is
the reservation fee earnest money or option money?
a. Earnest money
b. Neither
c. Both
d. Option money
23. One of the following is not a requisite of the object of a contract of sale. Which is it?
a. It must be determinate or determinable.
b. It must be licit.
c. It must be within the commerce of men.
d. Vendor must have the right to transfer the ownership of the thing at the time of sale.
24. It refers to the money paid by the offeree to the offerer to bind the latter in case the offerer grants the
offeree the privilege to accept an offer within a certain period of time.
a. Option money
b. Deposit
c. Down payment
d. Earnest money
25. Pedro has a land under litigation and agrees to sell it to Renel for 500,000 if he wins the case and
recovers said property. When the verdict was given, Pedro’s case lost and was not able to recover his
property. Is Pedro required to provide a replacement property to be sold to Renel?
a. Yes, since he agreed to sell a property to Pedro
b. Yes, because they have an ongoing arrangement
c. No, for the reason that their agreement is only valid on a specific property
d. No, because their agreement is on the condition that he will only sell if he wins his the case
26. Earnest money means
a. Partial payment of the buyer to the seller
b. Proof of the perfection of the contract
c. All of the above
d. Bind between seller and buyer
27. What is an option contract?
a. It is a separate contract from that which the parties may enter into upon the consummation of the
option
b. It is and must be supported by consideration
c. All of the above
d. An agreement granting a privilege to buy or sell with an agreed time period and a determined price
28. Quezon Bed Company (QBC) granted to Happy Sleep Incorporated (HSI) the exclusive right to sell in
North Luzon a certain number of beds which the company was manufacturing at the invoice price of the
beds in Manila, with a discount of 20%, the price to be paid at the end of 60 days. What contract is
perfect here?
a. Contract of Agency
b. None of the above
c. Contract of Barter
d. Contract of Sale
29. A contract of agency to sell can be considered when
 a. None of the above
b. Receives the goods as the owner
c. Only accounts for the proceeds of the sale he/she may make on the principal’s behalf
d. Not bound to the instructions of the principal and cannot return object sold

EARNEST MONEY AS DISTINGUISHED FROM OPTION MONEY – ASSESSMENT

1. Option money is explained by the statements below except

a. None of the above
b. No sale has been perfected
c. Part of the purchase price
d. Buyers are not required to buy
2. A sum of money paid or a thing deliverd upon the making of a contract for thesale of goods to bind the
bargain the delivery and acceptance of which makes the final assent of both parties to the contract
a. Option money
b. Earnest money
c. Reservation money
d. Down payment
3. Bo decided to buy a condominium in Bonifacio Global City and pays a reservation fee of P100,000. Is
the reservation fee earnest money or option money?
a. Earnest money
b. Option money
c. Neither
d. Both
4. It refers to the money paid by the offeree to the offerer to bind the latter in case the offerer grants the
offeree the privilege to accept an offer within a certain period of time.
a. Down payment
b. Deposit
c. Earnest money
d. Option money
5. Earnest money means
a. Partial payment of the buyer to the seller
b. Bind between seller and buyer
c. Proof of the perfection of the contract
d. All of the above
6. Bo decided to buy a condominium in Bonifacio Global City and pays a reservation fee of P100,000. If
Bo is suddenly in a financial bind, is she still bound to pay the balance of her condominium after her
reservation?
a. No, because a reservation can be considered an option money for the reason that it may not be
refundable but it can be forfeited
b. None of the above
c. All of the above
d. Yes, because she already paid earnest money and is bound by it
 RIGHTS.OBLIGATIONS OF VENDOR AND VENDEE – ASSESSMENT

1. Contracts of sale or return can be considered when

a. Subject to a resolutory condition
b. All of the above
c. Depends on the mind of the vendee
d. The risk of loss is with the vendee
2. The principal obligations of the vendee are except
a. To maintain the unit pending delivery
b. Accept delivery
c. Pay the agreed price
d. None of the above
3. Which of the following statement is false
a. In a right to resell it is not necessary that the original buyer is insolvent
b. The price is considered certain if it is in reference to another thing certain
c. In contract to sell, ownership is not transferred to the buyer even if there is delivery
d. Stoppage in transitu can be exercised by the unpaid seller if the buyer is insolvent and the vendor has
not yet parted with the thing sold
4. Gelo sold his Honda Civic to Jules, who immediately paid the price. Because the vehicle was at the
repair shop at the time, the contract was perfected but no delivery was made. Before delivery could be
made, Anton, a creditor of Gelo, who has filed a suit against him, attached the car.
Between Gelo, Jules & Anton, who is the rightful owner of the Honda Civic, during the time of lawsuit?
a. Anton, because Gelo owes him money and the car is part of the payment
b. Jules, because he had already paid for the car
c. Gelo, because he technically can’t sell the car yet due to the lawsuit but still owns since the suit is
not yet final
5. The principal obligations of the vendor are
a. All of the above
b. To maintain with proper diligence the unit sold pending delivery
c. Transfer the ownership of the unit sold
d. Deliver the unit sold
6. This mode of legal delivery happens when the vendee has already the possession of the thing sold by
virtue of another title as when the lessor sells the thing leased to the lessee
a. Traditio tempore constitutum
b. Traditio brevi manu
c. None of the above
d. Traditio constitutum possessorium
7. This mode of delivery Is the opposite of traditio brevi manu. This takes place when the
vendor continues in possession of the property sold not as owner but in some other capacity.
a. Traditio tempore manu
b. None of the above
c. Traditio constitutum possessorium
d. Traditio longa manu
8. In Art. 1493, if at the time the contra ct of sale is already perfected but the thing sold was partially lost,
what options does the vendee have over the vendor?
 a. Vendee can demand damages from vendor due to the result of the loss
b. Vendee may withdraw from the contract with the vendor
c. None of the above
d. Vendee has no choice but to follow the contract since the thing was just partially lost
9. When goods are delivered to the vendee on ________________ to give him/her an option to return
goods instead of paying, the ownership passes to the buyer on delivery, but he/she may revest, the
ownership in the vendor by tendering the goods within the time fixed in the contract.
a. Sale on satisfaction
b. Sale or return
c. Sale on trial
d. None of the above
10. In Art. 1493, if at the time the contra ct of sale is already perfected but the thing sold was entirely lost?
What are the options of the vendee?
a. Vendee may withdraw from the contract with the vendor
b. Vendee can demand damages from vendor due to the result of the loss
c. Vendee has no option available because the contract shall be without any effect
d. None of the above
11. In Art 1490, a husband and wife, during marriage cannot
I. Donate property to each other
II. Sell property to each other
III. Borrow proper from each other
a. II and III are correct
b. III and I are correct
c. I and II are correct
12. In Art 1491, the following cannot acquire by purchase even at a public auction, either in person or
through the mediation of another, except
a. Agents who was given consent by the principal
b. Guardian
c. Public employees/ officers
d. Executors and administrators
13. The ownership of the thing sold shall be transferred from the vendor to the vendee upon delivery which
may be done by
a. Actual delivery
b. Legal delivery
c. Proof of agreement that possession is already transferred to the vendee
d. All of the above
14. Legal delivery is _________ when, to effect the delivery, the parties use a token to represent the thing
delivered
a. None of the above
b. Real
c. Actual
d. Symbolic
15. An unpaid seller’s right to resell the goods is available in the following cases, except:
a. When the seller has lost his lien on the goods.
b. If the goods are of a perishable nature.
 c. When the seller reserved the right to resell the goods.
d. When the buyer has defaulted in the payment of the price for an unreasonable time.
16. It is a contract by which property is sold but the buyer, who becomes the owner of the property on
delivery, has the option to return the same to the seller instead of paying the price.
a. Sale on approval
b. None of the above
c. Sale on trial
d. Sale on satisfaction
17. In Art 1490, a husband and wife, during marriage cannot sell property to each other except
a. When separation of property was not agreed in the marriage settlements
b. None of the above
c. Property is donated by the other half
d. When separation of property was agreed upon in the marriage settlements
18. What situations can be the buyer is exempted and in turn still acquire the object and claim ownership?
a. Where the true owner is estopped by his conduct from denying the vendor’s authority to sell
b. Where the purchase is made in a merchant’s store of markets, in accordance with the code of
commerce and special laws
c. Where the sale is made by the registered owner in accordance with registration laws
d. All of the above
19. What title is acquired by the buyer if the object which he bought was sold by someone who is not the
owner thereof and who was not authorized to sell it?
a. None of the above
b. The buyer in such a case still has the right to the object since he had no knowledge before
the contract was perfected
c. The buyer in such a case acquires and interim title to the object until the issue is resolved
d. The buyer in such a case acquires no better title to the object the vendor had
20. Gelo sold his Honda Civic to Jules, who immediately paid the price. Because the vehicle was at the
repair shop at the time, the contract was perfected but no delivery was made. Before delivery could be
made, Anton, a creditor of Gelo, who has filed a suit against him, attached the car.
What right has Jules over the Honda Civic?
a. Jules’s acquired a personal right over the car. However, such right has become useless because of the
attachment of the vehicle by Anton, a creditor of Gelo
b. Jules still owns and has right to the car since the contract was perfected before they were made
known of the suit

WARRANTIES (IN RELATION TO CONSUMER LAWS) – ASSESSMENT

1. This is not an essential element of a contract of sale

a. Subject matter which should be determinate
b. Consent of the contracting parties
c. Consideration which is certain or its equivalent
d. Warranty against eviction
2. These are common forms of document of title except
a. Bill of lading
 b. Dock warrant
c. Promissory memo
d. None of the above
3. This refers to the implied warranty on the part of the seller that he has the right to sell the thing at the
time when ownership is to pass, and that the buyer from that time shall have and enjoy legal and
peaceful possession of the thing.
a. Warranty against hidden defects.
b. Warranty of possession.
c. Warranty against eviction.
d. Warranty of ownership.
4. What are the implied warranties of the person who negotiates a document of title by delivery?
a. Has the legal to negotiate
b. Has the legal right to transfer
c. All of the above
d. Document is authentic or genuine

INSTALLMENT SALES – ASSESSMENT

1. In a contract of sale of personal property the price of which in payable in instalments, what are the
possible remedies available to the vendor in case of breach?
a. Demand completion of the of the obligation should the vendee fail to pay
b. All of the above
c. Foreclose chattel mortgage on the thing sold
d. Cancel the sale if vendee fails to pay more the 2 months instalment
2. Paul sold a second hand car to Trish for P150, 000. The deal between Paul and Trish was the 50% of the
purchase price, of P75,000, shall be paid upon delivery of the car
to Trish and the balance of P75,000 shall be paid in 3 equal monthly instalments of P25,000
each. The car was delivered to Trish, and she paid the amount of P75, 000 to Paul. Two weeks after, the
car was stolen from Trish’s garage with no fault on Trish’s part and was never recovered.
Is Trish legally bound to pay the unpaid balance of P75,000 to Paul?
a. No, because the car is not yet fully paid and in turn not yet owned by Trish
b. Yes, but not the whole amount since the thing sold was no longer in her possession
c. Yes, because ownership was already acquired by Trish the moment the car was delivered to her
d. No, because the contract was not perfected and the thing sold was partially lost
3. At a mortgage foreclosure, a sale was carried out as a result of a judicial proceeding.
Tessa, an attorney for the mortgage creditor, bought the mortgaged property.
If Tessa bought the property for her client, did she violate the absolute terms of Art.1491 of the NCC?
a. Yes, because it still violates the terms of Art. 1481
b. No, because she would be merely acting as agent of her client
c. None of the above
4. Mike sold a motorcycle to Powee for P50,000 to be paid as follows: P30,000 upon delivery of the
motorcycle to Powee, and the balance at the rate of P5,000 per month until paid in full. The motorcycle,
however, was burned in the possession of Powee without his fault, before the balance was paid in full. Is
Powee obliged to pay the balance?
a. No, given that the motorcycle is not yet fully paid and in turn still owned by Mike that make him
responsible for it
 b. Yes, given that the ownership was already transmitted to him upon delivery
c. None of the above
5. The Recto Law applies to which of the following examples of sale?
a. Sale of a piano on installments where the buyer constituted a chattel mortgage on the piano.
b. Sale of car on installment where the buyer constituted a mortgage on his truck.
c. Sale of a car on straight term.
d. Sale of house and lot on installment.
6. At a mortgage foreclosure, a sale was carried out as a result of a judicial proceeding.
Tessa, an attorney for the mortgage creditor, bought the mortgaged property. If she bought it for
herself, is the sale void or voidable?
a. Yes, because is it prohibited by the law
b. No, because her knowledge of the said foreclosure has no impact on the sale of the property
c. None of the above
7. One of the following is not an alternative remedy available to a seller of personal property on
installment if buyer defaults
a. To go to court and ask the court to order delivery of the property
b. To take possession of the property and forfeit the amount paid by the buyer
c. To sue for specific performance
d. To foreclose the chattel mortgage

1. The negotiable character of an instrument otherwise negotiable is affected by this provision which:
a. Waives the benefit of any law intended for the advantage or protection of the obligor
b. Authorizes a confession of judgment if the instrument be not paid at maturity
c. Gives the maker an election to require something to be done in lieu of payment of money
d. Authorizes the sale of collateral securities in case the instrument be not paid at maturity

Which of the following is not a principal obligation of the mortgagor?

a. to pay any deficiency in case there is a balance due to the mortgagee after applying the proceeds of the
foreclosure sale;
b. to continue in the ownership and possession of the mortgaged property;
c. to respect the right of the mortgagee;
d. to comply with his obligations at the time stipulated;

A issues a bill payable to the order of B. Later B without endorsing the bill transfers for a consideration said bill
to C. The following except one, are the valid effects of the transfer.

a. C acquires the right to have the endorsement of B.

b. The bill is merely assigned and not negotiated.
c. C becomes a holder.
d. The transfer vests in C such title as B had thereon.
Nora mortgaged his farmland to Vilma. The farmland has a fair market value of P50,000 while the loan is only
P10,000. Thereafter, Nora sold the farmland to Boyet. What is the legal effect of the sale to Boyet.

a. Vilma may foreclose the property to protect her interest.

b. the sale is unenforceable as Nora was not authorized to sell the property;
c. the sale is void and Vilma may foreclose the mortgage in case of default by Nora;
d. the sale is valid but it does not affect the mortgage;

The following are the kinds of real estate mortgage, except;

a. voluntary mortgages;
b. contracts of sale with right of repurchase;
c. legal mortgages;
d. equitable mortgages;

A promissory note reads:

“I promise to pay to the order of B P10,000, 30 days after date”. Sgd. A
A issued the promissory note to B who indorsed it to C. Then X stole the note from C,
forged the signature of C and negotiated it to D and D to E and E to F, the holder.
Questions
:Q1 : Can F collect from A on maturity?
Q2: If after giving the proper notice of dishonor to all the parties secondarily liable, can
F collect from B?
a. First is correct, second is wrong
b. First is wrong, second is correct
c. Both answers are correct
d. Both answers are correct
DIVIDENDS - ASSESSMENT

1. Dividend in the form of a promissory note and may be issued to bear interest
a. Preferred dividend
b. Scrip dividend
c. Optional dividend
d. Composite dividend
2. Rod Bake Corporation posted a P1M profit in its realty business and its real estate has appreciated in
value in the amount of P4M despite the El Nino phenomenon that struck the northern and southern
Philippines. The board then declared dividends to its stockholders computed on the basis of 5M
representing profits and appreciation in value of its real state. Is the dividend declaration valid?
a. Valid if no creditors shall be prejudiced and approved by the required votes of the directors and
stockholders.
b. Not valid because dividends must only come from the unrestricted retained earnings.
c. Valid because it was based on profit and increment in the value of the corporate assets.
d. Not valid because there was no approval of 2/3 of the outstanding capital stock.
3. Stock dividends differ from cash dividend in that stock dividends
a. Once received by the stockholders, are beyond the reach of corporate creditors
b. Require the approval of both the board of directors and the stockholders
 c. Do not increase the legal capital
d. Involves the disbursement of corporate funds
4. The following are the requisites except one, for valid declaration and/or issuance of stock dividend.
a. It is issued to increase the authorized capital.
b. Existence of the original and unissued shares;
c. Existing unrestricted retained earnings;
d. Dividends declaration by the Board of Directors and approved by 2/3 vote of the outstanding capital
stock;
5. Dividend which gives the stockholder an option to receive cash or stock dividend
a. Liquidating dividend
b. Cumulative dividend
c. Optional dividend
d. Bond dividend
6. Dividend which are actually distributions of the assets of the corporation upon dissolution or winding up
a. Cumulative dividend
b. Bond dividend
c. Preferred dividend
d. Liquidating dividend
7. Dividend which is partly in cash and partly in stocks
a. Optional dividend
b. Composite dividend
c. Cumulative dividend
d. Liquidating dividend

ORGANIZATION AND REGISTRATION OF COOPERATIVES - ASSESSMENT

1. A cooperative may be organized and registered for any or all of the following purposes, except:
a. To generate funds and extend credit to the members for productive and provident purposes;
b. To encourage among members systematic production and marketing;
c. None of the choices
d. To encourage thrift and savings mobilization among the members;
2. Every cooperative shall conduct its affairs in accordance with Filipino culture, good values and
experience and the universally accepted principles of cooperation which include, but are not limited to,
the following, except:
a. Bureaucratic Member Control
b. Member Economic Participation
c. Voluntary and Open Membership
d. Autonomy and Independence

ADMINISTRATION – ASSESSMENT

1. Statement 1: The general assembly shall be the highest policy-making body of the cooperative and shall
exercise such powers as are stated in the Cooperative Code, in the articles of cooperation and in the
bylaws of the cooperative.
 Statement 2: The general assembly can delegate its power to determine and approve amendments to the
articles of cooperation and bylaws.
a. Only Statement 1 is true
b. Both statements are true
c. Only Statement 2 is true
d. Both statements are false
2. Statement 1: A regular meeting shall be held annually by the general assembly on a date fixed in the
bylaws, or if not so fixed, on any dated within ninety (90) days after the close of each fiscal year:
Provided, That notice of regular meetings shall be sent in writing, by posting or publication, or through
other electronic means to all members of record.
Statement 2: Whenever necessary, a special meeting of the general assembly may be called at any time
by a majority vote of the board of directors or as provided for in the bylaws: Provided, That a notice in
writing shall be sent one (1) week prior to the meeting to all members who are entitled to vote.
a. Both statements are false
b. Only Statement 2 is true
c. Only Statement 1 is true
d. Both statements are true

RESPONSIBILITIES, RIGHTS AND PRIVILEGES OF COOPERATIVES – ASSESSMENT

1. Cooperatives registered, notwithstanding the provisions of any law to the contrary, be also accorded the
following privileges, except:
a. Cooperatives shall enjoy the privilege of depositing their sealed cash boxes or containers, documents
or any valuable papers in the safes of the municipal or city treasurers and other government offices
free of charge, and the custodian of such articles shall issue a receipt acknowledging the articles
received duly witnessed by another person;
b. Cooperatives organized among government employees, notwithstanding any law or regulation to the
contrary, shall enjoy the free use of any available space in their agency, whether owned or rented by
the Government;
c. In areas where appropriate cooperatives exist, the preferential right to supply government institutions
and agencies rice, corn and other grains, fish and other marine products, meat, eggs, milk,
vegetables, tobacco and other agricultural commodities produced by their members shall be granted
to the cooperatives concerned;
d. Cooperatives not rendering special types of services and facilities such as cold storage, ice plant,
electricity, transportation, and similar services and facilities shall secure a franchise therefore, and
such cooperatives shall open their membership to all persons qualified in their areas of operation;
2. Statement 1: The accountant or the bookkeeper of the cooperative shall be responsible for the
maintenance of the cooperative in accordance with generally accepted accounting practices. He shall
also be responsible for audit or inspection.
Statement 2: Every cooperative shall have an official postal address to which all notices and
communications shall be sent. Such address and every change thereof shall be registered with the
Cooperative Development Authority.
a. Only Statement 2 is true
b. Both statements are false
 c. Only Statement 1 is true
d. Both statements are true

CAPITAL, PROPERTY OF FUNDS – ASSESSMENT

1. Statement 1: No member of primary cooperative other than cooperative itself shall own or hold more
than ten per centum (10%) of the share capital of the cooperative.
Statement 2: The bylaws of a cooperative may prescribe a fine on unpaid subscribed share capital.
Provided, that such fine is fair and reasonable under the circumstances.
a. Only statement 2 is true
b. Only statement 1 is true
c. Both statements are false
d. Both statements are true
2. Cooperatives registered under this Code may derive their capital from any or all of the following
sources, except:
a. Member’s share capital;
b. Loans and barrowings including deposits;
c. None of the choices
d. Revolving capital which consists of the deferred payment of patronage refunds, or interest on share
capital;
AUDIT, INQUIRY AND MEMBERS’ RIGHT TO EXAMINE – ASSESSMENT
1. Statement 1: The accountant shall submit to the board of directors and to the audit committee the
financial audit report which shall be in accordance with the generally accepted auditing standards for
cooperatives as jointly promulgated by the Philippine Institute of Certified Public Accountants (PICPA)
and the Cooperative Development Authority.
Statement 2: Performance and social audit reports which contain the findings and recommendations of
the auditor shall be submitted to the audit committee.
a. Both statements are false
b. Only Statement 1 is true
c. Only Statement 2 is true
d. Both statements are true
2. Statement 1: A member shall have the right to examine the records required to be kept by the
cooperative during reasonable hours on business days and he may demand, in writing, for a copy of
excerpts from said records without charge except the cost of production.
Statement 2: Every cooperative shall, at its principal office, keep and carefully preserve the records
required by this Code to be prepared and maintained. It shall take all necessary precaution to prevent its
loss, destruction or falsification.
a. Only Statement 2 is true
b. Both statements are true
c. Both statements are false
d. Only Statement 1 is true

ALLOCATION AND DISTRIBUTION OF FUNDS – ASSESSMENT

1. The sum allocated for patronage refunds shall be made available at the same rate to all patrons of the
cooperative in proportion to their individual patronage, provided, that:
a. In the case of a non-member patron, his proportionate amount of patronage refund shall be set aside
in a general fund for such patrons and shall be allocated to individual non-member patrons only upon
request and presentation of evidence of the amount of his patronage.
b. In the case of a member patron with unpaid share capital contribution, his proportionate amount of
patronage refund shall be credited to his account until his account until his share capital contribution
has been fully paid;
c. All of the choices
d. In the case of a member patron with paid-up share capital contribution, his proportionate amount of
patronage refund shall be paid to him unless he agrees to credit the amount to his account as
additional share capital contribution;
2. Statement 1: Notwithstanding the provisions of existing laws, the net surplus of cooperatives shall be
determined in accordance with its bylaws.
Statement 2: Every cooperative shall determine its net surplus at the close of every fiscal year and at
such other times as may be prescribed by the bylaws.
a. Only Statement 1 is true
b. Only Statement 2 is true
c. Both statements are false
d. Both statements are true

TYPES AND CATEGORIES OF COOPERATIVES – ASSESSMENT

1. It is one that promotes and undertakes savings and lending services among its members. It generates a
common pool of funds in order to provide financial assistance to its members for productive and
provident purposes.
a. Consumers Cooperative
b. Marketing Cooperative
c. Credit Cooperative
d. Producers Cooperative
2. It is one that undertakes joint production whether agricultural or industrial. It is formed and operated by
its members to undertake the production and processing of raw materials or goods produced by its
members into finished or processed products for sale by the cooperative to its members and non-
members.
a. Consumers Cooperative
b. Producers Cooperative
c. Marketing Cooperative
d. Credit Cooperative

MERGER AND CONSOLIDATION OF COOPERATIVES – ASSESSMENT

1. Statement 1: Two (2) or more cooperatives may merge into a single cooperative, which shall be either
one of the constituent cooperatives or the consolidated cooperatives.
 Statement 2: No merger or consolidation shall be valid unless approved by three-fourths (3/4) vote of all
members with voting rights, present and constituting a quorum of each of the constituent cooperatives at
separate general assembly meetings.
a. Only Statement 1 is true
b. Only Statement 2 is true
c. Both statements are false
d. Both statements are true
2. The following are the procedures to the Merger or Consolidation of cooperatives. Which is the first
procedure?
a. Formulation of the Amendment/New Articles of Cooperation and By-laws;
b. Approval of the proposal to merge or consolidate by the General/Representative Assembly of each
constituent cooperatives;
c. Issuance of Certificate of Registration of Merger/Consolidation by the Authority.
d. Written Notification to Creditors through registered mail with return card and other applicable
electronic means;

DISSOLUTION OF COOPERATIVES – ASSESSMENT

1. The following are the coverage of liquidation, except:

a. Cooperatives whose existence is terminated by appropriate judicial proceedings.
b. Cooperatives whose charter expires by its own limitation.
c. None of the choices
d. Cooperatives whose existence is terminated by voluntary dissolution.
2. The following procedure shall be observed in liquidation of cooperatives. Which is the first procedure?
a. Inventory of Assets and Liabilities of the Cooperative.
b. Cancellation of the Certificates of Registration and delisting of the name of the cooperative in the
Cooperative Registry.
c. Submission of the Board of Liquidators/Trustees of the Liquidation's Final Report.
d. Transfer of the Statutory Funds to the intended beneficiaries.

INSURABLE DEPOSITS – ASSESSMENT

1. I. The Philippine Deposit Insurance Corporation (PDIC) shall insure the deposits of all banks.
II. The PDIC shall promote and safeguard the interests of the depositing public by providing insurance
coverage on all insured deposits and helping maintain a sound and stable banking system.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
2. I. The receiver shall have no authority to invest funds received from the conversion of the assets of the
closed bank in government securities, other government-guaranteed marketable securities or investment-
grade debt instruments.
II. The proceeds of the sale of the bank and branch licenses shall be for the benefits of the creditors of
the closed bank which shall be distributed.
a. Only II is true
 b. Both are true
c. Both are false
d. Only I is true
3. I. Whenever upon examination by the PDIC into the condition of any insured bank, it shall be
disclosed than an insured bank or its directors or agents have committed, are committing or about to
commit unsafe or unsound practices in conducting the business of the bank, or have violated, are
violating or about to violate any provisions of any law or regulation to which the insured bank is subject,
the Board of Directors shall submit the report of the examination to the Monetary Board to secure
corrective action thereon.
II. Each insured bank shall keep and maintain a true and accurate record or statement of its daily deposit
transactions consistent with the standards set by the Bangko Sentral ng Pilipinas and the PDIC.
a. Both are false
b. Only II is true
c. Both are true
d. Only I is true
4. In addition to the powers of a receiver provided under existing laws, the PDIC, as receiver of a closed
bank, is empowered to:
a. Gather and take charge of all assets, records and affairs of the closed bank, and administer the same
for the benefit of its creditors.
b. Represent and act for and on behalf of the closed bank.
c. Convert the assets of the closed bank to cash or other forms of liquid assets.
d. All of the above.
5. I. After the payment of all liabilities and claims against the closed bank, the PDIC shall pay surplus, if
any, dividends at the legal rate of interest from date of takeover to date of distribution to creditors and
claimants of the closed bank.
II. The officers, employees, deputies, assistants and agents of the receiver shall have no liability and
shall not be subject to any action, claim or demand in connection with any act done or omitted to be
done by them in good faith in connection with the exercise of their powers and functions.
a. Bothe are false
b. Only II is true
c. Both are true
d. Only I is true
6. I. The creditors shall have a period of nine (9) months from the date of publication of notice of the
approval by the court of the final asset distribution plan of the closed bank within which to claim
payment of the principal obligations and surplus dividends.
II. The individual stockholders of record of their duly-authorized representative or the court-appointed
stockholders’ representative shall have a period of nine (9) months form publication of notice of the
approval by the court of the final asset distribution plan of the closed bank within which to claim the
residual assets.
a. Only I is true
b. Only II is true
c. Both is true
d. Both is false
7. PDIC shall not pay deposit insurance for the following accounts or transactions.
a. Deposit accounts of transactions which are unfunded, or are fictitious of fraudulent.
 b. Deposit accounts or transactions constituting, and / or emanating from, unsafe and/ or unsound
banking practice /s.
c. Deposit that are determined to be the proceeds of an unlawful activity.
d. Investment products which do not fall under the definition of a deposit
e. All of the above
8. It occurs whenever a deposit account with an outstanding balance of more than the statutory maximum
amount of insured deposit maintained under the name of natural or juridical persons is broken down
and transferred into 2 or more accounts in the name/s of natural or juridical persons or entities who have
no beneficial ownership on transferred deposits in their names within 120 days immediately preceding
or during a bank declared bank holiday, or immediately preceding a closure order issued by the
Monetary Board of the Bangko Sentral ng Pilipinas for the purpose of availing of the maximum deposit
insurance coverage.
a. Partition of deposits
b. Separation of deposits
c. Splitting of deposits
d. Division of deposits
9. Upon the designation of the PDIC as receiver of a closed bank, it shall serve a notice of closure to the
highest- ranking officer of the bank present in the bank premises or on its main entrance.
II. The receiver shall have authority to use reasonable force, including the authority to force open the
premises of the bank, and exercise such acts necessary to take actual physical possession and custody of
the bank and all its assets, records, documents, and take charge of its affairs upon the service of the
notice closure.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
10. I. Whenever an insured bank shall been closed by the Monetary Board, or upon expiration or revocation
of a bank’s corporate term, payment of the insured deposits on such closed bank shall be made by the
PDIC as soon as possible either (1) by cash or (2) by making available to each depositor a transferred
deposit in another insured bank in an amount equal to insured deposit of such depositor.
II. The PDIC, in its discretion, may require proof of claims to be filed before paying the insured
deposits, and that in any case where the PDIC is not satisfied as to the validity of a claim for an insured
depositor, it may require final determination of a court of competent jurisdiction before paying such
claim.
a. Both are false
b. Only II is true
c. Both are true
d. Only I is true

Prior art shall consist of:

I. Everything which has been made available to the public anywhere in the world, before the filing date or the
priority date of the application claiming the invention.
II. The whole contents of an application for a patent, published, filed or effective in the Philippines, with a filing
or priority date that is earlier than the filing or priority date of the application.

a. Only I is true
b. Only II is true
c. Both are false
d. Both are true

I. The exclusive right of the owner of a well-known mark which registered in the Philippines, shall extend to
goods and services which are not similar to those in respect of which the mark is registered.

II. Registration of the mark shall not confer on the registered owner the right to preclude third parties from
using bona fide their names, addresses, pseudonyms, a geographical name, or exact indications concerning the
kind, quality, quantity, destination, value, place of origin, or time of production or of supply, of their goods or
services.

a. Both are true

b. Only II is true
c. Only I is true
d. Both are false

I. The dominancy test focuses on the focuses on the similarity of the prevalent features of the competing
trademarks that might cause confusion or deception.

II. The holistic test requires the court to consider the entirely of the marks as applied to the products, including
the labels and packaging, in determining confusing similarity.

a. Only II is true
b. Both are false
c. Only I is true
d. Both are true

I. The nature of the goods to which the mark is applied will not constitute an obstacle to registration.

II. The Intellectual Property Office (IPO) may accept as prima facie evidence that the mark has become
distinctive, proof of substantially exclusive and continuous use thereof by the applicant in commerce in the
Philippine for 5 years before the date on which the claim of distinctiveness is made.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
11. I. The receiver shall have the authority to facilitate and implement the purchase of the assets of the
closed bank and the assumption of its liabilities by another insured bank, without need for approval of
the liquidation courts.
II. The assets gathered by the receiver shall be evaluated and verified as to their existence, ownership,
condition, and other factors to determine their realizable value.
a. Both are true
b. Only I is true
c. Only II is true
12. The possibility that failure of one bank to settle net transactions with other bank will trigger a chain
reaction, depriving other banks of funds lending to a general shutdown of normal clearing and settlement
activity.
a. General Risk
b. Universal Risk
c. Systemic Risk
d. Chain-reaction Risk
13. One of the following is not a function of the PDIC:
a. Insurance
b. Corporate rehabilitation
c. Bank examination
d. Receivership of closed banks
14. The following are the qualifications of the board of directors of the PDIC, except:
a. At least 45 years old
b. Good moral character
c. Unquestionable integrity and responsibility
d. Recognized competence in economics, banking and finance, law, management administration or
insurance
15. It is the unpaid balance of money or its equivalent received by a bank in the usual course of business and
for which it has given or is obliged to give credit to a commercial, checking, savings, time or thrift
account or which is evidenced by its certificate of deposit, and trust funds held by such bank whether
retained or deposited in any department of such bank or deposited in another bank, together with such
other obligations of a bank as the Board of Directors shall find and shall prescribe by regulations to be
deposit liabilities of the Bank.
a. Transfer Deposit
b. Insured Deposit
c. Trust Fund
d. Deposit
16. It means the amount due to any bonafide depositor for legitimate deposits in an insured bank as of the
date of closure but not to exceed P500, 000.
a. Disputed claim
b. Insured bank
c. Insured deposit
d. Deposit
17. I. If the account is held jointly by two or more natural persons, or by two or more juridical persons or
entities, the maximum insured deposit shall be divided into as many equal shares as there are
 individuals, juridical persons or entities, unless a different sharing is stipulated in the document of
deposit.
II. If the account is held by a juridical person or entity jointly with one or more natural person, the
maximum insured deposit shall be presumed to belong entirely to such juridical person or entity.
a. Only I is true
b. Both are false
c. Both are true
d. Only II is true
18. In the management and/ or conversion of the assets of the closed bank, the receiver shall have the
authority to:
I. Conduct a physical or ocular inspection of the properties owned by, or mortgaged to, the closed
bank, to determine their existence and present condition.
II. Determine the disposal price of assets in accordance with generally accepted valuation
principles, standards and practices.
a. Only II is true
b. Both are false
c. Both are true
d. Only I is true
19. I. Whenever a bank is ordered closed by the Monetary Board, the PDIC shall be designated as receiver
and it shall proceed with the takeover and liquidation of the closed bank
II. The receiver is authorized to adopt and implement, without need of consent of the stockholders, board
of directors, creditors or depositors of the closed bank, any or a combination of the modes of liquidation
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
20. This term means the net amount due to any depositor for deposits in an insured bank (after deducting
offsets) less any part thereof which is in excess of P10,000. Such net amount shall be determined
according to such regulations as the Board of Directors may prescribe and in determining the amount
due to any depositor there shall be added together all deposits in the bank maintained in the same
capacity and the same right for his benefit or in his own name or in the names of others.
a. Deposit
b. Transfer Deposit
c. Trust Fund
d. Insured Deposit
21. I. A joint account regardless of whether the conjunction ‘and’, ‘or’, ‘and/or’ is used, shall be insured
separately from any individually-owned deposit account.
II. That the aggregate of the interest of each co-owner over several joint accounts, whether owned by the
same or different combinations of individuals, juridical persons or entities, shall likewise be subject to
the maximum insured deposit of P500, 000.
a. Both are true
b. Both are false
c. Only II is true
d. Only I is true
22. The following are the composition of the board of directors of the Philippine Deposit Insurance
Corporation (PDIC), except:
a. None of the above
b. Secretary of Finance
c. Four (4) members from the private sector to be appointed by the President of the Philippines
d. President of the PDIC, who shall be appointed by the President of the Philippines
e. Governor of the BSP
23. I. The PDIC upon payment to any depositors shall be subrogated to all rights of the depositor against the
closed bank to the extent of such payment.
II. All payment by the PDIC of insured deposits in closed banks partake of the nature of public funds.
a. Both are true
b. Only I is true
c. Only II is true
d. Both are false
21. The receiver is authorized to adopt and implement, without need of consent of the stockholders, board
of directors, creditors or depositors of the closed bank, any or a combination of the following modes of
liquidation:
I. Conventional liquidation
II. Purchase of assets and/or assumption of liabilities.
a. Only I is true
b. Both are false
c. Both are true
d. Only II is true

MAXIMUM LIABILITY – ASSESSMENT

1. Statement 1: If the account is held jointly by two or more natural persons, or by two or more juridical
persons or entities, the maximum insured deposit shall be divided into as many equal shares as there are
individuals, juridical persons or entities, unless a different sharing is stipulated in the document of
deposit.
Statement 2: If the account is held by a juridical person or entity jointly with one or more natural
persons, the maximum insured deposit shall be presumed to belong entirely to such juridical person or
entity.
a. Both statements are false
b. Only Statement 2 is true
c. Only Statement 1 is true
d. Both statements are true
2. What is PDIC’s maximum deposit insurance coverage?
a. 5,000,000
b. 500,000
c. 50,000
d. 5,000

REQUIREMENTS FOR CLAIMS – ASSESSMENT

1. What happens when the depositor of a closed bank fails to file his claim within the period prescribed by
PDIC?
A. All rights of the depositor with respect to the insured deposit shall no longer be honored.
B. The depositor may still make a claim against the assets of the closed bank.
a. Neither A nor B
b. Both A and B
c. B only
d. A only
2. When should the depositor of a closed insured bank file his claim with PDIC?
a. The depositor of the closed insured bank has 12 months from date of bank takeover to file his
deposit insurance claim.
b. The depositor of the closed insured bank has 24 months from date of bank takeover to file his
deposit insurance claim.
c. The depositor of the closed insured bank has 6 months from date of bank takeover to file his deposit
insurance claim.
d. None of the choices

BANK SECRECY LAW – ASSESSMENT

1. I. It shall be unlawful for any official or employee of a banking institution to disclose to any person any
information concerning deposits.
II. The Secrecy of Bank Deposit Account does not prohibit attachment or garnishment of bank accounts,
which does not involve revealing specific information of deposits.
a. Only I is true
b. Both are true
c. Only II is true
d. Both are false
2. It is hereby declared to be the policy of the Government:
I. To give encouragement to the people to deposit their money in banking institutions.
II. To discourage private hoarding.
a. Both are false
b. Both are true
c. Only II is true
d. Only I is true
3. X, a newspaper columnist, while having a bank transaction, overheard a bank teller informing a co-
employee that Y, the municipal mayor, has just P10,000 in his bank account and that his next check
might probably bounce. X wrote this information in his newspaper column. Thus, Y filed a complaint
against X for violation of the Secrecy of Bank Deposits Act. Decide.
a. X is not liable because he was in good faith when he overheard the remark of the bank teller to a co-
employee.
b. X, who merely overhead the remark of the bank teller to a co-employee and writing the same in his
newspaper column is neither the inquiry nor disclosure contemplated by law.
c. X is liable because bank deposits are absolutely confidential.
d. X is liable because bank deposits is must not be examined, inquired or looked into by any person.
4. I. All deposits of whatever nature with banks or banking institutions in the Philippines including
investments in bonds issued by the issued by the Government of the Philippines, its political
subdivisions and its instrumentalities, are hereby considered as of an absolutely confidential nature.
II. All deposits of whatever nature with banks or banking institutions in the Philippines may not be
examined, inquired or looked into by any person, government official, bureau or office.
a. Both are false
b. Both are true
c. Only I is true
d. Only II is true
5. X is unemployed; however, he is suspected to be a jueteng operator. X has never been charged or
convicted of any crime. He has several bank accounts and purchased several houses and lots from Y
Realty Corp. amounting to P50,000,000. After that, the Register of Deeds reported his purchased to the
Anti-Money Laundering Council (AMLC). Upon request of the AMLC, Z Bank disclosed to it X’s bank
deposits. Subsequently, X was charged in court for violation of the Anti-Money Laundering Law. Did Z
Bank violated the Secrecy of Bank Deposit Act in disclosing X’s bank account to the AMLC?
a. Yes, Z bank violated the Secrecy of Bank Deposit Act since it can disclose bank accounts only upon
the request of the Supreme Court?
b. No. Z bank did not violate the Secrecy of Bank Deposit Act because it is one of the obligation of
banks to disclose bank accounts if public interest requires it.
c. No. Z bank did not violate the Secrecy of Bank Deposit Act. A bank is obliged to report to the
AMLC covered and suspicious transactions.
d. Yes, Z bank violated the Secrecy of Bank Deposit Act since it is absolutely prohibited from
disclosing bank accounts.
6. Y is the creditor of X. Upon demand, X failed to pay Y; thus, the latter filed a case against the former. X
had a savings account with Z Bank.
Subsequently, the court ordered that X’s account be garnished the amount of P100,000 to satisfy the
judgement in favor of Y. X complained that the garnishment violated the Secrecy of Bank Deposit Act.
Decide.
a. X is correct because the Bank Secrecy Law protects the disclosure of the existence of bank accounts
of depositors.
b. X is not correct because pesos deposits may garnished and Y bank can comply with the order of
garnishment without violating the Secrecy of Bank Deposit Act.
c. X complaint is meritorious because peso deposits may not be garnished.
d. X is correct because in the process of garnishment, the information about his saving accounts is
divulge to the public.
7. All deposits of whatever nature with banks or banking institutions in the Philippines may not be
examined, inquired of looked into by any person, government official, bureau or office except upon.
a. Written permission of the depositor
b. Upon order of a competent court in cases of bribery or dereliction of duty of public officials.
c. All of the above
d. In case of impeachment

UNCLAIMED BALANCES LAW – ASSESSMENT

1. I. The unclaimed balances, together with the increase and proceeds thereof, shall be deposited with the
Treasurer of the Philippines to the credit of the Government of the Republic of the Philippines.
I. The unclaimed balances, together with the increase and proceeds thereof, shall be deposited with the
Treasurer of the Philippines to the credit of the Government of the Republic of the Philippines.
a. Both are true
b. Both are false
c. Only II is true
d. Only I is true
2. It includes credits or deposits of money, bullion, security, or other evidence of indebtedness of any kind,
and interest thereon with banks, building and loan associations, and trust corporations in favor of any
person known to be dead or who has not made further deposits or withdrawals during the preceding ten
years or more.
a. Prescribed balances
b. Liquidated balances
c. Claimed balances
d. Unclaimed balances
3. I. Whenever the Solicitor General shall be informed of such unclaimed balances, he shall commence an
action or actions in the name of the People of the Republic of the Philippines in which shall be joined as
parties the bank, building and loan association or trust corporation and all such creditors or depositors.
II. Upon the trial, the court must hear all parties who have appeared therein, and if it be determined that
such unclaimed balances in any defendant bank, building and loan association, or trust corporation
are unclaimed balances have been escheated to the Government of the Republic of the Philippines and
commanding said bank, building and loan association or trust corporation to forthwith deposit the same
with the Treasurer of the Philippines to credit of the Government of the Republic of the Philippines.
a. Only II is true
b. Both are false
c. Only I is true
d. Both are true
4. I. The unclaimed balances, together with the increase and proceeds thereof, shall be deposited with the
Treasurer of the Philippines to the credit of the Government of the Republic of the Philippines.
II. All banks, building and loan associations, and trust corporations shall forward to the Treasurer of the
Philippines a statement, under oath, of their respective managing officers, of all credits and deposits held
by them in favor of persons known to be dead, or who have not made further deposits or withdrawals
during the preceding ten years or more.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
5. It refers to the judicial process in which the State, by virtue of its sovereignty, steps in and claims
abandoned, left vacant, or unclaimed property, without there being an interested person having a legal
claim thereto.
a. Escheat proceedings
b. Annulment proceedings
c. Nullity proceedings
d. Eviction proceedings
 COVERED INSTITUTIONS / PERSONS / TRANSACTIONS – ASSESSMENT

1. It is a transaction in cash or other equivalent monetary instrument involving a total amount in excess of
five hundred thousand pesos (Php500,000.00) within one (1) banking day.
a. Valid transactions
b. Suspicious transactions
c. Invalid transactions
d. Covered transactions

SUSPICIOUS TRANSACTIONS – ASSESSMENT

1. The following circumstance exists in suspicious transactions (choose the exception):

a. the client is not properly identified;
b. there is underlying legal or trade obligation, purpose or economic justification;
c. the amount involved is not commensurate with the business or financial capacity of the client;
d. taking into account all known circumstances, it may be perceived that the client’s transaction is
structured in order to avoid being the subject of reporting requirements under AMLA;

REPORTING REQUIREMENTS – ASSESSMENT

1. Covered institutions shall report to the Anti-Money Laundering Council (ALMC) all covered
transactions and suspicious transactions within ___ working days from occurrence thereof, unless the
supervising authority concerned prescribes a longer period not exceeding ___ working days.
a. 5, 10
b. 5, 15
c. 10, 20
d. 5, 20
2. Statement 1: The Covered Transaction Report (CTR) and the Suspicious Transaction Report (STR) shall
be in the forms prescribed by the Anti-Money Laundering Council (ALMC).
Statement 2: Covered transaction reports and suspicious transaction reports shall be submitted in a
secured manner to the Anti-Money Laundering Council (AMLC) in electronic form.
a. Both statements are true
b. Only Statement 1 is true
c. Both statements are false
d. Only Statement 2 is true

LAW ON PATENTS – ASSESSMENT

1. I. The application shall relate to one invention only or to a group of inventions forming a single general
inventive concept.
II. The fact that a patent has been granted on an application that did not comply with the requirement of
unity on investment shall not be ground to cancel the patent.
 a. Both are false
b. both are true
c. Only I is true
d. Only II is true
2. I. Any patentee, or anyone possessing any right, title or interest in and to the patented invention, whose
right have been infringed, may bring a civil action before a court competent jurisdiction, to recover from
the infringer such damages sustained thereby, plus attorney’s fees and other expenses of litigation, and to
secure an injunction for the protection of his rights.
II. Anyone who actively induces the infringement of a patent or provides the infringer with a component
of a patented product or of a product produced because of a patented process knowing it to be especially
adopted for infringing the patented invention and not suitable for substantial non-infringing use be liable
as a contributory infringer and shall be jointly liable with the infringer.
a. Both are true
b. Only I is true
c. Both are false
d. Only II is true
3. In case the employee made the invention in the course of his employment contract, the patent shall
belong to:
I. The employee, if the inventive activity is part of his regular duties even if the employees uses the
time, facilities and materials of the employer.
II. The employer, if the invention is the result of the performance of his regularly-assigned duties,
unless there is an agreement, express or implied, to the contrary.
a. Both are false
b. Only II is true
c. Only I is true
d. Both are true
4. I. If the subject matter of a patent is a process of obtaining a product, any identical product shall be
presumed to have been obtained through the use of the patented process if the product is new or there is
substantial likelihood that the identical product was made by the process and the owner of the patent has
been unable despite reasonable efforts, to determine the process actually used.
II. Damages cannot be recovered for acts of infringement committed before the infringer had known; or
had reasonable grounds to know of the patent.
a. Only II is true
b. Both are false
c. Only I is true
d. Both are true
5. It means any person who, at the filing date of application, had the right to the patent.
a. Infringer
b. Inventor
c. Proprietor
d. Trader
6. I. The person who commissions the work shall own the patient, unless otherwise provided in the
contract.
 II. An application for patent filed by any person who has previously applied for the same invention in
another country which by treaty, convention, or law affords similar privileges to Filipino citizens, shall
be considered as filed as of the date of filing the foreign application.
a. Only II is true
b. Only I is true
c. Both are false
d. Both are true
7. I. If the application meets the legal requirements, the Intellectual Property Office (IPO) shall grant the
patent.
II. A patent shall take effect on the date of the publication of the grant of the patent in the IPO Gazette.
a. Only II is true
b. Both are true
c. Both are false
d. Only I is true
8. I. Patent owners shall also have the right to assign, or transfer by succession the patent, and to conclude
licensing contracts for the same.
II. Any prior user, who, in good faith was using the invention or has undertaken serious preparations to
use the invention in his enterprise or business, before the filing date or priority date of the application on
which a patent is granted, shall have the right to continue the use thereof as envisaged in such
preparations within the territory where the patent produces its effect.
a. Both are true
b. Only II is true
c. Both are false
d. Only I is true
9. I. An invention shall not be considered new if it forms part of a prior art.
II. An invention involves an inventive step if, having regard o prior art, it is not obvious to a person
skilled in the art at the time of the filing date or priority date of the application claiming the invention.
a. Only II is true
b. Only I is true
c. Both are false
d. Both are true
10. I. No patent may be granted unless the application identifies the inventor.
II. An applicant who is not a resident of the Philippines must appoint and maintain a resident agent or
representative in the Philippines.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
11. Any interested person may petition to cancel the patent or any claim thereof, or parts of the claim, on the
following ground/s:
a. All of the above
b. That what is claimed as the invention is not new or patentable.
c. That the patent does not disclose the invention in a manner sufficiently clear and complete for it to
be carried out by any person skilled in the art.
d. That the patent is contrary to public order or morality.
12. I. After publication of a patent application, any interested party may inspect the application documents
filed with the Intellectual Property Office.
II. Following the publication of the patent application, any person may present observations in writing
concerning the patentability of the invention. Such observations shall be communicated to the applicant
who may comment on them.
a. Only I is true
b. Both are false
c. Both are true
d. Only II is true
13. The making, using , offering for sale, selling, or importing a patented product or a product obtained
directly or indirectly from a patented process, or the use of a patented process without the authorization
of the patentee constitutes:
a. Patent infringement
b. Copyright infringement
c. Trademark infringement
d. Double sale
14. I. Any technical solution of a problem in any field of human activity which is new, involves an inventive
step and is industrially applicable shall be patentable.
II. Patentable invention may be, or may relate to, a product, or process, or an improvement of any of the
foregoing.
a. Only I is true
b. Only II is true
c. Both are true
d. Both are false
15. Statement 1: The right to a patent belongs to the inventor, his heirs, or assigns.
Statement 2: When two (2) or more persons have jointly made an invention, the right to a patent shall
belong to them solidarily.
a. Both statements is true
b. Both statements is false
c. Only Statement 2 is true
d. Only Statement 1 is true
16. I. An invention that can be produced and used in any industry shall be industrially applicable.
II. An invention involves an inventive step if, having regard to prior art, it is not obvious to a person
skilled in the art at the time filing date or priority date of the application claiming the invention.
a. Only I is true
b. Both are false
c. Both are true
d. Only II is true
17. A patent shall confer on its owner the following exclusive rights:
I. Where the subject matter of a patent is a product: to restrain, prohibit and prevent any
unauthorized person or entity from making, using offering for sale, selling, or importing that
product;
II. Where the subject matter of a patent is a process: to restrain, prevent or prohibit any
unauthorized person or entity from using the process, and from manufacturing, dealing in, using,
 selling or offering for sale, or importing any product obtained directly or indirectly from such
process.
a. Both are true
b. Only II is true
c. Both are false
d. Only I is true
18. I. The term of a patent shall be 17 years from the filing date of the application.
II. To maintain the patent application or patent, an annual fee shall be paid upon the expiration of 4 years
from the date the application was published.
a. Only I is true
b. Both are true
c. Both are true
d. Only II is true
19. I. In an action for infringement, the defendant, in addition to other defense available to him, may show
the invalidity of the patent, or any claim thereof.
II. In an action for infringement, if the court shall find the patent or any claim to be invalid, it shall
cancel the same.
a. Both are false
b. Only II is true
c. Only I is true
d. Both are true
11. I. The right to a patent belongs to the inventor only.
II. When two or more persons have jointly made an invention, the right to a patent shall belong to them
jointly.
a. Both are true
b. Only I is true
c. Only II is true
d. Both are false
12. Which of the following are patentable inventions?
a. Any technical solution of a problem in any field of human activity which is new, involves an
inventive step and is industrially applicable.
b. Methods for treatment of the human or animal body by surgery or therapy and diagnostic methods
practiced on the human or animal body.
c. Discoveries, scientific theories and mathematical methods;
d. Schemes, rules and methods of performing mental acts, playing games or doing business, and
programs for computers;
13. A Government agency or third person authorized by the Government may exploit the invention even
without agreement of the patent owner where:
I. The public interest, in particular, national security, nutrition, health or the development of other
sectors, as determined by the appropriate agency of the government, so requires.
II. A judicial or administrative body has determined that the manner of exploitation, by the owner of
the patent or his licensee, is anti-competitive.
a. Both are false
b. Both are true
c. Only II is true
 d. Only I is true
14. If a person, who was deprived of the patent without his consent or through fraud is declared by final
court order or decision to be the true and actual inventor, the court shall order:
I. For his substitution as patentee.
II. At the option of the true inventor, cancel the patent, and award actual and other damages in his
favor if warranted by the circumstances.
a. Only I is true
b. Only II is true
c. Both are true
d. Both are false

LAW ON TRADEMARK, SERVICE MARKS AND TRADE NAMES – ASSESSMENT

1. I. A certificate of registration shall remain in force for 10 years.

II. A certificate of registration may be renewed for periods of 10 years at its expiration.
a. Only I is true
b. Both are false
c. Both are true
d. Only II is true
2. I. The owner of a registered mark may recover damages from any person who infringes his rights.
II. The measure of the damages suffered shall be either the reasonable profit which the complaining
party would have made, had the defendant not infringed his rights, or the profit which the defendant
actually made out of the infringement.
a. Both are false
b. Only II is true
c. Both are true
d. Only I Is true
3. I. In infringement of trademark, the prior registration of the trademark is a prerequisite to the action.
II. In unfair competition, registration is not necessary.
a. Only I is true
b. Both are true
c. Only II is true
d. Both are false
4. It is the name or designation identifying or distinguishing an enterprise.
a. Copymark
b. Mark
c. Tradename
d. Collective Mark
5. It is any visible sign capable of distinguishing the goods (trademark) or services (service mark) of an
enterprise and shall include a stamped or marked container of goods.
a. Collective Mark
b. Copymark
c. Mark
d. Tradename
6. I. The owner of a registered mark shall have the exclusive right to prevent all third parties not having the
owner’s consent from using in the course of trade identical or similar signs or containers for goods or
services which are identical or similar to those in respect of which the trademark is registered where
such use would result in a likelihood of confusion.
II. In case of the use of an identical sign for identical goods or services, a likelihood of confusion shall
be presumed.
a. Both are true
b. Only I is true
c. Both are false
d. Only II is true
7. I. An application for registration of a mark, or its registration, may be assigned or transferred with or
without the transfer of the business using the mark.
II. The assignment of the application for registration of a mark, or of its registration, shall be in writing
and require the signature of the contracting parties.
a. Both are false
b. Only I is true
c. Both are true
d. Only II is true
8. I. A registered mark shall have no effect against any person who, in good faith, before the filing date or
the priority date, was using the mark for the purposes of his business or enterprise.
II. Where an infringing who is engaged solely in the business of printing the mark or other infringing
materials for others is an innocent infringer, the owner of the right infringed shall be entitled as against
such infringer only on to an injunction against future printing
a. Only II is true
b. Both are true
c. Both are false
d. Only I is true
9. A mark cannot be registered if it:
a. Consists of the flag or coat of arms or other insignia of the Philippines or any of its political
subdivisions, or of any foreign nation, or any simulation thereof;
b. all of the choices
c. Consists of a name, portrait or signature identifying a particular living individual except by his
written consent, or the name, signature, or portrait of a deceased President of the Philippines, during
the life of his widow, if any, except by written consent of the widow;
d. Consists of immoral, deceptive or scandalous matter, or matter which may disparage or falsely
suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring
them into contempt or disrepute;
10. I. Assignment and transfers of registration of marks shall be recorded at the IPO; assignment and
transfers of applications for registration shall be provisionally recorded, and the mark, when registered,
shall be in the name of the assignee or transferee.
II. Assignment and transfers shall have no effect against third parties until they are recorded at the IPO.
a. Only II is true
b. Only II is true
c. Only I is true
d. Both are false
11. I. The use of the mark in a form different from the form in which it is registered, which does not alter its
distinctive character, shall not be a ground for cancellation or removal of the mark and shall not
diminish the protection granted to the mark.
II. The use of a mark by a company related with the registrant or applicant shall inure to the latter’s
benefit, and such use shall not affect the validity of such mark or of its registration.
a. Both are true
b. Only II is true
c. Both are false
d. Only I is true
12. I. A petition to cancel a registration of a mark may be filed by any person who believes that he is or will
be damaged by the registration of a mark.
II. Non-use of a mark may be excused if caused by circumstances arising independently of the will of
the trademark owner. Lack of funds shall excuse non-use of a mark.
a. Both are true
b. Only II is true
c. Only I is true
d. Both are false
13. Any person who shall, without the consent of the owner of the registered mark, use in commerce any
reproduction, counterfeit, copy, or colorable imitation of a registered mark or the same container or a
dominant feature thereof in connection with the sale, offering for sale, distribution, advertising of any
goods or services including other preparatory steps necessary to carry out the sale of any goods or
services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to
deceive.
a. Unfair competition of trademark
b. Infringement of trademark
c. Copyrighting of trademark
d. Patenting of trademark
14. It means any visible sign designated as such in the application for registration and capable of
distinguishing the origin or any other common characteristic.
a. Collective logo
b. Collective sign
c. Collective mark
d. Collective symbol
15. I. In any action in which a violation of any right of the owner of the registered mark is established, the
court may order that goods found to be infringing be, without compensation of any sort, disposed of
outside the channels of commerce of destroyed.
II. In any suit for infringement, the owner of the registered mark shall not be entitled to recover profits
or damages unless the act have been committed with knowledge that such imitation is likely to cause
confusion, or to cause mistake, or to deceive.
a. Only II is true
b. Both are false
c. Both are true
d. Only I is true
16. It refers to mark considered well-known by the competent authority of the country where protection for
the mark is sought.
 a. Well-known mark
b. Patent mark
c. Trademark
d. Service mark
17. I. Infringement of trademark is the unauthorized use of a trademark.
II. Unfair competition is the passing off of one’s goods as those of another.
a. Only II is true
b. Both are false
c. Both are true
d. Only I is true
18. I. A certificate of registration of a mark may be issued to the assignee of the applicant.
II. A certificate of registration of a mark shall be prima facie evidence of the validity of the registration,
the registrant’s ownership of the mark, and of the registrant’s exclusive right to use the same in
connection with the good or services and those that are related thereto specified in the certificate.
a. Only II is true
b. Both are true
c. Both are false
d. Only I is true
19. I. In infringement of trademark, fraudulent intent is unnecessary.
II. In unfair competition, fraudulent intent is essential.
a. Only I is true
b. Only II is true
c. Both are false
d. Both are true
20. I. A certificate of registration of a mark shall be conclusive evidence of the validity of the registration,
the registrant’s ownership of the mark, and of the registrant’s exclusive right to use the same.
II. A certificate of registration shall remain in force for 15 years.
a. Both are false
b. Both are true
c. Only I is true
d. Only II is true
21. It means any visible sign capable of distinguishing the goods (trademark) or services (service mark) of
an enterprise and shall include a stamped or marked container of goods.
a. Mark
b. Collective mark
c. Trademark
d. Service mark
22. I. Any person who shall employ deception or any other means contrary to good faith by which he shall
pass off the goods manufactured by him or in which he deals, or his business, or services for those of the
one having established such goodwill, or who shall commit any acts calculated to produce said result,
shall be guilty of unfair competition.
II. A person who has identified in the mind of the public the goods he manufactures or deals in, his
business or services from those of others, whether or not a registered mark is employed, has a property
right in the goodwill of the said goods, business or services so identified, which will be protected in the
same manner as other property rights.
 a. Both are true
b. Only II is true
c. Both are false
d. Only I is true

LAW ON COPYRIGHT – ASSESSMENT

1. The following derivative works shall also be protected by copyright:

I. Dramatizations, translations, adaptations, abridgments, arrangements, and other alterations of
literary or artistic works; and
II. Collections of literary, scholarly or artistic works, and compilations of data and other materials
which are original by reason of the selection or coordination or arrangement of their contents.
a. Both are false
b. Both are true
c. Only II is true
d. Only I is true
2. I. The natural person whose name is indicated on a work in the usual manner as the author shall, in the
absence or proof to the contrary, be presumed to be the author of the work.
II. The person or body, corporate whose name appears on an audio-visual work in the usual manner
shall, in the absence of proof to the contrary, be presumed to be the maker of said work.
a. Only I is true
b. Only II is true
c. Both are false
d. Both are true
3. In the case of work created by an author during and in the course of his employment, the copyright shall
belong to:
I. The employer, if the creation of the object of copyright is not a part of this regular duties even if
the employee uses the time, facilities, and materials of the employer.
II. The employee, if the work is the result of the performance of his regularly-assigned duties,
unless there is an agreement, express, or implied, to the contrary.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
4. It is information which identifies the work, sound recording, or performance; the author of the work,
producer of the sound recording, or performer of the performance; the owner of any in the work, sound
recording or performance; and any number or code that represent such information, when any of these
items is attached to a copy of the work, sound recording or fixation of performance or appears in
conjunction with the communication to the public of a work, sound recording or performance.
a. Right identification of information
b. None of the above
c. Right recording of information
d. Right management information
5. It is any technology, device or component that in the normal course of its operation, restricts acts in
respect of a work, performance or sound recording which are not authorized by authors, performance or
producers of sound recording concerned or permitted by law.
 a. Technological measure
b. None of the above
c. Rights in management information
d. Infringement
6. I. The copyright may be assigned in whole or in part.
II. The copyright is not deemed assigned inter vivos in whole or in part unless there is a written
indication of such intention.
a. Both are true
b. Only II is true
c. Only I is true
d. Both are false
7. It is recitation, playing, dancing, acting or otherwise performing the work, either directly or by means of
any device or process in the case of a work other than an audio-visual work.
a. Private performance
b. Public performance
c. Public publishing
d. Private publishing
8. Statement 1: in the case of original literary and artistic works, copyright shall belong to the author of the
work;
Statement 2: In the case of works of joint authorship, the co-authors shall be the original owners of the
copyright and in the absence of agreement, their rights shall be governed by the rules on co-ownership.
a. Both statements is false
b. Only Statement 2 is true
c. Both statements is true
d. Only Statement 1 is true
9. Copyright or economic rights shall consist of the exclusive right to carry out, authorize, or prevent the
following acts, except:
a. Reproduction of the work or substantial portion of the work
b. Public display of the original or a copy of the work
c. Dramatization, translation, adaptation, abridgment, arrangement, or other transformation of the work
d. None of the above
10. These are works, which, with the consent of the authors, are made available to the public by wire or
wireless means in such a way that members of the public may access these works from a place and time
individually chosen by them.
a. None of the above
b. Published works
c. Public performance
d. Private performance
11. Is an artistic creation with utilitarian function or incorporated in a useful article, whether made by hand
or produced on an industrial scale?
a. Work of implied art
b. Work of applied art
c. Work of express art
d. None of the above
12. I. No protection shall extend to any idea, procedure, system method or operation, concept, principle,
discovery, or mere data as such, even if they are expressed, explained, illustrated, or embodied in a
work; news of the day and other miscellaneous facts having the character of mere items of press
information; or any official text of a legislative, administrative or legal nature, as well as any official
translation thereof.
II. No copyright shall subsist in any work of the Government of the Philippines.
a. Both are true
b. Both are false
c. Only I is true
d. Only II is true
13. I. In the case of a work-commissioned by a person other than an employer of the author and who pays
for it the work is made in pursuance of the commission, the person who so commissioned the work shall
have ownership of work, but the copyright thereto shall remain with the creator, unless there is written
stipulation to the contrary.
II. In the case of audio-visual work, the copyright shall belong to the producer, the author of the
scenario, the composer of the music, the film director, and the author of the work so adapted.
a. Only I is true
b. Both are true
c. Only II is true
d. both are false
14. I. The submission of a literary, photographic, or artistic works to a newspaper, magazine or periodical
for publication shall constitute only a license to make a single publication unless a greater right is
expressly granted.
II. The copyright is distinct from the property in the material object subject to it. Consequently, the
transfer or assignment, or licensing of the copyright shall not itself constitute a transfer of the material
object. Nor shall a transfer or assignment or licensing of the sole copy or of one or several copies of the
work imply transfer or assignment of the copyright.
a. Both are false
b. Only II is true
c. Only I is true
d. Both are true
15. I. An author cannot be compelled to perform his contract to create a work or for the publication of his
work already in existence. However, he may be held liable for damages for each of such contract.
II. When an author contributed to a collective work, his right to have his contribution attributed to him is
deemed waived unless he expressly reserves it
a. Both are false
b. Only I is true
c. Only II is true
d. Both are true
16. An author may waive his moral rights by a written instrument, but no such waiver shall be valid where
its effects is to permit another:
I. To use the name of the author, or the title of his work, or otherwise to make use of his reputation
with respect to any version or adaptation of his work which, because of alterations therein, would
substantially trend to injure the literary or artistic reputation of another author
II. To use the name of the author with respect to a work he did not create.
 a. Only II is true
b. Both are false
c. Only I is true
d. Both are true
17. Performers shall enjoy the following exclusive rights:
a. The right of authorizing the direct or indirect reproduction of their performances fixed in sound
recordings, in any manner or form.
b. All of the above
c. The right of authorizing the making available to the public of their performances fixed in sound
recordings, by wire or wireless means, in such a way that members of the public may access them
from a place and time individually chosen by them.
d. The right of authorizing the commercial rental to the public of the original and copies of their
performances fixed in sound recording, even after distribution of them by, or pursuant to the
authorization by the performer.
18. I. In respect of letters, the copyright shall belong to the writer.
II. The publisher shall be deemed to present the authors of articles and other writings published without
the names of the authors or under pseudonyms, unless the contrary appears, or the pseudonyms or
adopted name leaves no doubts as to the authors’ identity, or if the author of the anonymous works
discloses his identity.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
19. Any person infringing a right under the law on copyright shall be liable:
a. To pay to the copyright proprietor or his assigns or heirs such actual damages, including legal costs
and other expenses, as he may have incurred due to the infringement as well as the profits the
infringer may have made due to such infringement.
b. All of the above.
c. To deliver under oath, for impounding during the pendency of the action, upon such terms and
conditions as the court may prescribe, sales invoices, and other documents evidencing sales, all
articles and their packaging alleged to infringe a copyright and implements for making them.
d. To an injunction restraining such infringement.
20. I. In the case of original literary and artistic works, copyright shall belong to the author of the work.
II. In the case of works of joint authorship, the co-authors shall be the original owners of the copyright
and in the absence of agreement, their rights shall be governed by the rules on partnership.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
21. It is a work which has been created by two or more natural persons at the initiative and under the
direction of another with the understanding that it will be disclosed by the latter under his own name and
that contributing natural persons will not be identified
a. Merged work
b. Combined work
c. Collective work
 d. Consolidated work
22. It is the transfer of possession of the original or a copy of a work or sound recording for a limited period,
for non-profit purposes, by an institution the services of which are available to the public, such as public
library or archive.
a. Commodatum
b. Mutuum
c. Private publishing
d. Public lending
23. Is a work created by an officer or employee of the Philippine Government or any of its subdivisions and
instrumentalities, including government - owned or controlled corporations as part of his regularly
prescribed official duties?
a. None of the above
b. A work of the civil servant
c. A work of the Government of the Philippine
d. A work of a public officer or employee
24. It is the transmission by wireless means for the public reception of sounds or of images or of
representation thereof.
a. Broadcasting
b. Communication
c. None of the above
d. Announcement
25. It is the natural person who has created a work.
a. Inventor
b. Author
c. Owner
d. Tradename
26. Is a work that consists of a series of related images which impart the impression of motion, with or
without accompanying by sounds, susceptible of being made visible and, where accompanied by sounds,
susceptible of being made audible?
a. Audio-visual work
b. Audio recording
c. Sound recording
d. Fixation
27. Is the transfer of the possession of the original or a copy of a work or a sound recording for a limited
period of time for profit-making purposes?
a. Reproduction
b. Licensing
c. Rental
d. None of the above
28. I. The copyright may be assigned in whole or in part.
II. The copyright is not deemed assigned inter vivos in whole or in part unless there is a written
indication of such intention.
a. Only II is true
b. Only I is true
c. Both are true
 d. Both are false
29. Is the making of one more copies of a work or a sound recording in any manner or form?
a. Rental
b. Licensing
c. None of the above
d. Reproduction
30. I. In case of works of applied art, the protection shall be for a period of 50 years from the date of
making.
II. In case of photographic works, the protection shall be for 50 years from publication of the work and,
if unpublished, 50 years from the making.
a. Both are false
b. Only I is true
c. Only II is true
d. Both are true
31. The author of a work shall have the right (Scope of Moral Rights):
a. All of the above
b. To object to any distortion, mutilation or other modification of, or other derogatory action in relation
to, his work which would be prejudicial to his honor or reputation;
c. To make any alterations of his work prior to, or to withhold it from publication;
d. To require that the authorship of the works be attributed to him, in particular, the right that his name,
as far as practicable, be indicated in a prominent way on the copies, and in connection with the
public use of his work;
32. It is the fixation of the sounds of a performance or of other sounds, or representation of sound, other
than in the form of a fixation incorporated in a cinematographic or other audio-visual work
a. Audio recording
b. Audio-visual work
c. Sound recording
d. Fixation
33. It is making of a work available to the public by wire or wireless means in such a way that member of
the public may access these works from a place and time individually chosen by them.
a. Communication to the public
b. Advertising to the public
c. Printing to the public
d. Publication to the public
34. Statement 1: No copyright shall subsist in any work of the Government of the Philippines.
Statement 2: The Government is not precluded from receiving and holding copyrights transferred to it by
assignment, bequest or otherwise; nor shall publication or republication by the Government in a public
document of any work in which copyright is subsisting be taken to cause any abridgment or annulment
of the copyright or to authorize any use or appropriation of such work without the consent of the
copyright owner
a. Both statements is true
b. Both statements is false
c. Only Statement 2 is true
d. Only Statement 1 is true
35. The rights granted to performers and producers of sound recordings under this law shall expire:
 I. For performances not incorporated in recording, 50 years from the end of the year in which the
performance took place.
II. For sound or image and sound recordings and for performances incorporated therein, 50 years
from the end of the year in which the recording took place.
a. Both are false
b. Only II is true
c. Both are true
d. Only I is true
36. Are original intellectual creations in the literary and artistic domain protected from the moment of their
creation?
a. None of the above
b. Works
c. Arts
d. Talents
37. Are actors, singing, musicians, dancers, and other persons who act, sing declaim, play in, interpret, or
otherwise perform literary and artistic work?
a. Performers
b. Professionals
c. Consultants
d. Specialists
38. The following acts shall not constitute infringement of copyright:
a. The making of quotations from a published work if they are compatible with fair use and only to the
extent justified for the purpose, including quotations from newspaper articles and periodicals in the
form of press summaries: Provided, That the source and the name of the authors, if appearing on the
work, are mentioned.
b. The reproduction or communication to the public by mass media of articles on current political,
social, economic, scientific or religious topic, lectures, addresses and other works of the same nature,
which are delivered in public if such use is for information purposes and has not been expressly
reserved: Provided, That the source is clearly indicated
c. All of the above
d. The recitation or performance of a work, once it has been lawfully made accessible to the public, if
done privately and free of charge or if made strictly for a charitable or religious institution or
society.
39. I. In case of works of joint authorship, the economic rights shall be protected during the life of the last
surviving author and for 50 years after his death.
II. In case of anonymous or pseudonymous works, the copyright shall be protected for 50 years from the
date on which the work was first lawfully published.
a. Only I is true
b. Both are true
c. Both are false
d. Only II is true
40. Producers of sound recordings shall enjoy the following exclusive rights:
a. The right to authorize the direct or indirect reproduction of their sound recordings, in any manner or
form; the placing of these reproductions in the market and the right of rental or lending.
 b. The right to authorize the first public distribution of the original and copies of their sound recordings
through sale or rental or other forms of transferring ownership.
c. The right to authorized the commercial rental to the public of the original and copies of their sound
recordings, even after distribution by them by or pursuant to authorization by the producer.
d. All of the above
41. I. The fair use of a copyrighted work for criticism, comment, news reporting, teaching including
multiple copies for classroom use, scholarship, research, and similar purposes is not an infringement of
copyright.
II. Decompilation, which is understood here to be the reproduction of the code and translation of the
forms computer program to achieve the inter-operability of an independently created computer program
with other programs may also constitute fair use.
a. Only I is true
b. Both are true
c. Only II is true
d. Both are false

PROCESSING AND SECURITY OF PERSONAL INFORMATION – ASSESSMENT

1. Personal information must be:

I. Adequate and not excessive in relation to the purposes for which they are collected and
processed.
II. Retained only for as long as necessary for the fulfillment of the purposes for which the data was
obtained or for the establishment, exercise or defense of legal claims, or for legitimate business
purposes, or as provided by law.
a. Only II is true
b. Only I is true
c. Both are true
d. Both are false
2. I. The unauthorized processing of personal information shall be penalized by imprisonment ranging
from 1 year to 3 years and a fine of not less than P500,000 but not more than P2,000,000 shall be
imposed on persons who process personal information without the consent of the data subject, or
without being authorized.
II. The unauthorized processing of personal sensitive information shall be penalized by imprisonment
ranging from 3 years to 6 years and a fine of not less than P500,000 but not more than P4,000,000 shall
be imposed on persons who process personal information without the consent of the data subject, or
without being authorized.
a. Both are false
b. Only II is true
c. Only I is true
d. Both are true
3. Data Privacy Act applies to:
I. The processing of all types or personal information.
II. To any natural and juridical person involved in personal information processing including those
personal information controllers and processors who, although not found or established in the
 Philippines, use equipment that are located in the Philippines, or those who maintain an office,
branch or agency in the Philippines.
a. Only II is true
b. Both are false
c. Only I is true
d. Both are true
4. I. The penalty of imprisonment ranging from 1 year to 3 years and a fine of not less than P500,000 but
not more than P2,000,000 shall be imposed on persons who knowingly and unlawfully, or violating data
confidentially and security data systems, breaks in any way into any system where personal and
sensitive personal information is stored.
II. The penalty of imprisonment of 1 year and 6 months to 5 years and a fine of not less than P500,000
but not more than P1,000,000 shall be imposed on persons who, after having knowledge of a security
breach, intentionally or by omission conceals the fact of such security breach.
a. Both are false
b. Both are true
c. Only I is true
d. Only II is true
5. The following are the rights of the data subject, except
a. Dispute the inaccuracy or error in the personal information and have the personal information
controller correct it immediately and accordingly, unless the request is vexatious or otherwise
unreasonable
b. Suspend, withdraw or order the blocking, removal or destruction of his or her personal information
from the personal information controller’s filing system upon discovery and substantial proof that
the personal information are incomplete, outdated, false, unlawfully obtained, used for unauthorized
purposes or are no longer necessary for the purposes for which they were collected.
c. None of the above.
d. Be informed whether personal information pertaining to him or her shall be, are being or have been
processed.
6. It refers to any freely given, specific, informed indication of will, whereby the data subject agrees to the
collection and processing of personal information about and/or relating to him or her.
a. Cause of the data subject
b. None of the above
c. Object of the data subject
d. Consent of the data subject
7. I. The lawful heirs and assigns of the data subject may invoke the rights of the data subject for, which he
or she is an heir or assignee at any time after the death of the data subject or when the data subject is
incapacitated.
II. The data subject shall the right, where personal information is processed be electronic means and in
structured and commonly used format, to obtain from the personal information controller a copy of data
undergoing processing in an electronic or structured format, which is commonly used and allows for
further use by the data subject.
a. Both are true
b. Only I is true
c. Only II is true
d. Both are false
8. I. Accessing personal information due to negligence shall be penalized by imprisonment ranging from 1
year to 3 years and a fine of not less than P 500,000 but not more than P2,000,000 shall be imposed on
persons who, due to negligence, provided access to personal information without being authorized.
II. Accessing sensitive personal information due to negligence shall be penalized by imprisonment
ranging from 3 years to 6 years and a fine of not less than P500,000 but not more than P4,000,000 shall
be imposed on persons who, due to negligence, provided access to personal information without being
authorized.
a. Only I is true
b. Both are true
c. Only II is true
d. Both are false
9. I. A personal information controller may not subcontract the processing of personal information.
II. Personal information controllers may not invoke the principles of privileged communication over
privileged information that they lawfully control or process.
a. Both are true
b. Only II is true
c. Both are false
d. Only I is true
10. Data Privacy Act does not apply to:
I. Information about an individual who is or was performing service under contract for a
government institution that relates to the services performed, including the terms of the contract,
and the name of the individual given in the course of the performance of those services.
II. Information relating of a license or permit given by the government to an individual, including
the name of the individual and the exact nature of the benefit.
a. Only II is true
b. Both are false
c. Both are true
d. Only I is true
11. It refers to a system for generating, sending, receiving, storing or otherwise processing electronic data
messages or electronic documents and includes the computer system or other similar device by or which
data is recorded, transmitted or stored and any procedure related to the recording, transmission or
storage of electronic data, electronic message, or electronic documents.
a. Electronic Documents System
b. Information and Communication System
c. Electronic and Data System
d. Recording and Transmission System
12. I. Each personal information controller is responsible for personal information under its control or
custody, including information that have been transferred to a third party for processing, whether
domestically or internationally, subject to cross-border arrangement and cooperation.
II. The personal information controller shall designate an individual or individuals who are accountable
for the organization’s compliance with the Data Privacy Act. The identity of the individual (s) so
designated shall be made known to any data subject upon request.
a. Both are true
b. Both are false
c. Only I is true
 d. Only II is true
13. Sensitive personal information refers to personal information:
I. About an individual’s race, ethnic origin, marital status, age, color, and religious, philosophical
or political affiliations.
II. About an individual’s health, education, genetic or sexual life of a person, or to any proceeding
for any offense committed or alleged to have been committed by such person, the disposal of
such proceedings, or the sentence of any court in such proceedings.
a. Both are true
b. Only II is true
c. Only I is true
d. Both are false
8. I. The personal information controller must implement reasonable and appropriate organizational,
physical and technical measures intended for the protection of personal information against any
accidental or unlawful destruction, alteration and disclosure, as well as against any other unlawful
processing.
II. The personal information controller shall implement reasonable and appropriate measures to protect
personal information against natural dangers such as accidental loss or destruction, and human dangers
such as unlawful access, fraudulent misuse, unlawful destruction, alteration and contamination.
a. Both are true
b. Both are false
c. Only II is true
d. Only I is true
14. I. The employees, agents, or representatives of a personal information controller who are involved in the
processing of personal information shall operate and hold personal information under strict
confidentiality if the personal information are not intended for public disclosure.
II. The personal information controller must further ensure that third parties processing personal
information on its behalf shall implement the security measures.
a. Only I is true
b. Both are true
c. Only II is true
d. Both are false
15. It refers to any act of information relating to natural or juridical persons to the extent that, although the
information is not processed by equipment operating automatically in response to instructions given for
that purpose the set is structured, either by reference to individuals or by reference to criteria relating to
individual, in such a way that specific information relating to a particular person is readily accessible
a. Equipment system
b. Information system
c. Corporate system
d. Filing system
16. It refers to any operation or any set of operations performed upon personal information including but not
limited to, the collection, recording, organization, storage, updating or modification, retrieval,
consultation, use, consolidation, blocking erasure, or destruction of data.
a. Destruction
b. Processing
c. Organizations
 d. Operations
17. I. The improper disposal of personal information shall be penalized by imprisonment ranging from 6
months to 2 years and a fine of not less than P100,000 but not more than P500,000 shall be imposed on
persons who knowing or negligently dispose, discard, or abandon the personal information of an
individual in an area accessible to the public or has otherwise placed the personal information of an
individual in its container for trash collection.
II. The improper disposal of sensitive personal information shall be penalized by imprisonment ranging
from 1 year and a fine of not less than P100,000 but not less than P1,000,000 shall be imposed on person
who knowingly or negligently dispose, discard, or abandon the personal information of an individual in
an are accessible to the public or has otherwise placed the personal information of an individual in its
container for trash collection.
a. Both are true
b. Only II is true
c. Only I is true
d. Both are false
18. It refers to an individual whose personal information is processed.
a. Data object
b. Data subject
c. Data presentation
d. None of the above
19. I. Any personal information controller or personal information processor or any of its officials,
employees or agents, who disclosed to a third party the subject personal information without the consent
of the data subject, shall he subject to imprisonment ranging from 1 year to 3 years and a fine of not less
than P500,000 but not more than P1,000,000.
II. Any personal information controller or personal information processor or any of its official,
employees or agents, who disclosed to a third party sensitive personal information without the consent
of the data subject, shall be subject to imprisonment ranging from 3 years to 5 years and a fine of not
less than P500,000 but not more than P2,000,000.
a. Both are false
b. Only II is true
c. Only I is true
d. Both are true
20. It refers to any information whether recorded in a material form or not, from which the identity of an
individual is apparent or can be reasonably and directly ascertained by the entity holding the
information, or when put together with other information would directly and certainly identity an
individual.
a. Public information
b. Private information
c. Individual information
d. Personal information
21. The processing of sensitive personal information and privileged information shall be prohibited, except
in the following cases:
a. The processing is necessary for purposes or medical treatment, is carried out by a medical
practitioner or a medical treatment institution, and an adequate level of protection of personal
information is ensured.
 b. The data subject has given his or her consent, specific to the purpose prior to the processing, or in
the case or privileged information, all parties to the exchange have given their consent prior to
processing.
c. All of the above.
d. The processing is necessary to protect the life and health of the data subject or another person, and
the data subject is not legally or physically able to express his or her consent prior to the processing.
22. Data Privacy Act applies to an act done or practice engaged in and outside of the Philippines by an
entity if:
I. The act, practice or processing relate to personal information about a Philippine citizen or a resident;
II. The entity has a link with the Philippines, and the entity is processing personal information in the
Philippines or even if the processing is outside the Philippines as long as it is about Philippine citizen or
residents.
a. Only II is tru
b. Both are false
c. Both are true
d. Only I is true
23. I. No employee of the government shall have access to sensitive personal information on government
property or through online facilities unless the employee has received a security clearance from the head
of the source agency.
II. Sensitive personal information maintained by an agency may not be transported or accessed from a
location off government property unless a request for such transportation or access is submitted and
approved by the head of the agency.
a. Both are false
b. Only II is true
c. Both are true
d. Only I is true
24. I. The processing of personal information for unauthorized purposes shall be penalized by imprisonment
ranging from 1 year and 6 months to 5 years and a fine of not less than P500,000 but not more than
P1,000,000 shall be imposed on persons processing personal information for purposes not authorized by
the data subject, or otherwise authorized.
II. The processing of sensitive personal information for unauthorized purposes shall be penalized by
imprisonment ranging from 2 years to 7 years and a fine of not less than P500,000 but not more than
P2,000,000 shall be imposed on persons processing sensitive personal information for purposes nor
authorized by the data subject, or otherwise authorized.
a. Only I is true
b. Only II is true
c. Both are false
d. Both are true
25. It refers to communication by whatever means of any advertising or marketing materials which is
directed to particular individuals.
a. Direct marketing
b. Indirect marketing
c. None of the above
d. Telephone marketing
26. The processing of personal information shall be permitted only if not otherwise prohibited by law, and
when at least one of the following conditions exists. Which is not one of the conditions?
a. The data subject need not necessary give his or her consent.
b. The processing is necessary to protect vitally important interests of the data subject, including life
and health.
c. The processing of personal information is necessary and is related to the fulfillment of a contract
with the data subject or in order to take steps at the request of the data subject prior to entering into a
contract.
d. The processing is necessary for compliance with a legal obligation to which the personal information
controller is subject.
27. It refers to a person or organization who controls the collection, holding, processing or use of personal
information, including a person or organization who instructs another person or organization to collect,
hold, process, use, transfer, or disclose personal information on his or her behalf.
a. Public information controller
b. Personal information controller
c. Private information controller
d. Individual information controller
28. It refers to an individual whose personal information is processed.
a. Data presentation
b. Data object
c. None of the above
d. Data subject
29. It refers to any natural or juridical person qualified to act as such under the Data Privacy Act of 2012 to
whom a personal information controller may outsource the processing of personal data pertaining to a
data subject.
a. Public information processor
b. Private information processor
c. Personal information processor
d. Individual information processor
30. I. All sensitive personal information maintained by the government, its agencies and instrumentalities
shall be secured, as far as practicable, with the use of the most appropriate standard recognized by the
information and communications technology industry.
II. The head of each government agency or instrumentality shall be responsible for complying with the
security requirements.
a. Both are false
b. Both are true
c. Only II is true
d. Only I is true

LEGAL RECOGNITION AND COMMUNICATIONS OF ELECTRONIC DATA MESSAGES AND

ELECTRONIC DOCUMENTS – ASSESSMENT
1. It refers to a person who in behalf of another person and with respect to a particular electronic document
sends, receives, and/ or stores provides other services in respect of that electronic data message or
electronic document
a. Mediator
b. Messenger
c. Arbitrator
d. Intermediary
2. I. Information shall not be denied legal effect, validity, or enforceability solely on the grounds that it is
the data message purporting to give rise to such legal effect, or that it is merely referred to in that
electronic data message.
II. Electronic documents shall have the legal effect, validity or enforceability as any other document or
legal writing.
a. Only I is true
b. Both are false
c. Both are true
d. Only II is true
3. In any proceedings involving an electronic signature, it shall be presumed that:
I. The electronic signature is the signature of the person to whom it correlates.
II. The electronic signature was affixed by that person with the intention of signing or approving the
electronic document unless the person relying on the electronically signed electronic document
knows or has noticed of defects in or unreliability of the signature or reliance on the electronic
signature is not reasonable under the circumstances.
a. Only II is true
b. Both are false
c. Both are true
d. Only I is true
4. I. In assessing the evidential weight of an electronic data message or electronic document, the reliability
of the manner in which it was generated, stored or communicated the reliability of the manner in which
its originator was identified, and other relevant factors shall be given due regard.
II. As between the originator and the addresses of an electronic data message or electronic document, a
declaration of will or other statement shall not be denied legal effect, validity or enforceability solely on
the ground that it is in the form of an electronic data message.
a. Both are true
b. Both are false
c. Only I is true
d. Only II is true
5. I. The person seeking to introduce an electronic data message or electronic document in any legal
proceeding has the burden of proving its authentically by evidence capable of supporting a finding that
the electronic data message or electronic document is what the person claims it to be.
II. In assessing the evidential weight of an electronic data message or electronic document, the reliability
of the manner in which it was generated, stored or communicated, the reliability of the manner in which
its originator was identified, and other relevant factors shall be given due regard.
a. Only I is true
b. Only II is true
c. Both are false
 d. Both are true
6. It refers to a secret code which secures and defends sensitive information that cross over public channels
into a form decipherable only with a matching electronic key.
a. Electronic Key
b. Electronic Code
c. Electronic Password
d. Electronic Answer
7. It refers to any distinctive mark, characteristics and / or sound in electronic form, representing the
identity of a person and attached to or logically associated with electronic data message or electronic
document or any methodology or procedures employed or adopted by a person and executed or adopted
by such person with the intention of authenticating or approving an electronic data message or electronic
document.
a. Electronic Copyright
b. Electronic Name
c. Electronic Signature
d. Electronic Trademark
8. It refers to any device or apparatus which, by electronic, electro–mechanical, or magnetic impulse, or by
other means, is capable of receiving, recording, transmitting, storing, processing, retrieving, or
producing information, data, figures, symbols, or other modes of written expression according to
mathematics and logical rules or of performing any one or more of these functions.
a. Data processor
b. System
c. Notebook
d. Computer
9. Unless otherwise agreed between the originator and the addressee, the time of receipt of an electronic
data message or electronic document is as follows:
I. If the addressee has designated an information system for the purpose of receiving electronic
data message or electronic document, receipt occurs at the time when the electronic data message
or electronic document enters the designated information system.
II. If the electronic data message or electronic documents is sent to an information system of the
addressee that is not the designated information system, receipt occurs at the time when the
electronic data message or electronic document is retrieved by the addressee.
III. If the addressee has not designated an information system, receipt occurs when the electronic
data message or electronic document enters an information system of the addressee.
a. I, II, and III are true
b. Only III is true
c. Only I is true
d. Only II is true
10. In a decision rendered by the disciplining authority, X was dismissed from the government service.
Thereafter, X filed an appeal but it was denied. Subsequently, X filed a motion for reconsideration which
was sent through facsimile transmission. Is a facsimile transmission considered an electronic evidence
under the Electronic Commerce Act?
a. A facsimile transmission is considered as an electronic document under the Electronic Commerce
Act.
 b. Facsimile transmission is the functional equivalent of an original under the best Evidence Rule and
is admissible as electronic evidence.
c. The terms “electronic data message” and electronic document, “as defined under the Electronic
Commerce Act of 2000, includes a facsimile transmission. Accordingly, a facsimile transmission ca
be considered as electronic evidence.
d. The terms “electronic data message” and electronic document,” as defined under the Electronic
Commerce Act of 2000, do not include a facsimile transmission. Accordingly, a facsimile
transmission cannot be considered as electronic evidence.
11. I. An electronic data message or electronic document is that of the originator if it was sent by the
originator himself.
II. Where an electronic data message or electronic document is that of the originator or is deemed to be
that of the originator, or the addressee is entitled to act on that assumption, then, as between the
originator and the addressee, the addressee is entitled to regard the electronic data message or electronic
document as received as being what the originator intended to send, and to act on that assumption.
a. Only I is true
b. Both are false
c. Both are true
d. Only II is true
12. I. Unless otherwise agreed between the originator and the addressee, the dispatch of an electronic data
message or electronic document occurs when it enters an information system outside the control of the
originator or of the person who sent the electronic data message or electronic documents on behalf of the
originator.
II. Unless otherwise agreed between the originator and the addressee, an electronic data message or
electronic document is deemed to be dispatched at the place where the originator has its place of
business and received at the place where the addressee has its place of business.
a. Both are true
b. Only II is true
c. Only I is true
d. Both are false
13. It refers to a person who is intended by the originator to receive the electronic data message or electronic
document.
a. Sender
b. Recipient
c. Addressee
d. None of the above
14. Service provider refers to a provider of:
I. On-line services or network access or the operator of facilities therefor, including entities
offering the transmission, routing, or providing of connections for online communications,
digital or otherwise, between or among points specified by a user, or electronic documents of the
user’s choosing.
II. The necessary technical means by which electronic documents of an originator may be stored
and made accessible to designated or undesignated third party.
a. Only II is true
b. Both are true
c. Both are false
 d. Only I is true
15. The requirement in any provision of law that certain documents be retained in their original form is
satisfied by retaining them in the form of an electronic data message or electronic document which:
a. Remains accessible so as to be usable for subsequent reference.
b. All of the above.
c. Is retained in the format in which it was generated, sent or received, or in a format which can be
demonstrated to accurately represent the electronic data message or electronic document generated,
sent or received
d. Enables the identification of its originator and addressee, as well as the determination of the date and
the time it was sent or received
16. Where the law requires information to be presented or retained in its original form, that requirements is
met by an electronic data message or electronic document if;
I. The integrity of the information from the time when it was first generated in its final form, as an
electronic data message or electronic document is shown by evidence aliunde or otherwise; and
II. Where it is required that information be presented, that the information is capable of being
displayed to the person to whom it is to be presented.
a. Both are false
b. Only I is true
c. Only II is true
d. Both are true
17. It refers to information generated, sent, received, or stored by electronic, optical or similar means.
a. None of the above
b. Electronic Data Message
c. Electronic Communication
d. Electronic Information
18. It refers to a system intended for and capable of generating, sending, receiving storing, or otherwise
processing electronic data messages or electronic documents and includes the computer system or other
similar device by or in which data is recorded or stored and any procedures related to the recording or
storage of electronic data message or electronic document
a. Information and Communications System
b. Electronic Data System
c. Data Processor System
d. Computer System
19. I. Electronic Commerce Act aims to facilitate domestic and international dealings, transactions,
arrangement, agreements, contracts and exchanges, and storage of information through the utilization of
electronic, optical and similar medium, mode, instrumentality and technology to recognize the
authenticity and reliability of electronic documents related to such activities and to promote the
universal use of electronic transaction in the government and general public.
II. Electronic Commerce Act shall apply to any kind of data message and electronic document used in
the context of commercial and non-commercial activities to include domestic and international dealings,
transactions, arrangement, agreements, contracts and exchanges and storage of information.
a. Both are false
b. Only II is true
c. Only I is true
d. Both are true
20. In any legal proceedings, nothing in the application of the rules on evidence shall deny the admissibility
of an electronic data message or electronic document in evidence.
I. On the sole ground that it is electronic form.
a. Only II is true
b. Both are true
c. Both are false
d. Only I is true
21. I refers to information or the representation of information, data, figures, symbols or other modes or
written expression, described or however represented, by which a right is established or an obligation
extinguished, or by which a fact may be proved and affirmed, which is received, recorded, transmitted,
stored, processed, retrieved, or produced electronically.
a. Electronic Pape
b. Electronic Document
c. Electronic File
d. Electronic Data
22. I. Except as otherwise agreed by the parties, an offer, the acceptance of an offer, and such other elements
required under existing laws for the formation of contracts may be expressed in, demonstrated and
proved by means of electronic data message or electronic documents and no contract shall be denied
validity or enforceability on the sole ground that it is in the form of an electronic data message or
electronic document, or that any or all of the elements required under existing laws for the formation or
contracts is expressed, demonstrated and proved by means of electronic data messages or electronic
documents.
II. Electronic transaction made through networking among banks, or linkages thereof with other entities
or networks, and vice versa, shall be deemed consummated upon the actual dispensing of cash or the
debit of one account and the corresponding credit to another, whether such transaction is initiated by the
depositor or by an authorized collecting party, provided, that the obligation of one bank, entity, or person
similarly situated to another arising therefrom shall be considered absolute and shall not be subjected to
the process of preference of credits.
a. Both are false
b. Only II is true
c. Only In is true
d. Both are true
23. It refers to a person by whom, or on whose behalf, the electronic document purports to have been
created, generated and/ or sent.
a. Originator
b. Creator
c. Maker Originator
d. Inventor
24. As between the originator and the addressee, an electronic data message or electronic document is
deemed to be that of the originator if it was sent:
I. By a person who had the authority to act on behalf of the originator with respect to that
electronic data message or electronic document.
II. By an information system programmed by, or on behalf of the originator to operate
automatically.
a. Both are true
 b. Only I is true
c. Both are false
d. Only II is true
25. I. The electronic signature shall be authenticated by proof that a letter, character, number, or other
symbol in electronic form representing the persons named in and attached to or logically associated with
an electronic data message, electronic document, or that the appropriate methodology or security
procedures, when applicable, were employed or adopted by such person, with the intention of
authenticating or approving in an electronic data message or electronic document.
II. The electronic data message or electronic document shall be authenticated by proof that an
appropriate security procedure, when applicable was adopted and employed for the purpose of verifying
the originator of an electronic data message for the purpose of verifying the originator of an electronic
data message and/or electronic document, or detecting error or alteration in the communication, content,
storage of an electronic document or electronic data message from a specific point, which, using
algorithm or codes, identifying words or numbers, encryptions, answer back or acknowledgement
procedures, or similar security devices.
a. Both are true
b. Only II is true
c. Only I is true
d. Both are false

PART 1

Question 1

Which of the following is a defense that is available against a holder in due course?

Absence of delivery of complete instrument

Fraud in factum

Illegality of consideration
Acquisition of instrument by force or duress

Question 2

Which of the following is not a requisite of a holder in due course?

He becomes the holder of the instrument after it is overdue, and with notice that it had been previously
dishonored if such was the fact.

He holds an instrument that is complete and regular upon its face.

At the time the instrument is negotiated to him, he has no notice of infirmity in the instrument or defect in the
title of the person of the person negotiating it.

He takes the instrument in good faith and for value.

Question 3

Which of the following is not a warranty of a qualified indorser of negotiable instrument?

That he has good title to the instrument.

That the instrument, is at the time of his indorsement, is valid and subsisting.

That the instrument is genuine and in all respects what it purports to be.

That all prior parties had capacity to contract.

Question 4

Which of the following is not an element of criminal violation of Batas Pambansa Bilang 22 for issuance of
worthless checks?

There must be subsequent dishonor of the check by the drawee bank for insufficiency of funds or creditor
dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to stop payment.

There must be intent to commit fraud upon the issuance of worthless check.

There must be making, drawing, and issuance of any check to apply for account or for value.

There must be knowledge of the maker, drawer, or issuer that at the time of issue he does not have sufficient
funds in or credit with the drawee bank for the payment of the check in full upon its presentment.

Question 5

What is the prima facie evidence that the drawer of issuer of check has knowledge that check he issued has
insufficient fund?
The making, drawing and issuance of a check payment of which is refused by the drawee because of insufficient
funds in or credit with such bank, when presented within twenty (20) days from the date of the check.

The making, drawing and issuance of a check payment of which is refused by the drawee because of insufficient
funds in or credit with such bank, when presented within ninety (90) days from the date of the check.

The making, drawing and issuance of a check payment of which is refused by the drawee because of insufficient
funds in or credit with such bank, when presented within sixty (60) days from the date of the check.

The making, drawing and issuance of a check payment of which is refused by the drawee because of insufficient
funds in or credit with such bank, when presented within thirty (30) days from the date of the check.

Question 6

The following are similarities between a partnership and a corporation. Which is the exception?
Both are organizations composed of an aggregate of individuals.

The individuals composing both have little voice in the conduct of the business.
Both have juridical personalities separate and distinct from that of the individuals composing them.

Like a partnership, a corporation can act only through agents.

Question 7

A partner in a partnership who is not really a partner, not being a party to the partnership agreement but is made
liable as a partner for the protection of innocent third persons is known as:

Nominal partner or partner by estoppel.

Dormant partner.

Answer not given.

Secret partner.

Question 8

When cash or property worth P3, 000 or more is contributed as capital, the Articles of Co-Partnership shall be in
a public instrument and registered with the Securities and Exchange Commission. If the said requirements are
not complied with:

It will not give a legal personality to the partnership.

It will render the partnership void

It will not affect the liability of the partnership and the partners thereof to third parties.

It will give the partnership a de facto existence.

Question 9

Ralph and Vi orally agreed to form a partnership. Each contributed cash and personal properties worth P10, 000
to a common fund. But they did not register the partnership with the Securities and Exchange Commission
(SEC).

The partnership is void

The partnership is voidable

The partnership is still valid

The partnership is unenforceable

Question 10
W, X, Y and Z are the general partners, who contributed P500, 000.00, P300, 000.00, P100, 000.00 and services
to the common fund, respectively. After dissolution the partnership suffered losses amounting to P600, 000.00.
How much shall be the share of Z in the losses?

Equal with the capitalist partners

According to agreement, if there is any

Just and reasonable

None

Question 11

A, B and C are general partners in ABC Partnership. A, the managing partner engaged personally in a business
that is same as business of the partnership without the consent of B and C.

The profits or losses will be shared equally by A and the Partnership.

If there are profits, A will give the profits to the partnership.

If there are profits, they will be shared by partner A and ABC Partnership.
If there are losses, the partnership will bear the losses.

Question 12

A and B are capitalist partners, with C as an industrial partner. A and B contributed P15,000.00 each the capital
of the partnership. A contractual liability of P40,000.00 was incurred by the partnership in favor of X. In the
case of bar, the capital asset of P30, 000.00 shall first be exhausted thereby leaving an unsatisfied liability of
P10,000.00. X can recover the amount from:
A and B only.

A, B and C and C can recover for reimbursement from A and B.

A, B and C.

Answer not given.

Question 13

A, B, C are partners in a trucking and freight business, B and C without the knowledge of A approached X and
offered to sell to X all the trucks of the partnership at a price very much higher than their book value. The B and
C bough-out A from the partnership and thereafter X bought all the trucks with a big profit of B and C.
When A was bought-out of the partnership, the partnership was dissolved so A has no more share in the profit in
the sale.
The sale of the trucks to X void because it is without the knowledge and consent of A.

No choice

B and C are not liable to A whatsoever.

Question 14

Which is not a ground for the automatic dissolution of a partnership?

By the insolvency of any partner or of the partnership.

By the insanity of any partner

By the death of any partner

By the civil interdiction of any partner

Question 15

In a limited partnership, the creditor of a limited partner may charge the interest of the indebted limited partner,
the interest so charged may be redeemed with:

Both partnership property and separate property of the general partner cumulatively

Both partnership property and separate property of the general partner alternatively

Partnership property

Separate property of any general partner

Question 17

A corporation, the sole purpose of which is to invest its capital in a specific property and afterwards consume
that property or extract its value at a profit is called:
Open corporation

Wasting asset corporation

Eleemosynary corporation

Quasi corporation

Question 17

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

Non-stock corporation
Close corporation

Religious corporation

Widely-held corporation

Educational corporation

Question 18
Revised Corporation Code of the Philippines is:

R.A. 12322

R.A. 11322

R.A. 11232

R.A. 13211

Question 18

Three of the following are requisites for the existence of de facto corporation, except:

Actual use of corporation powers

Existing in law and in fact

Attempt in good faith to organize

Incorporated under a vaild law

Question 19

Which of the following complies with the legal requirements for incorporation?

Authorized capital stock Subscribed capital stock Paid-up capital

P64,000.00 P16,000.00 P4,500.00

P1,000,000.00 P500,000.00 P123,000.00

P300,000.00 P100,000.00 P24,500.00

P500,000.00 P300,000.00 P80,000.00

Question 20

A private corporation organized under the corporation law commences to have corporate existence and juridical
personality and its deemed incorporated from:

The date when the articles of incorporation is signed by the incorporators.

When the articles of incorporation is notarized by a Notary Public.

From the date the SEC issues a certificate of incorporation under its official seal.

When the articles of incorporation and by laws are presented and received by the Security and Exchange
Commission and the filing fee is paid.

Question 21

Incorporators of a corporation:

All of the above

Not less than five but not more than fifteen

Majority is required to be resident of the Philippines

Must own or must subscribe to at least one (1) share of the capital stock of the corporation

Question 22

The following are not only express powers of the corporation but also inherent powers, EXCEPT:

None of the above

Power to make by-laws
Power of succession

Power to sue and be sued

Part 2:

Question 1

Which of the following qualifications is necessary in order that one may be elected secretary of the corporation?

He must be a director of the corporation

He must be a stockholder of the corporation.

He must not be a secretary of any other corporation

He must be a citizen and a resident of the Philippines

Question 2

X is a director in T Corp. who was elected to a 1-year term on February 1, 2018. On April 11, 2018, X resigned
and was replaced by R, who assumed as director on May 17, 2010. On November 21, 2018, R died. S was then
elected in his place. Until which time should S serve as director?

April 11, 2019

February 1, 2019

May 17, 2019

November 21, 2019

Question 3

When an article of incorporation provides for non-voting shares such as redeemable or preferred shares, the
holders of such shares shall nevertheless be entitled to vote on the following matters except?

Decrease of capital stock

Payment of bonded indebtedness

Amendment of the articles of incorporation

Adoption and amendment of by-law

Question 4

Stock which has been issued by a corporation, has fully paid up when in fact it is not, because it has been issued
as bonus or otherwise, without any consideration at all, or for less than par, or for property, labor or services at
an overvaluation.
Over issued stock

Watered stock
Redeemable stock

Treasury stock

Question 5

Which of the following statement is not correct about preferred shares?

It can be issued less than P5 peso

It can be issued by the a ban

It is absolutely no voting rights

It can be issued only with par value
Question 6

The right given to the stockholders to dissent and demand payment of the fair value of their shares is called:

Right of proxy

Appraisal right

Stock right

Pre-emptive right"

Question 7

It is one brought by one or more of the stockholder 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 used or hold control of the corporation.

Appraisal right

Derivative suit

Quo warranto

Mandamus

Question 8

What is the voting proportion required for the voluntary dissolution of the corporation?

Majority votes of the board of directors and 2/3 votes of the outstanding capital stock.
Majority vote of the board of directors and 2/3 vote of the stockholders
Majority votes of the board of directors and majority vote of the outstanding capital stock

Majority vote of the board of directors and majority vote of the stockholders

Question 9

“The majority vote its board of directors and by the vote or written assent of the stockholders representing at
least two-thirds of the subscribed capital stock of the corporation” is prescribed under the corporation law for
this purpose

To amend the articles of incorporation.

For adoption of any by-law or by-laws

To invest its corporate funds in any corporation or business, or for any purpose other than the main purpose for
which it was organized.
For declaration of stock dividends
Question 10

Which of the following cannot be included as a valid provision under the By laws:

The time, place and manner of calling and conducting regular or special meetings of the directors or trustees;

The time for holding the annual election of the directors or trustees and the mode or manner of giving notice
thereof.

The time, place and manner of calling and conducting regular or special meetings of the stockholders or
members;

The penalties for violation of the By laws

Question 11

The by-laws of a corporation may create an executive committee, composed of not less than 3 members of the
board of directors to be appointed by the board. The executive committee may act, by majority vote of all its
members on such specific matters within the competence of the board, as may be delegated to it in the bylaws
or on majority vote of the board, EXCEPT:

Approval of any action for which shareholders' approval is also required.

Amendment or repeal of by laws or adoption of new by laws.

Filling of vacancies in the Board,

All of the above

Question 12
The corporation has a nine-member board of directors. Two of the members sold their shares while two others
are abroad. To have a quorum, the number require is:
Three

Seven

Four

Five

Question 13

Unless the by-laws provide otherwise, written notice of regular meetings shall be sent to all stockholders of
record
At least two (2) days prior to the meeting
At least one (1) day prior to the meeting

At least one (4) week prior to the meeting

At least two (2) weeks prior to the meeting

Question 14

Regular meetings of stockholders or members shall be held annually on a date fixed in the by-laws, or if not
fixed, on any date, as determined by the board of directors or trustees, in:
January

April

December

July

Question 15

A non-stock corporation:

No part of the income must be distributed as dividends

All of the above

One where the capital is not divided into shares

May not engage in business for profit

Question 16

The number of the Board of Trustees in a non-stock corporation?

May be less than five upon its organization.

Shall not be less than five but not more than fifteen.

May be more than fifteen upon its organization provided the same is stated in the article of incorporation only.

May be more than fifteen upon its organization provided that is stated in the article of incorporation or the by-
laws.

Question 17

Voluntary dissolution of a corporation is caused by:

Amendments of the Articles of Incorporation resulting in the shortening of corporate term

Voluntary dissolution where no creditors are affected

Voluntary dissolution where creditors are affected

All of the above

Question 18

Foreign corporation

If found to be engaged in business without any license, they are not permitted to sue in any court or
administrative agency of the Philippines but may be sued.
Are not permitted to transact business in the Philippines until after they have obtained a license for the purpose
from SEC.

All of the above

Are organized under the laws of countries other than the Philippines

Question 19

What is the maximum ownership of Foreigners in a cooperative in the Philippines?

40%

100%

None

60%

Question 20
Upon registration of the Cooperative with the Cooperative Development Authority, the former must have at
least
All of these

25% of the Authorized Share Capital is subscribed

25% of the Subscribed Share Capital is paid

P15,000 paid up share capital

Question 21

The following are the principles of cooperatives, EXCEPT

Democratic Officers’ control

Autonomy and independenceVoluntary and open membership

Concern for community

Part 3:

Question 1

In areas where there are no available notaries public, the judge exercising his ex officio capacity as notary
public, shall render service, free of charge, to any person or group of persons requiring the administration of
oath or the acknowledgement of articles of cooperation and instruments loan from cooperatives not exceeding
P200,000

P250,000

P50,000

P100,000

Question 2

Under RA 9520, the following are mandated committees of a cooperative, EXCEPT

Audit Committee

Election Committee

Ethics Committee

Credit Committee

Question 3
The kinds of membership in cooperatives.

Regular and special

Class A and Class B

Regular and associate

Ordinary and extra- ordinary

Question 4

Cooperatives’ net surplus is generally allocated based on the provision of the individual coop’s by-laws and in
accordance with the Cooperative Code, as follows:
Reserved Fund

Cooperative Educ. & Training Fund

Optional Fund

Community Devt Fund

Interest on Capital & Patronage Refund

50%
10%

7%

3%

30%

65%
10%

5%

5%

15%

10%
10%

7%
3%

70%

10%

10%

5%

5%

70%
Question 5

Any merger or consolidation of cooperatives shall be effective upon:

The issuance of the certificate of merger and consolidation by the CDA

The election of the directors of the merged and consolidated cooperatives

The date indicated in the articles of merger and consolidation

The filing of the articles of merger and consolidation with the CDA

Question 6

A cooperative may be dissolved by order of a competent court after due hearing on the ground/s of:

I. violation of any law, regulation or provisions of its bylaws

II. Insolvency

II only

I only
I and II

None of the given

Question 7

Where no creditors are affected, the cooperative may be voluntarily dissolved by vote of the board of directors
and by a resolution duly adopted by the affirmative vote of at least of all members with voting rights, present in
constituting a quorum at a meeting to be held upon call of the directors
¾;3/4

Majority 2/4
2/3;3/4

Majority 2/3

Question 8

X is a depositor of AAA Bank. She has three (3) deposit accounts all under her name. One, in checking account,
one in saving account and another one in time deposit account. Each account has a balance of Php250,000.
AAA Bank became insolvent. Philippine Deposit Insurance Corporation closed the Bank. X therefore is unable
to withdraw from all of the accounts. She then filed her claims with the Philippine Deposit Insurance
Corporation. Which statement is most accurate?
X can only claim from one (1) account of Php250,000.
X can claim a total of Php750,000 from all the three (3) accounts.

X can claim a total of Php500,000 for all the three (3) accounts.

X cannot claim anything from any of the deposit accounts.

Question 9

Analiza has two separate single bank accounts with P1,000,000 and P2,000,000 balance, respectively in the
same bank which is closed by BSP. Belen, on the other hand, has two separate single bank accounts with
P3,000,000 and P2,000,000 balance, respectively with the said bank. Aside from that, Analiza has two separate
joint accounts with different persons in the same bank. The first joint account of Analiza is with Belen with
balance of P10,000,000 while the other joint account of Analiza is with Atasha with balance of P4,000,000.
How much is the maximum insured amount by PDIC from these deposits concerning Analiza and Belen,
respectively?

P1,000,000 and P500,000

P1,000,000 and P750,000

P500,000 and P500,000

P1,000,000 and P1,000,000

Question 10

Under R.A. 1405, which of the following is not covered by the Bank Secrecy Law?
Savings deposit and demand deposit

Investment in bonds issued by the Government of the Philippines, its political subdivisions and its
instrumentalities.

Investment in time deposit

Investment in bonds issued by publicly traded corporations

Question 11

In which office shall the letter requesting the reactivation of unclaimed balances or dormant account be filed by
the applicant depositor?

Bureau of Customs

Bureau of Treasury

Bureau of Internal Revenue

Bureau of Immigration
Question 12

Which of the following is a covered person, therefore, required to report to AMLC reportable or suspicious
transactions?

Casinos

Transportation companies

Educational institution

Mining companies

Question 13

Under the Anti-Money Laundering Law, a covered institution is required to maintain a system of verifying the
true identity of their clients as well as persons purporting to act on behalf of

Unknown principals.

Those doing business with such clients

The covered institution.

Such clients

Question 14

For purposes of determining violation of the provisions of Anti-Money Laundering Law, a transaction is
considered as a "Suspicious Transaction" with "Covered Institutions" regardless of the amount involved, where
which the following circumstances exist/s?
there is no underlying legal or trade obligation, purpose or economic justification;

client is not properly identified;

All of the above

the amount involved is not commensurate with the client's business or financial capacity

Question 15

When may the Anti- Money Laundering Council (AMLC) perform an inquiry into deposits of a person?

To determine his assets with proper court order

When there is written consent of the depositor.

For purposes of determining his liabilities

Upon order of the court when there is probable cause that the deposits are related to crime of unlawful activities
defined in R.A. 9194
Question 16

Anti-Money Laundering Council refers to the financial intelligence unit of the Republic of the Philippines
which is the government agency tasked to implement the AMLA. Which of the following statements regarding
the composition of AMLC is incorrect?

The Insurance Commissioner is a member of AMLC.

The chairperson of AMLC is the BSP governor.

The SEC Chairperson is a member of AMLC

The BIR Commissioner is a member of AMLC.

Question 17

Newton and Einstein invented separately the technology for time machine. On January 1, 2018, Newton
obtained patent for his technology in USA. On April 1, 2018, Einstein registered his right over the same
technology with IPO of Philippines. On May 1, 2018, Newton filed an application for patent for the same
technology with IPO of Philippines and such local application claims priority. On June 1, 2018, Newton
submitted a certified copy of the foreign application together with an English translation with IPO of
Philippines. Who has better right over the patent?

Newton because he has earlier priority date.

Einstein because he has earlier local application filing date

None of them

Government

Question 18
It refers to an intellectual property granted or issued by IPO which gives an exclusive right to an inventor of a
product, process or an improvement of a product or process which is new, inventive and useful to exclude others
from making, using, or selling the product of his invention during the life of the intangible asset.

Tradename

Patent

Copyright

Trademark

Question 19
It refers to trademark infringement test that focuses on the similarity of the main, prevalent or essential features
of the competing trademarks that might cause confusion.

Dominancy test

Doctrine of Equivalents Infringement test

Literal infringement test

Holistic test

Question 20

Suppose an author published a book describing a new method of book-keeping, which of the following
statements is true?

The extent of the author’s copyright is limited to him being able to prevent third persons from copying portions
of his work; he is unable to prevent third persons from employing or describing the method discussed in such
book

The author has a copyright over the book as well as the method described in his book; thus, he is able to
preclude others from only copying the book as well as preclude others from employing the method as described
in the book without his permission.

The extent of the copyright extends to the idea itself, not merely the expression

The author has an exclusive right to the method described in the book.

Question 21

Refers to a person or organization who controls the collection, holding, processing or use of personal
information, including a person or organization who instructs another person or organization to collect, hold,
process, use, transfer or disclose personal information on his or her behalf.

Personal information controller

Personal information processor

Personal information

Sensitive personal information

Question 22

Data Privacy Act of 2012 covers all except:

Processing all types of personal information

Personal Information controllers and processors

To any natural and juridical person information processing

Information about any individual who is or was an officer of the government institution that relates to the
position or function of the individual

Question 23

No. 1 - The addressee is entitled to regard the electronic data message or electronic document received as that
which the originator intended to send;

No. 2 - If the transmission resulted in any error the addressee in not entitled to regard the electronic data
message or electronic document received as that which the originator intended to send;

Only the first statement is true.

Both statements are true

Only the second statement is true.

Both statements are false

Question 24
Refers to information or the representation of information, data, figures, symbols or other modes of written
expression, described or however represented, by which a right is established or an obligation extinguished;

Electronic signature

Electronic data message

Electronic Key
Electronic document