TITLE IX

Pasig Catholic
Partnership
College
(Art.
1767-
College
1867)
Department
Board Exam Questions
1984-2014

Bachelor of Science in
Accountancy 3rd year
 OCTOBER 1988
Three (3) of the following are similarities
between a partnership and a corporation.
Which is not?
a. The individuals composing both have
little voice in the conduct of the business
b. Both have juridical personality
separate and distinct from that of the
individuals composing them
c. Like a partnership, a corporation can
only act through agents
d. Both are organizations composed of an
aggregate of individuals
ANSWER: A
MAY 1994
Partnership as distinguished from
ownership:
a. It has juridical personality
b. Created not only by agreement of the
parties but also by law
c. Purpose is to make profits
d. Profits are divided in proportion to ones
interest
ANSWER: A
OCTOBER 1994
Which of the following is a characteristic
of partnership as a contract?
a. Formal
b. Innominate
c. Gratuitous
d. Preparatory
ANSWER: D
OCTOBER 1995
Which of the following is an essential
element of partnership?
a. There must be a contribution of
money, property or industry to a
common fund
b. It must be an association for profit with
the intention to divide the profit among
themselves
c. There must be a valid and voluntary
agreement
d. All of them
ANSWER: D
OCTOBER 1997
The following, except one is the common
characteristics of partnership and
corporation. Which is the exception?
a. The individuals composing both
organizations have little voice in the
co-
conduct of the business
b. Both can only act through agents
c. Both are business organizations
composed of a number of individuals
d. Both have juridical personality
separate and distinct from that of the
individuals composing it
ANSWER: A
A and B orally agreed to form a
partnership two (2) years from today,
each one to contribute P10,000. If at the
arrival of the period, one refuses to go
ahead with the agreement, can the other
enforce the agreement?
a. Yes, since the agreement is to be
enforced after one year from the making
thereof, the same should be in writing to
be enforceable
b. Yes, because the prior agreement was
voluntarily made
c. Yes, because the partnership contract
is not governed by the statute of frauds
d. No, because the agreement was d. It has a juridical personality separate
merely oral and distinct from the partners
ANSWER: D ANSWER: C
MAY 2014 MAY 1997
There is partnership except: The following are instances, except one,
when a partnership is unlawful. Which is
a. Two or more parties consent to a
the exception?
contract, oral or written.
a. A partnership formed for smuggling of
b. They give money, property or industry
contraband
to a common fund.
b. A partnership formed to furnish
c. There is division of profits or losses
apartment house to be used as venue for
among themselves.
illegal gambling
d. There is no fiduciary relationship.
c. A partnership formed for the purpose
ANSWER: D of buying public lands

A: Partnership involves a fiduciary d. A partnership formed to create cartel

relation. for monopolies

B: It is preparatory contract. ANSWER: C

C: It is a real and accessory contract. OCTOBER 1984

D: Partnership contract is perfected by Every contract of partnership having a

mere consent. capital of P3,000 or more in money or
property shall appear in a public
a. Statements A, B and D are correct. instrument which must be recorded in
b. Only B is correct. the Securities and Exchange
Commission. Failure to comply with said
c. Only C is correct. requirements:
d. Only D is correct. a. Will not affect the liability of the
ANSWER: A partnership and the members thereof to
third person
MAY 1994
b. Will render the partnership void
The following, except one, are the legal
characteristics of partnership. Which is c. Will not give the partnership a legal
the exception? personality

a. There is mutual agency among the d. Will give the partnership a de facto
partners existence

b. The partners are liable pro-rata for the ANSWER: A

contractual liabilities of the partnership
c. All the partners are liable after
exhaustion of partnership assets to the
extent of their personal property
OCTOBER 1989
When cash or property worth P3,000.00
or more is contributed as capital, the
Articles of Co-partnership shall be in a
public instrument and be registered with
the Securities and Exchange ANSWER: FALSE
Commission. If the said requirements are
NOVEMBER, 1985
not complied with:
All present properties are contributed:
a. It will render the partnership void
a. Universal Partnership
b. It will not affect the liability of the
partnership and the partners to third b. Limited Partnership
parties
c. General Partnership
c. It will not give legal personality to the
partnership d. None of them

d. It will give the partnership a de-facto ANSWER: A

existence Composed of capitalist and industrial
ANSWER: B partners:

MAY 1990 a. Universal Partnership

When the partnership capital is b. Limited Partnership

P3,000.00 or more, it must be in a public c. General Partnership
instrument and must be recorded with
Securities and Exchange Commission d. None of them
(Article 1172). A, B and C agreed to form ANSWER: C
a partnership and each contributed
P10,000.00 as capital of the partnership. Partners shall enjoy practically all the
There was no compliance in the profits:
provisions of Article 1172. a. Universal Partnership
a. The partnership was not established b. Limited Partnership
b. The partnership did not have juridical c. General Partnership
personality
d. None of them
c. The partnership was established and
any partner may compel the execution of ANSWER: A
a public instrument They have no voice in the management
d. The partnership is void of partnership affairs:

ANSWER: C a. Managing partners

MAY 1987 b. Silent partners

True or False: c. Both a and b

The articles of an association is known d. None of them

only to the members and provides that ANSWER: B
any one of the members may contract in
his own name with third persons. The They have priority if partnership is
association has a juridical personality insolvent:
because such association shall be
a. Separate creditors
governed by the law on partnership.
b. Partnership creditors
c. Both a and b d. Secret partner
d. None of them ANSWER: D
ANSWER: B MAY 1995
OCTOBER, 1986 May contribute money, property or
industry to the common fund:
May contribute money, property or
industry to the common fund: a. General partner
a. Both general and limited partners b. Industrial partner
b. Limited partners c. Limited partner
c. General partners d. Managing partner
d. Capitalist partner ANSWER: A
ANSWER: C MAY 1987
One who takes charge of winding up of A and B entered into a universal
partnership affairs upon dissolution: partnership of all present property. The
common property of the partnership shall
a. Silent partner
be:
b. Ostensible partner
a. All the present properties which
c. General partner belonged to each of the partners at the
time of the constitution of the
d. Liquidating partner partnership
ANSWER: D b. All the properties which shall belong to
MAY 1988 each of the partners after the
constitution of the partnership
May contribute money, property or
industry to the common fund: c. All the properties which belonged to
each of the partners at the time of the
a. Limited partner constitution of the partnership as well as
b. General partner the profits which they may acquire
therewith
c. Both limited and general partners
d. All the properties which belonged to
d. None of them each of the partners at the time of the
ANSWER: B constitution of the partnership as well as
the properties which each may acquire
OCTOBER 1994 thereafter
One who takes active part in the ANSWER: C
business but is not known to be a partner
by outside parties is: OCTOBER 1996

a. Silent partner The common property of a universal

partnership of all present property shall
b. Dormant partner be:
c. Nominal partner
a. All the properties which shall belong to
each of the partners after the
constitution of the partnership
b. All the properties which belong to each
of the partners at the time of the
constitution of the partnership
c. All the properties which belong to each
of the partners at the time of the
constitution of the partnership as well as
the profits they may acquire therewith
d. All the properties which belong to each
of the partners at the time of the
constitution of the partnership as well as
the properties which each may acquire
thereafter
ANSWER: C
OCTOBER 1984
True or False
Articles of Universal partnership entered
into without specification of its nature is
presumed to contribute only a universal
partnership of all profits.
ANSWER: FALSE
by the marriage because there is a
Article 1782. Persons who are prohibited
from giving each other any donation or
advantage cannot enter into universal
partnership. (1677)
OCTOBER 1988
The following persons are disqualified to
form a universal partnership. Who are
the exceptions?
a. Brother and sister
b. Husband and wife
c. Those guilty of adultery and
concubinage
d. Those guilty of the same criminal
offense, if the partnership is entered into
a consideration of the same
ANSWER: A
MAY 1997
Which of the following persons are not
disqualified to form a universal
partnership?
a. Those guilty of adultery and
concubinage
b. Husband and wife
c. Those guilty of the same criminal
offense, if the partnership is entered into
in consideration of the same
d. Brother and sister
ANSWER:
MAY 1997
A limited partnership was formed in 1994
by X as general partner and Y and Z as
limited partners. In 1995, X and Z got
married. Did the marriage dissolve or
change the form of the partnership?
1st answer: Yes, partnership is dissolved
change in equity and status among the
partner.
2nd answer: No, because spouses can
enter into a universal partnership
a. Both answers are correct
b. 1st answer wrong, 2nd answer correct
c. Both answers are wrong
d. 1st answer correct, 2nd answer wrong
ANSWER: C
MAY 2014
A partnership that has for its object
determinate things, their use or fruits, or
specific undertaking, or the exercise of a
profession or vocation.
a. Particular 2nd Statement - The general rule is that
the loss of the specific thing contributed
b. General
to the partnership dissolves the
c. Limited partnership when only the use of the
thing is contributed by the partner and
d. Universal such thing after its transfer to the
ANSWER: A partnership which used the same for
sometimes was subsequently lost, the
OCTOBER 1997 partnership is not dissolved.
A and B orally agreed to form a a. 1st statement is true but 2nd
partnership two (2) years from today, statement is false
each one to contribute P10,000. If at the
arrival of the period, one refuses to go b. Both statement are true
ahead with the agreement, can the other c. Both statement are false
enforce the agreement?
d. 1st statement is false but 2nd
a. Yes, since the agreement is to be statement is true
enforced after one year from the making
thereof, the same should be in writing to ANSWER: A
be enforceable
OCTOBER 1984
b. Yes, because the prior agreement was
The remedy of capitalist partners against
voluntarily made
an industrial partner who engaged in a
c. Yes, because the partnership contract business for himself without the express
is not governed by the statute of frauds permission from the partnership is

d. No, because the agreement was a. To oblige the industrial partner to sell
merely oral his interest to the said capitalist partners.

ANSWER: D b. To exclude him from sharing in the

MAY 1987
True or False:
The arrival of the term of a partnership
created for a fixed term or period shall
dissolve the partnership and the partners
shall continue with the business of such
partnership.
ANSWER: FALSE
1st Statement The arrival of the term of
the partnership with a fixed term or
period shall not dissolve the partnership
if the partners continue with business of
the partnership, but such partnership
may be terminated anytime dependent
on the will of the continuing partners.
profits of the partnership.
c. To remove him as manager if he is
appointed as manager of the partnership.
d. To expel him from the partnership and
claim for damages.
ANSWER: D
MAY 2014
This partner cannot engage in business
for himself, unless his partnership
expressly permits him to do so.
a. Industrial
b. General
c. Limited
d. Capitalist
 ANSWER: A
D and C are capitalist partners while F is
an industrial partner in their restaurant
business. Later, F put up a cellular phone
loading stations, sells call cards and
other cellphone accessories. Has F any
liability under the circumstances?
a. No, since his other business is not
competing with the business or the
partnership.
b. Yes, because he cannot engage in
business for himself always.
c. Yes, because he is precluded by law to
engage in any other business, except if
there is stipulation allowing him.
d. No, there is no showing that the
business of the partnership is being
prejudiced.
ANSWER: B
OCTOBER 1984
A partnership suffered losses in the first
year of its operation. X, a capitalist
partner, refused to contribute an
additional share to the capital. Can X be
obliged to sell his interest to the other
partners on the ground of such refusal?
a. Yes, X's refusal to contribute his
additional share reflects his lack of
interest in the continuance of the
partnership.
b. No, because there is actually to
imminent loss of the business.
c. Yes, provided that X to paid the value
of his interest.
d. None of the above.
ANSWER: A
OCTOBER 1988
A is the managing partner of ABC
Company. X owes A personally and ABC
Company P20,000.00 each. A collected
and received from X P10,000.00 and he
issued a receipt wherein it is stated that
the amount paid is applied to his
personal credit.
a. The amount received will be applied in
favor of the partnership credit
b. The amount will be applied in
proportion to both credits
c. The amount received will be applied to
the credit of A
d. All the partners will decide as to whose
favor it will apply
ANSWER: B
MAY 1992
M and O are partners of M & O
partnership. M is the managing partner.
N owes M P10,000.00 and M & O
partnership P30,000.00. The obligations
of N are both due. M collected from N the
debt of N to M in the amount of
P10,000.00 and issued a receipt in the
name of M. To which obligation will the
P10,000.00 be applied?
a. The whole of the P10,000.00 shall be
applied to the debt of N to M
b. The P10,000.00 shall be applied to the
debt of N to the partnership
c. 5,000.00 each to the debts of N to M
and to the partnership
d. P2,500 to the debit of N to M and
P7,500.00 to the debt of N to the
partnership
ANSWER: D
MAY 1995
A is the managing partner in A & B
Company. X is indebted to A for
P20,000.00 and to the partnership for
P60,000.00. When both debts mature, X
pays A for P20,000.00 and the latter
issues a receipt for his personal credit.
The payment of P20,000.00 shall be b. B and C can charge the capital of A
applied: with their share In the P5,000.00
a. in favor of A and in favor of the c. A and B compelled to share with B and
partnership C the P5,000.00
b. To the whole debt owing to A d. B and C can automatically sue D to
collect the P10,000.00
c. in favor of A and in favor of the
partnership ANSWER: C
d. To the debt owing to the partnership OCTOBER 1984
ANSWER: A True or False
MAY 1988 The partnership suffered damages in a
X, Y and Z are equal partners of XYZ particular undertaking through the fault
Partnership. A owes the XYZ Partnership of a partner. However, through the efforts
for P9,000. Z, a partner collected from A of the partner at fault on other activities,
P3,000 before X and Y received anything. the partnership realized unusual profits.
Z issued a receipt on the P3,000 as his He can compensate the damages
share of what A owes. When X and Y suffered by the partnership through his
collected from A, A was insolvent. fault with the unusual profits earned by
a. Partner Z shall share partners X and Y the partnership through his industry.
with P3,000 ANSWER: TRUE
b. Z cannot be required to share X and Y MAY 1989
with the P3,000
Bears the loss of the property
c. X and Y should first exhaust all contributed to the partnership:
remedies to collect from A
a. Capitalist partner
d. X and Y can automatically deduct from
the capital contribution of Z in the b. Limited partner
partnership their respective share in the
c. Partners contributing usufructuary
P3,000
rights
ANSWER: A
d. None of the above
MAY 1992
ANSWER: D
A, B and C are general partners in ABC
MAY 1992
Partnership. D is a debtor to the
partnership in the amount of P15,000.00. C, P and IP are partners. IP is the
A received from debtor D the sum of industrial partner, who in addition to his
P5,000.00 and issued a receipt services also contributed capital to the
identifying the amount as his share. Then partnership. There is no stipulation as to
D became insolvent and B and C cannot the sharing of profits and losses. The
collect the P10,000.00 partnership realized profits of
P21,000.00. The share of IP in the profits:
a. A cannot be compelled to share the
P5,000.00 with B and C a. C and P will determine IPs share in the
profits
b. IPs share is P7,000.00 d. Only B and C are correct.
c. Pro-rata to his contributed capital ANSWER: C
d. Nothing because he is an industrial OCTOBER 1990
partner
In a partnership of A. B and C, A was
ANSWER: C appointed in the Articles of Co-
partnership as managing partner. As such
OCTOBER 1984
manager:
True or False
a. His power is revocable even without
One of the partners in a proposed cause
partnership is a multi-millionaire. The
b. His power can be revocable at any
stipulation in the contract of partnership
time even without just cause
that this partner shall be excluded from
sharing in the profits of the partnership is c. He may execute all acts of
valid. administration despite the opposition of
B and C
ANSWER: FALSE
d. He can be removed for valid cause
MAY 2014
even without the vote of the partners
A stipulation which excludes one or more owning the controlling interest
partners from any share in the profits or
ANSWER: C
losses is-
MAY 2014
a. Void
A: An agreement which excludes one or
b. Valid
more partners from shares in the
c. Unenforceable profits or losses is valid as long as
it is voluntary.
d. Voidable
B: A power as managing partner granted
ANSWER: A after the partnership has been
A: An agreement which excludes one or constituted may be revoked at any
more partners from shares in the profits time.
or losses is valid as long as it is voluntary. C: None of the partners may make any
B: A power as managing partner granted important alteration in the
after the partnership has been immovable property of the
constituted may be revoked at any time. partnership even if useful to the
partnership without the consent of
C: None of the partners may make any all partners.
important alteration in the immovable
property of the partnership even if useful a. All statements are correct.
to the partnership without the consent of b. Only C is correct.
all partners.
c. Only B is incorrect.
a. All statements are correct.
d. Only B and C are correct.
b. Only C is correct.
ANSWER: D
c. Only B is incorrect.
 MAY 2014
A: An agreement which excludes one or
more partners from shares in the
profits or losses is valid as long as
it is voluntary.
B: A power as managing partner granted
after the partnership has been
constituted may be revoked at any
time.
C: None of the partners may make any
important alteration in the
immovable property of the
partnership even if useful to the
partnership without the consent of
all partners.
a. All statements are correct.
b. Only C is correct.
c. Only B is incorrect.
d. Only B and C are correct.
ANSWER: D
MAY 1987
A capitalist partner engaged for his own
account in an operation, which is of the
kind of business in which the partnership
is engaged. Said partner can be:
a. Compelled to sell his interest in the
partnership to the other capitalist
partners
b. Compelled to dissolve or discontinue
the operation of his business
c. Compelled to bring to the common
fund of the partnership any profits
accruing to him from his transactions
d. Denied his share in the profits of the
partnership
ANSWER: C
OCTOBER 1988
A is the capitalist partner and B is the
industrial partner. A engaged personally
in the same business the partnership is
engaged in.
a. If there are losses, the partnership
shall bear the losses
b. If there are profits, the profits will be
shared by A and the partnership
c. If there are profits, A will give the
profits to the partnership
d. A will be excluded from the
partnership and pay damages
ANSWER: C
MAY 1989
A, B and C are general partners in ABC
Company. A, the managing partner
engaged personally in a business that is
the same as the business of the
partnership without the consent of B and
C
a. If there are profits, A will give the
profits to the partnership
b. If there are losses, the partnership will
bear the losses
c. If there are profits, they will be shared
by partners A and ABC Company
d. The profits or losses will be shared by
A and the partnership
ANSWER: A
MAY 1989
Three (3) of the following are rights of a
general partner and also of a limited
partner in a limited partnership. Which is
not?
a. To inspect and copy at a reasonable
hours the book of the partnership and
have them kept at the principal place of
a business
b. To demand true and full information of
all matters affecting the partnership and
a formal account of partnership affairs
c. To have dissolution and winding up by
decree of court
d. None of the above
ANSWER: D
MAY 1990
Three of the following are rights of
partner. Which is not?
a. Right to associate another person in
his share
b. Right to admit another partner
c. Right to inspect and copy partnership
book
d. Right to ask dissolution of the firm at
the proper time
ANSWER: B
OCTOBER 1990
X and Y established a partnership by
contributing P50,000.00 each. Z, a third
party allowed his name to be included in
the firm name of the partnership. After
exhausting the partnership assets, there
was left a liability to third persons
amounting to P30,000.00 The creditors
can compel:
a. Z to pay the P30,000.00 remaining
liability
b. X, Y and Z to pay P10,000.00 each
c. X or Y to pay the P30,000.00 remaining
liability
d. X and Y to pay P15,000.00 each
ANSWER: B
OCTOBER 1990
W, X, Y and Z formed a partnership. W, X
and Y are general partners, who
contributed P50,000.00 each, while Z an
industrial partner, his services only. All
the partners signed an agreement
stipulating that the liability of W is
limited to his contribution. After all the
assets of the partnership were been
exhausted, there remains an unpaid
liability of P40,000.00. The creditors of
the partnership can compel:
a. X and Y to pay the P40,000.00
b. X, Y and Z to pay the P40,000.00
c. W, X, Y and Z to pay P10,000.00 each
and W and Z can demand
d. X and Y to pay P40,000.00
ANSWER: C
MAY 1991
A and B are capitalist partners, with C as
industrial partner. A and B contributed
P15,000.00 each to the capital of the
partnership. A contractual liability of
P40,000.00 was incurred by the
partnership in favor of X. In the case at
bar, the capital assets of P30,000.00
shall first be exhausted thereby leaving
an unsatisfied liability of P10,000.00 X
can recover the amount from:
a. A and B only
b. A, B and C
c. A, B and C and C can recover
reimbursement from A and B
d. Answer not given
ANSWER: C
MAY 1992
F, G, H and I are partners. They
contributed capital as follows: F-
P50,000.00; G-P30,000.00; H-P20,000.00
and I, as an industrial partner and his
services. The partnership obligation to
outsiders exceeds the total net assets by
P18,000.00. Who and by how much will
the partners be liable for the payment of
P18,000.00?
a. F P9,000.00 ; G P5,400.00 ; H
P3,600.00 I - Nothing
b. F P4,500.00 ; G 4,500.00 ; H
P4,500.00 I- P4,500.00
c. F P6,000.00 ; G P6,000.00 ; H
P6,000.00 I-Nothing
d. F P4,500.00 ; G- P2,700.00 ; H
P1,800.00 I P9,000.00
ANSWER: B
OCTOBER 1995
A and B are capitalist partners with C as
industrial partner. A and B contributed
P20,000 each to the capital of the
partnership. A contractual liability of
P50,000 was incurred by the partnership
in favor of X. The assets of the
partnership has obligations of the
partners, if any?
a. A, B and C are liable to X and C after
and C after giving his share may ask
reimbursement from A and B, unless
otherwise stipulated
b. A and B only
c. C only
d. A, B and C and C has no right for
reimbursement from A and B unless
expressly stipulated
ANSWER: A
MAY 1997
XYZ Partnership composed of three (3)
capitalist partners and one industrial
partner suffered business losses. Its
remaining assets amounted to P100,000.
The partnership is indebted to its
supplier, Mr. Cruz, in the amount of
P160,000. How can Mr. Cruz recover the
P60,000?
a. Mr. Cruz can recover from the
partnership P100,000 and the balance of
P60,000 from the three capitalist
partners only
b. Mr. Cruz can recover from the
partnership P100,000 and the balance of
P60,000 from any of the partners
solidarily
c. Mr. Cruz can recover from the
partnership P100,000 and the balance of
P60,000 from the four partners jointly
including the industrial partner
d. Mr. Cruz can recover from the
partnership P100,000 only and suffer as
his loss the balance of P60,000
ANSWER: C
MAY 2014
These partners shall be liable pro rata
with all their property and after all the
partnership assets have been exhausted.
a. Only capitalist partners.
b. Only general partners.
c. All partners, including industrial ones.
d. Only limited partners.
ANSWER: A
MAY 1990
A, B and 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. Then B and C
bought-out A from the partnership and
thereafter X bought all the trucks with a
big profit for B and C.
a. The sale of the trucks to X is void
because it is without the knowledge and
consent of A
b. B and C are liable to A whatsoever
c. B and C are liable to A for his share in
the profits of the sale
d. When A was bought-out of the
partnership, the partnership was
dissolved so A has no more share in the
profits of the sale
ANSWER: C
OCTOBER 1996
Anton, Ben and Cris are partners in a
joint venture engaged in real estate and
land development. Anton, without the
knowledge of Ben and Cris, offered to sell
to Don all the remaining unsold lots at a
price very much higher than the
prevailing market prices. A while later,
Anton bought out Ben and Cris from the
partnership and thereafter finally sold all
the lots at a very big profit.
1st conclusion: When Anton bought Ben
and Cris from the partnership, the
partnership was dissolved so Ben and
Cris have no more share in the profit of
the sale.
2nd conclusion: the sale of the lots
between Anton and don is void because
it was without the knowledge and
consent of Ben and Cris.
a. Both conclusions are correct
b. Both conclusions are wrong
c. 1st conclusion wrong, 2nd conclusion
correct
d. 1st conclusion correct, 2nd conclusion
wrong
ANSWER: B
OCTOBER 1997
Which of the following is not a requisite
prescribed by law in order that a
partnership may not be held liable to a
third party for the act of one of its
partners?
a. The partner binds the partnership by
acquiescence for obligations he may
have contracted in good faith
b. The partner must have the authority to
bind the partnership
c. The contract must be in the
partnership name or for its account
d. The partner must act on behalf of the
partnership
ANSWER: A
MAY 1988
Aguas and Bautista are partners in a real
estate partnership. The partnership owns
a piece of land which Castro desired to
buy. Castro contacted Aguas and inform
Bautista out of the partnership and
afterwards sold the land to Castro with a
big profit.
a. The partnership is dissolved when
Aguas became the sole owner
b. The sale of the land to Castro is void
because it was without the knowledge of
Bautista
c. Aguas is not liable to Bautista for the
latters share in the profits
d. Aguas is liable to Bautista for the
latters share in the profits
ANSWER: D
OCTOBER 1988
A and B are partners in a real estate
business. A and B were approached by X,
who offered to buy parcel of land owned
b the partnership. Thereafter, B sold to A
Bs share in the partnership. Then A sold
the land to X at a big profit.
a. A is liable to B for Bs share in the
profit
b. The partnership is dissolved when A
became the sole owner
c. A is not liable to B for the latters share
in the profit
d. The sale of the land to X is void
 ANSWER: C
MAY 2014
A: The partnership is bound to make
good the loss where one partner acting
within an apparent authority receives
money or property of a third person and
misapplies it.
B: A person accepted as a partner into an
existing partnership is liable for all
obligating of the partnership even those
arising before his entry to the
partnership.
C: The creditors of the partnership shall
be preferred to those of each partner as
regards the partnership property
a. All statements are correct.
b. Only B is wrong.
c. Only C is true.
d. B and C are correct.
ANSWER: A
OCTOBER 1984
A, B and C are partners in X and Co. D
represented himself as a partner in X and
Co. to E who on the faith of such
representation extended P10,000 credit
to X and Co. Assuming only A and B
consented to such representation, who
shall be held liable to E?
a. Since E extended the P10,000 credit to
X and Co., a partnership liability exists,
thus, all the partners and D are liable.
b. Only A, B and D are partners by
estoppel and, thus, are liable pro-rata to
E.
c. Only D, who made the representation
shall be liable to E.
d. Only partners A, B and C who
benefited from the credit extended by E
shall be liable to E.
ANSWER: B
MAY 1988
A, B and C are partners in ABC Company.
D represented himself as a partner in
ABC Company to E, who on the belief of
such representation, extended a P50,000
credit to ABC Company. Assuming only B
and C consented to such representation,
who will be liable to E?
a. E extended the credit to the ABC
Company, so a partnership liability
exists, thus, all the partners, A, B, and C
are liable
b. B, C, and D are partners by estoppel
and thus, are liable pro-rata to E
c. Partners A, B and C who benefited from
the credit extended by E are liable
d. D who made the representation is
liable to E
ANSWER: B
OCTOBER 1988
A and B are equal partners in AB
Company. Y represented himself as a
partner in AB Company to Z who relying
on such representation, extended a
P50,000.00 credit to AB Company. Of the
two partners, only B knew and consented
to the representation of Y. Who should be
held liable to Z?
a. Only Y who represented himself as
partner is liable
b. Since the credit is extended to AB
Company, a partnership liability was
created so the two partners and Y are
liable
c. Partners A and B who benefited from
the cred extended to the partnership
shall be liable to Z
d. B and Y are partners by estoppel and
thus, are liable to Z
 ANSWER: D
MAY 1989
A, B and C are partners in ABC Company.
D introduced himself as partner in ABC
Company to X, who in the belief of such
introduction, extended a P40,000.00
credit to ABC Company. These facts are
known to A who did not oppose. Who
shall be held liable to X?
a. Since X extended the credit to ABC
Company, a partnership liability exists,
thus, partners A, B, C and D are liable
b. Only A, who knows the transactions,
and D are partners by estoppel who are
liable pro-rata to X
c. D who represented himself as a
partner in ABC Company is liable
d. A, B and C, who benefited in the
P60,000.00 credit shall be liable to X
ANSWER: B
MAY 1990
A and B are equal partners in AB
Company. C contacted XYZ Company and
represented himself as partner in AB
Company. XYZ Company contacted A
who confirmed that C is in fact a partner
of AB Company. XYYZ Company extended
credit to C for AB Company in the
amount of P60,000.00. Who are liable to
XYZ Company?
a. A and C are partners by estoppel and
are liable to XYZ Company
b. XYZ Company extended the credit to C
for AB Company so a partnership liability
exists, so both partners, A and B together
with C are liable
c. AB Company benefited, so it is liable
d. Only C who made the representation is
liable
ANSWER: A
MAY 1994
Statement 1 Holding out by certain
persons to the public that they are
partners, when actually they are not,
leads to the legal existence of
partnership by estoppel in which case the
liability that results is a partnership
liability and since there may be no
partnership assets available, the partners
in estoppel are equally liable for the
partnership debt with their separate
properties.
Statement 2 Consenting to or
permitting another to act as partner of an
actual partnership although the persons
consenting is not actually a partner of
that existing partnership, in which case,
any of the actual partners consenting to
another person who is not a member of
the partnership is liable but not the
partnership. Which is correct?
a. First statement is true but second
statement is false
b. Both statement are false
c. Both statement are true
d. First statement is false but second
statement is true
ANSWER: C
OCTOBER 1997
X, Y and Z are partners in Able Co. W
represented himself as a partner in Able
Co. B, who on the faith of such
representation, granted P300,000 loan to
the partnership. Assuming only X and Y
consented to such representation, who
shall be liable to B?
a. Since the partnership benefited from
the credit extended by B, all partners X,
Y and Z are liable
b. Only X, Y and W who are partners by
estoppel are liable pro-rata to B
c. Since the loan was extended to the
partnership, all the partners and W are
liable
d. Only W who made the representation
shall liable to B
ANSWER: B
MAY 1991
A B and C are capitalist partners engaged
in a retail business. Their contribution is
P20,000.00 each. D is admitted as a new
partner with a contribution of
P80,000.00. At the time of his admission,
the partnership has an outstanding
obligation to E in the amount of P80,000.
In this case:
a. D is not liable to E for this obligation
b. D is liable to E for tis obligation so that
the amount of P68,000.00 will be
exhausted leaving a balance
P12,000.00 and only A, B and C shall be
liable or jointly or pro-rata, out of their
separate property
c. Answer not given
ANSWER: B
OCTOBER 1992
A and B are equal partners in AB
partnership by contributing P50,000.00
each on July 1991. On July 2, 1991, the
partnership contracts an obligation to
pay Z the amount of P180,000.00 on
August 15, 1991. On August 1, 1991, C
was admitted as a new partner. C
contributed P50,000.00. How will the
obligation be paid?
a. A P60,000.00 ; B P60,000.00 ; C
P60,000
b. A 90,000.00 ; B P90,000.00 ; C
None
c. A P65,000.00; B P65,000.00 ; C
P50,000.00
d. A P180,000.00 ; B P180,000.00 ; C
None
ANSWER: C
MAY 1994
Can the partners stipulate that the newly
admitted partner shall not be held liable
for the obligations of the partnership
arising before his admission? Which of
the following answer is not correct?
a. No, because third persons are always
protected by law
b. No, because the newly admitted
partner should be deemed to have
assume all the debts of the partnership
upon his voluntary participation in the
partnership
c. No, because the subject of the
stipulation is that the liability of the new
of partner should not be satisfied out of the
partnership property
d. No, because a newly admitted partner
is liable with respect to his capital
contribution which forms part of the
partnership.
ANSWER: C
OCTOBER 1994
Can the partners stipulate that the newly
admitted partner shall not be liable for
the obligations of the partnership arising
before his admission? Which of the
following answer is not correct?
a. No, because the newly admitted
partner should be deemed to have
assume all the debts of the partnership
upon his voluntary participation in the
partnership
b. No, because a newly admitted partner
is liable with respect to his capital
contribution which forms part of the
partnership
c. No, because third persons are always
protected by law
d. No, because the subject of the
stipulation is that the liability of the new
partner should not be satisfied out of the
partnership property
ANSWER: D
OCTOBER 1995
A and B are partners. On June 15, 1992,
when the obligation of the partnership
totals P80,000, C was admitted as a new
partner. At the time of Cs admission, the
partnership creditors were M for P50,000
and N for P30,000. After June 15, 1992,
the partnership borrowed from O P20,000
and P40,000 from P. On December 15,
1992, the partnership becomes insolvent
leaving an obligation totaling P140,000
and partnership assets amounting to
P30,000. The creditors are going after
the separate properties of the partners to
satisfy their remaining claims. How are
the creditors claims satisfied?
Answer 1 M and N can go after the
separate properties of A and B, but Cs
separate properties are not answerable
to their claims.
Answer 2 O and P can go after the
separate properties of A, B and C.
a. Both answers are wrong
b. Answer 1 is wrong but answer 2 is
correct
c. Both answers are correct
d. Answer 1 is true but answer 2 is wrong
ANSWER: C
MAY 2014
A: The partnership is bound to make
good the loss where one partner acting
within an apparent authority receives
money or property of a third person and
misapplies it.
B: A person accepted as a partner into an
existing partnership is liable for all
obligating of the partnership even those
arising before his entry to the
partnership.
C: The creditors of the partnership shall
be preferred to those of each partner as
regards the partnership property
a. All statements are correct.
b. Only B is wrong.
c. Only C is true.
d. B and C are correct.
ANSWER: A
OCTOBER 1988
B-1, B-2 and B-3 are equal partners in 3
Brothers Partnership. The partnership is
indebted to PC for P150,000. Partner B-1
is indebted to SC for P20,000. PC
attached and took all the assets of the
partnership amounting to P90,000. B-2
and B-3 are solvent while B-1 is insolvent
and all what he owns is a land valued to
P15,000.
a. SC has priority to the land of B-1 as a
separate creditor.
b. PC has priority to the land of B-1 to
cover B-1's share of the P60,000
remaining liability of the partnership.
c. B-2 and B-3 have priority to the land of
B-1 if they paid PC the P60,000 liability of
the partnership.
d. PC and SC shall both have priority to
the land of B-1 in proportion to their
claims of P60,000.00 and
P20,000.00,respectively
ANSWER: A
MAY 1989
The partnership is insolvent. They are
preferred as regards to the partnership
assets:
a. Partnership creditors
b. Partners separate creditors
c. Partners with respect to capital
d. Partners with respect to profits
ANSWER:
OCTOBER 1989
B-1, B-2 and B-3 are equal partners in 3-
Brothers Partnership. The partnership is
indebted to PC for P150,000.00. Partner
B-1 is indebted to SC for P20,000.00. PC
attached and took all the assets of the
partnership amounting to P90,000.00. B-
2 and B-3 are solvent, while B-1 is
insolvent and all what he owns is a land
valued at P15,000.00
a. SC has priority to the land of B-1 as a
separate creditor
b. PC has priority to the land of B-1 to
cover B-1s share in the P60,000.00
remaining liability of the partnership
c. B-2 and B-3 have priority to the land of
B-1 if they paid PC the P60,000.00
remaining liability of the partnership
d. PC and SC shall both have the priority
to the land of B-1 in proportion to their
claims of P60,000.00 and
P20,000.00,respectively
ANSWER: A
MAY 2014
A: The partnership is bound to make
good the loss where one partner acting
within an apparent authority receives
money or property of a third person and
misapplies it.
B: A person accepted as a partner into an
existing partnership is liable for all
obligating of the partnership even those
arising before his entry to the
partnership.
C: The creditors of the partnership shall
be preferred to those of each partner as
regards the partnership property
a. All statements are correct.
b. Only B is wrong.
c. Only C is true.
d. B and C are correct.
ANSWER: A
OCTOBER 1988
One of the following incidents may be a
cause for involuntary dissolution of a
partnership. Which is?
a. Termination of the term of the
partnership
b. Insolvency of any partner
c. Express will of any partner
d. Expulsion of any partner
ANSWER: B
OCTOBER 1994
1st Statement The arrival of the term of
the partnership with a fixed term or
period shall not dissolve the partnership
if the partners continue with business of
the partnership, but such partnership
may be terminated anytime dependent
on the will of the continuing partners.
2nd Statement - The general rule is that
the loss of the specific thing contributed
to the partnership dissolves the
partnership when only the use of the
thing is contributed by the partner and
such thing after its transfer to the
partnership which used the same for
sometimes was subsequently lost, the
partnership is not dissolved.
a. 1st statement is true but 2nd
statement is false
b. Both statement are true
c. Both statement are false b. Equal to the share of B
d. 1st statement is false but 2nd c. Equal to the share of C
statement is true
d. Nothing
ANSWER: A
ANSWER: D
MAY 1997
MAY 1988
Which of the following incidents may be a
A, B and C are partners in a partnership.
cause for involuntary dissolution of a
C contributed his industry. A and B
partnership?
contributed P5,000 and 10,000,
a. Expulsion of any partner respectively to the common fund. After
payment of the partnership obligations,
b. Termination of the term of the
only P6, 000 cash remains. No other
partnership
assets. In the absence of terms to the
c. Insolvency of any partner contrary, the share of C in the remaining
assets is:
d. Express will of any partner
a. Equal to the share of A
ANSWER: C
b. Equal to the share of B
MAY 1992
c. P2 ,000
A, B and C are partners in D-3
partnership. On April 29, 1992, partner C d. Nothing
died. On May 1, 1992, not knowing that C
ANSWER: D
died, A contracted a liability to D who
also do not know of the death of C. The If a partner in a partnership is insolvent,
partnership is in the amount of P30,000. the first order of preference in the
D can collect: distribution of his assets are:
a. P30,000.00 from A a. Partnership creditors
b. P15,000.00 from A and P15,000 from B b. Partners contribution to the
partnership
c. P10,000.00 from the estate of C:
P10,000.00 from A and P10,000.00 from c. Separate creditors of the debtor
B
d. Pro-rata between separate creditors
d. P20,000.00 from A and P10,000.00 and partnership creditors
from B
ANSWER: C
ANSWER: C
OCTOBER 1986
MAY 1990
A, B and C are partners. A contributed his
A contributed P30,000.00; B P15,000.00
services only. B, P20, 000; and C, P10,
and C as industrial partner, his services
000. The partnership was liquidated.
in the partnership. After payment of all
After payment of the partnership
liabilities and expenses, only P18,000.00
obligation, only 9,000 worth of assets
remains as partnership assets.
remained. The share of A will be equal to:
a. P3, 000
a. A P12,000.00 B P6,000.00 C This is the order of preference in the
None liquidation of general partnership:
b. A 6,000.00 B P6,000.00 C a. Outside creditors; partners as
P6,000.00 creditors; partners capital, partners
profits
c. A P9,000.00 B P9,000.00 C
None b. Partners as creditors; outside creditors;
partners capital, partners profits
d. A P8,000.00 B P4,000.00 C
P6,000.00 c. Partners capital, outside creditors;
partners as creditors; partners profits
ANSWER: A
d. Outside creditors; partners capital,
This is the order of preference in the
partners profits; outside creditors
liquidation of partnership:
ANSWER: A
a. Outside creditors; partners capital;
partners profits; partners aside from OCTOBER 1995
capital and profit
Which of the following liabilities of the
b. Partners capital; partners profits; partnership shall ran first in the order of
partners aside from capital and profits; payment?
outside creditors
a. Those owing to creditors other than
c. Outside creditors; partners aside from partners
capital and profit; partners capital;
b. Those owing to partners in respect to
partners profits
profits
d. Partners aside from capital and profits;
c. Those owing to partners in respect of
outside creditors; partners capital;
capital
partners profits
d. Those owing to partners other than for
ANSWER: C
capital and profits
OCTOBER 1990
ANSWER: A
In ABC Partnership, A and B contributed
OCTOBER 1996
P20,000.00 each and C his services. After
paying all creditors of the partnership, X, Y and Z are partners who contributed
only P18,000.00 in cash remains. In the to the partnership P40,000, P30,000 and
absence of terms to the contrary, the services, respectively. The partnership
share of C is equal to: was later liquidated and after payment of
the partnership indebtedness, only
a. P6,000.00
P20,000 worth of assets remained. How
b. The share of A much is the share of Z?
c. The share of B a. Zero
d. Nothing b. Equal to the share of X
ANSWER: D c. Equal to the share of Y
MAY 1992 d. P6,000
ANSWER: A
Which of the following liabilities of the partner only with respect to the return of
partnership shall rank first in the order of his contribution
payment?
ANSWER: A
a. Those owing to creditors other than
OCTOBER 1997
partners
Which of the following is not correct? In a
b. Those owing to partners in respect of
limited partnership composed of A, B and
profits
C, the contribution may be as follows:
c. Those owing to partners in respect of
a. A-cash (limited partner); B-cash
capital
(general partner); C-services (general
d. Those owing to partners other than for partner)
capital and profits
b. A-property (limited partner); B-service
ANSWER: A (general partner); C-services (general
partner)
OCTOBER 1997
c. A-services (limited partner); B-cash
If a partner is insolvent, the first order of
(general partner); C-services (general
preference in the distribution of his
partner)
assets is:
d. A-cash (limited partner); B-property
a. Partnership creditors
(general partner); C-services (general
b. Partners contribution to the partner)
partnership
ANSWER: C
c. Separate creditors of the debtor
MAY 1995
d. Pro-rata between the separate
A limited partner who takes active part in
creditors and the partnership creditor
the management of the firm becomes:
ANSWER: C
a. A managing partner
MAY 1995
b. Liable as a general partner
Which of the following statements is not
c. A general partner
correct?
d. A general and a limited partner at the
a. A limited partner in a limited
same time
partnership manages the business of the
partnership but cannot perform acts of ANSWER: B
ownership without the consent of all the
OCTOBER 1984
limited partners
Three of the following enumeration are
b. Valid contribution of a limited partner
rights of a general partner in a limited
are money and property but not services
partnership which are also enjoyed by a
c. Additional limited partners may be limited partner. Which among them is the
admitted into the limited partnership exception?
with the consent of all the partners
a. To have the books of the partnership
d. A person who is both a general and a kept at the principal place of business of
limited partner is deemed a limited
the partnership, and at a reasonable hour ANSWER: C
to inspect and copy any of them.
MAY 1987
b. To have on demand true and full
True or False:
information of all things affecting the
partnership and a formal account of A person who is a general partner in a
partnership affairs whenever limited partnership cannot be a limited
circumstances render it just and partner in the same partnership at the
reasonable. same time because the personality of a
limited partners and his own differ as to
c. To have dissolution and winding up by
liabilities and rights.
decree of court.
ANSWER: FALSE
d. To have all the rights and be subject to
all the restrictions and liabilities of a OCTOBER 1988
partner in a partnership without limited
partners. A partnership is not dissolved upon the
death of a:
ANSWER: C
a. General Partner
OCTOBER 1989
b. Industrial Partner
Three (3) of the following are rights of a
general partner and also of a limited c. Limited Partner
partner in a limited partnership. Which is d. General-Limited Partner
not?
ANSWER: C
a. To inspect and copy at reasonable
hours the books of the partnership and OCTOBER 1989
have them kept at the principal place of The partnership is not dissolved upon the
business. death of a:
b. To demand true and full information of a. General partner
all matters affecting the partnership and
a formal account of partnership affairs. b. Limited partner

c. To have dissolution and winding up by c. Industrial partner

decree of court. d. General limited partner
d. To have all the rights and be subject to ANSWER: B
all the restrictions and liabilities of a
partner in a partnership without limited
partners.