ICARE Accountancy Review Past Paper PDF 2020

No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines...

No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] Regulatory Framework for Business Transactions First Open Preboard 1) A, B and C wrote a promissory note which states “I promise to pay P12,000 to D, E, F and G.” How much may D validly collect from A? a. P12,000 b. P4,000 c. P3,000 d. P1,000 2) On January 15, 2021, S sold his specific car to B at an installment price of P600,000 at P10,000 per month starting on February 1, 2021. In order to secure the payment of the price, B entered into a chattel mortgage over the said car with S. After religiously paying the monthly installments, B defaulted on October 1, 2021 monthly installment. What legal remedy is available to S? a. File an action for exact fulfillment b. Cancel the contract of sale c. Foreclose the chattel mortgage constituted on the car d. Any of the above 3) M, a minor, orally borrowed P10,000 cash from L. In order to secure his obligation, M orally pledged and delivered the cellphone of his father to L. What is the status of contract of pledge? a. Rescissible contract b. Voidable contract c. Unenforceable contract d. Void contract 4) L, a lawyer rode a taxi, driven and operated by O. After arriving at the destination, L mistakenly paid P200 to O instead of the P300 fare stated in the taxi meter. What is the source of obligation as regards to the difference of P100? a. Solutio indebiti b. Contract c. Negotiorum gestio d. Culpa aquiliana 5) D is indebted in the amount P12,000 to C. At the maturity date, D offered his cellphone as payment for his obligation and such offer was accepted by C. The said cellphone has historical cost of P10,000 and accumulated depreciation of P2,000 with fair market value of P9,000. How much of D’s obligation is extinguishment by the transfer of ownership of the said cellphone to C? a. P8,000 b. P9,000 c. P10,000 d. P12,000 6) In the absence of agreement among the partners, when does the juridical personality of the partnership commence? a. At the date of execution of articles of co-partnership b. At the date of submission of articles of co-partnership to SEC c. At the date of issuance by SEC of certificate of registration d. At the date of receipt by the partnership of certificate of registration from SEC 1|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 7) A, B and C formed ABC Partnership with capital contribution of P15,000, P35,000 and P50,000, respectively. The partners agreed to divide partnership loss in the ratio of 6:1:3 for A, B and C, respectively. On the first year of operation, the partnership reported a profit of P30,000. How much shall be the share of A in the said profit? a. P18,000 b. P4,500 c. P10,000 d. Just and equitable share 8) D borrowed P10,000 cash from C. They agreed that D will pay C when his means permits him to do so. What is the classification of this obligation? a. Obligation with a suspensive condition b. Obligation with a resolutory condition c. Obligation ex die d. Obligation in diem 9) Which of the following oral and executory contracts must be in writing to be enforceable? a. Contract of lease of a car for a period of two (2) years b. Contract of subscription of shares of stocks with issue price of P500 c. Contract of guaranty securing a loan with principal amount exceeding P500 d. Contract for a piece of work of a cake with contract price of P500 10) What is the prescriptive period of action based on redhibitory defect of animal? a. 3 days from the date of delivery b. 40 days from the date of delivery c. 6 months from the date of delivery d. 1 year from the date of delivery 11) P orally authorized A to sell his land at a price of P100,000. A orally sold the land in P’s name to B, an insane person, at a price of P20,000. Delivery and payment will happen after one month. What proper legal remedy is applicable to the injured party? a. Action for declaration of nullity b. Action for annulment of contract c. Action for rescission of contract d. None because the contract is unenforceable 12) Which of the following statements concerning an obligation is correct? a. Indivisibility of an obligation implies solidarity. b. When all the requisites of legal compensation are present, both debts to the concurrent amount are extinguished from the moment the parties obtain knowledge of the compensation. c. The debtor of a thing may compel the creditor to receive a different prestation if the latter is of the same value or more valuable than that which is due. d. Whenever a period is designated in an obligation, the law prima facie presumes that the period is for the benefit of both debtor and creditor. 2|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 13) Which of the following statements concerning the characteristics of different types of contract is correct? a. Contract of loan is a consensual contract because it is perfected by mere consent on the amount of consumable thing to be delivered. b. Contract of sales is a real contract because the delivery of the determinate thing is necessary for the transfer of ownership to the buyer. c. Contract of real estate mortgage is a principal contract because it is extinguished when the contract of loan is settled. d. Contract of agency is a preparatory contract because it is a means by which other contracts may be entered into. 14) D is indebted in the amount of P100,000 to C as evidenced by a written contract of loan. The contract provides for 6% interest per annum and 10% penalty in case of breach of contract. At the date of maturity of the loan, D defaulted. Which of the following statements is correct? a. C may only demand payment of the 6% interest in addition to the principal because the law presumes that the interest already covers the penalty. b. C may only demand payment of the 10% penalty in addition to the principal because in obligation with penal clause, the penalty substitutes for the interest and damages. c. C may demand payment of both 6% interest and 10% penalty in addition to the principal only if he can prove that D acted fraudulently. d. C may validly demand payment of both 6% interest and 10% penalty in addition to the principal. 15) On January 1, 2010, S orally sold and delivered a specific house and lot to B at a price of P1,000,000. They agreed that payment of the price shall be made on July 1, 2010. The parties agreed that in case of non-payment of the price, the contract of sale will be automatically cancelled without intervention of the court of law. It is already July 2,2010 but B has not yet paid the price. Which of the following statements is correct? a. The contract of sale is automatically cancelled on July 1, 2010. b. S cannot maintain an action for the price against B because the contract of sale is unenforceable. c. The contract of sale is null and void because of the absence of price which is the cause or consideration of the sale. d. B may still pay the price of the contract of sale after July 1, 2010. 16) On January 1, 2001, S and B agreed in writing for the sale of specific TV at a price of P10,000. The terms of the contract provide the delivery of the TV shall be made on January 5, 2001 while the payment of the price is on a deferred term to be made on April 1, 2001. On January 5, 2001, S failed to deliver the TV set despite extrajudicial demand for the delivery made by B. Which of the following is correct? a. S may exercise his right of possessory lien because he has not yet received the price. b. S may exercise his right of stoppage in transitu because he is an unpaid seller. c. B may file an action for specific performance with damages against S. d. B may file an action for declaration of nullity of the contract of sale. 3|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 17) On January 1, S delivered a specific laptop to B under a sale or return arrangement. S gave B up to April 1 to return the specific laptop. On March 1, the specific laptop was destroyed by fire without B’s fault. Which of the following is correct? a. B is not required to pay the price of the laptop because the obligation is extinguished by fortuitous event. b. S is still the owner of the specific laptop since B has not yet signified his approval or satisfaction of the said item. c. B will become owner of the specific laptop only upon full payment of the price. d. S can collect the price even if the loss is without B’s fault. 18) A stole the specific cellphone of B. Afterwards, A sold at a price of P10,000 the said specific cellphone to C who acquired the said item in good faith and for value. Which of the following statements is correct? a. B may recover the said cellphone from C even without reimbursing C. b. B may recover the said cellphone from C but with obligation to reimburse P10,000. c. C obtains good title over the cellphone because he is a purchaser for value and in good faith. d. C obtains a voidable title over the cellphone which is valid and binding until annulled. 19) A and B orally entered into a contract of sale of a specific authentic Coach bag at a price of P10,000. A paid an arras money at the time of constitution of the contract. The parties agreed that the balance of the price will be paid after one month while the said bag will delivered after one week. At the agreed date of delivery of the bag, B delivered a counterfeited coach bag. What is the best legal remedy available to A? a. File an action for damages for breach of contract of sale. b. File an action for annulment of voidable contract of sale. c. File an action for declaration of nullity of void contract of sale. d. He has no action because the contract of sale is unenforceable. 20) Which of the following statements concerning obligation is correct? a. Obligations arising from law are presumed. b. In an obligation to deliver an indeterminate thing, the obligor shall exercise diligence of a good father of a family in the preservation of the thing. c. In an obligation to deliver a determinate thing, the obligee is entitled to the fruits of the determinate thing from the time of constitution of the obligation. d. Obligations arising from contracts have the force of law between contracting parties. 21) As a general rule, which of the following is not a requisite of an action for damages on the basis of quasi-delict? a. There is pre-existing relation between the offender and offended parties. b. There exists a wrongful act or omission imputable to the defendant by reason of his fault or negligence. c. There exists a damage or injury which must be proved by the person claiming recovery. d. There must be a direct causal connection or a relation of cause and effect between the fault or negligence and the damage or injury, or that the fault or negligence be the cause of the damage or injury. 4|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 22) B borrowed P100,000 from L. In order to secure his obligation, B mortgaged his house under contract of chattel mortgage. B defaulted in the payment of the principal obligation. Which of the following statements is correct? a. The contract of chattel mortgage is not binding because the subject matter of the chattel mortgage must be personal property. b. The contract of loan is void. c. Unsecured creditor of B cannot ask for declaration of nullity of the contract of chattel mortgage because of the concept of relativity of contract. d. L may still foreclose the chattel mortgage constituted over the house. 23) B borrowed P500,000 from L. In order to secure the said obligation, T mortgaged his land. The contract of real estate mortgage provides that T is absolutely prohibited from selling the mortgaged land to third person. L registered the deed of real estate mortgage in the Registry of Deeds. Afterwards, T sold said mortgaged land to A. Which of the following statements is correct? a. L may foreclose the land already owned by A in case of default by B in the principal obligation. b. The contract of sale of land from T to A is void because it is prohibited by the terms of real estate mortgage. c. The contract of real estate mortgage will not bind and affect A because of the concept of relativity of contract. d. The contract of real estate mortgage is void because B is not the owner of the mortgaged land. 24) On January 1, 2001, S entered into a notarized contract to sell with A involving a specific laptop without payment of price. On January 2, 2001, S orally entered into a contract of sale with B involving again the same laptop. On January 3, 2001, S sold in written private instrument the same laptop to C who fully paid the price but without physical delivery. After discovery of the sale to C, B immediately obtained physical possession of the laptop from S. Who has better right over the laptop? a. A b. B c. C d. S 25) If there are reasonable grounds to fear the destruction or impairment of the thing pledged without the fault of the pledgee, what is the legal remedy available to the pledgor? a. To ask that the thing pledged be judicially or extra-judicially deposited. b. To ask that the thing be deposited with a third person. c. To demand the return of the thing pledged, upon offering another thing in pledge, provided the latter is of the same kind and quality. d. To demand the extinguishment of the contract of pledge. 26) Which of the following statements concerning the vendor’s liability for hidden defect is correct? a. The vendor is liable only if the reason of the loss of the thing with hidden defect is the hidden defect. b. The vendor is liable only if he was aware of the hidden defect. c. The vendor is not liable for the hidden defect if the loss is due to fortuitous event or fault of the vendee. d. The vendor is liable even he was not aware of the hidden defect. 5|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 27) Mr. A orally sold his specific land to Mr. B at a selling price of P499. The delivery and payment will be made after two months. On the agreed date of performance of contract, Mr A did not perform his obligation. What is the remedy available to Mr. B? a. File an action for specific performance b. He has no remedy. c. File an action to compel Mr. A to execute a written contract d. File an action for declaration of nullity 28) A has an outstanding debt of P1,000,000 to B. At maturity date, A tenders payment in the form manager’s check with the amount of P1,000,000 payable to the order of B. Which of the following statements is correct? a. If B will refuse the payment, A may consign the manager’s check to the court. b. A may compel B to accept the manager’s check because it is good as cash. c. The obligation is not yet extinguished. d. Upon acceptance by B of manager’s check, the obligation is extinguished. 29) A has an outstanding loans payable of P10,000,000 with a term of 15 years. The loan is secured by a real estate mortgage on the land of A. After 1 year, A and the bank agreed to reduce the principal amount of the loan to P5M and the term is shortened to 5 years. Which of the following statements is correct? a. No obligation remains to exist because of novation. b. The contract of real estate mortgage is extinguished. c. There is no novation because novation can never be presumed. d. The novation is void because there is no delivery of sum of money. 30) A is alternatively liable to deliver a specific cellphone, a specific laptop, or a specific tablet to B. The maturity date of the obligation is December 1, 2000. On October 1, 2000, A destroyed the tablet while on November 1, 2000, the rebels forcibly stolen the cellphone from A. On December 10, 2000, a lightning destroyed the laptop. Which is correct? a. A is not liable for damages. b. A is liable for damages by reason of his act of destroying the tablet. c. A is liable for damages by reason of delay. d. A is liable equivalent to the value of the tablet. 31) A is indebted in the amount of P5,000 to B. At the maturity date of the loan, A pays P5,000 to C. After such payment, B assigned the promissory note to C. Which is true? a. The payment is not valid because it is made to a third person. b. The payment is valid only if A can prove that such payment redounded to the benefit of B. c. The payment is valid even if without proving that such payment redounded to the benefit of B. d. The payment is valid only if such payment is with the consent of B. 32) A borrowed P10,000 from B with C pledging his cellphone and D serving as guarantor to secure the fulfillment of the obligation. Without knowledge of A, C pays the obligation of A to B at the maturity date. Which is true? a. C may ask for reimbursement from A only in so far as the payment is beneficial. b. C can directly go after D even without demanding payment from A. c. A may refuse to reimburse C on the ground that the payment is without his knowledge. d. C may go after D in case A becomes insolvent. 6|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 33) M issued a promissory note to P which states “I promise to pay P P10,000.” The promissory note was issued in exchange for a specific laptop. P subsequently indorsed and delivered the said promissory note to A. If M becomes insolvent at the maturity date of the note, which of the following is correct? a. A can validly collect from P provided a corresponding notice of dishonor is given to P. b. A cannot go after from P in the absence of express warranty of solvency of M. c. A cannot go after from P even if the insolvency of M is already existing and public knowledge at the time P assigned the note to A. d. A can validly collect from P because the latter violated his warranty. 34) M issued a promissory note to P which states “I promise to pay P P10,000.” The promissory note was issued in exchange for a bag of marijuana. P subsequently indorsed and delivered the said promissory note to A. Which of the following statements is correct? a. A can validly collect from M if A acquired the promissory note in good faith and for value. b. A can go after P only if M will dishonor the note and only if a corresponding notice of dishonor will be given to P. c. A cannot validly collect from M if A has knowledge of the infirmity in the instrument thus making A a holder not in due course. d. A can validly collect from P because the latter violated his warranty. 35) Which of the following is not a requisite in order for the vendor to be liable in case the animal sold dies of disease? a. The animal dies within 3 days from time of purchase. b. The disease is redhibitory. c. The disease exists at the time of sale. d. The disease is the cause of death of the animal. 36) In which of the following instances are the goods still in transit? a. If the goods are rejected by the buyer, and the carrier or other bailee continues in possession of them, even if the seller has refused to receive them back. b. If the buyer obtains delivery of the goods before arrival at the appointed destination. c. If the carrier or other bailee acknowledges to the buyer or his agent, that he is holding the goods in his behalf, after arrival of the goods at their appointed destination. d. If the carrier or other bailee wrongfully refuses to deliver the goods to buyer or his agent. 37) On January 1, 2001, A obliged to deliver a specific dog to B if the latter will pass the CPA board exam. The specific gave birth to a puppy on March 1, 2001. B passed the CPA board exam on October 1, 2001. Meanwhile, A sold and delivered the same dog to C on July 1, 2001. Which of the following statements is correct? a. B obtains real right over the specific dog on October 1, 2001. b. B obtains personal right over the puppy on January 1, 2001. c. C shall be entitled to the puppy. d. C has better right against B over the specific dog. 7|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 38) Which of the following obligations is not allowed to be legally compensated? a. Obligation arising from civil penalty in obligation with a penal clause b. Obligation arising from contract of savings deposit with a bank c. Obligation arising from contract of mutuum d. Obligation arising from contract of commodatum 39) A has P10,000 written obligation to B which becomes due and demandable on December 31, 2001. It is already 2012 but A has not yet fulfilled his obligation. On January 1, 2013, C paid the P10,000 obligation of A to B. Which of the following statements is correct? a. C can judicially compel A to reimburse but only in so far as the payment is beneficial. b. C can judicially recover the amount he has paid from B on the basis of the concept of unjust enrichment. c. If A voluntarily reimburses C, the former can no longer recover it from the latter. d. It is the civil obligation of A to reimburse C on the ground of equity and natural justice. 40) S sold a piece of land with an area of 80SQM to B at a price of P1,000 per square meter. After the delivery of the land, B measured the land and discovered that the actual area is only 73SQM. What is the remedy available to B? a. Action for proportionate reduction of price b. Action for cancellation of contract of sale c. Either a or b d. Neither a nor b 41) A, B and C are co-owners of a rural land with an area of 1,000SQM in the ratio of 1:4:5. The said rural land is adjoined by 200SQM rural land of D in the north and 300SQM rural land of E in the south. E’s use of the land appears to be best justified. C sold his share in the said rural land to F. Who has the preferred right to exercise the right of legal redemption? a. A at an area of 500SQM because his share in the co-owned land is smaller. b. D at an area of 500SQM because his adjoining rural land’s area is smaller. c. E at an area of 500SQM if his use of the said rural land appears to be best justified. d. A and B at proportionate area 100SQM and 400SQM respectively. 42) Which of the following stipulations in a contract of pledge is valid? I. Stipulation allowing the pledgee to appropriate the thing pledged in case it is not sold in first and second public auctions. II. Stipulation allowing the pledgee to be entitled to the excess in case the foreclosure sale results to excess. III. Stipulation providing that the return of the thing pledged to the pledgor will extinguish the contract of pledge. a. I only b. I and II only c. II only d. I, II and III 8|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 43) In unilateral obligation subject to a resolutory condition, who shall be entitled to the fruits of the determinate thing during the pendency of the resolutory condition? a. Creditor minus the expenses incurred for the preservation and gathering of the fruits b. Debtor minus the expenses incurred for the preservation and gathering of the fruits c. State d. Third person 44) M issued a promissory note payable to P in the amount of P10,000. P generally indorsed and delivered the note to A. A assigned and delivered the note to M. What mode of extinguishing obligation is present in this case? a. Compensation b. Novation c. Remission d. Merger 45) What is the prescriptive period of an action based on negotiorum gestio? a. 4 years b. 5 years c. 6 years d. 10 years 46) Which of the following obligations is immediately due and demandable? a. Obligation when debtor's means permit him to do so b. Obligation in diem c. Obligation ex die d. Obligation with a suspensive condition 47) A, a minor, B and C wrote a promissory note which states "I promise to pay D and E P60,000, solidary creditors." If B becomes insolvent at the maturity date of the note, how much may D validly collect from C? a. P20,000 b. P60,000 c. P30,000 d. P40,000 48) Which of the following instances will make an obligation with a suspensive period immediately due and demandable? a. When after the obligation has been contracted, the debtor becomes insolvent but he gives a guaranty or security for the debt. b. When through a fortuitous event the guaranties of securities after their establishment were impaired, unless the debtor immediately gives new one equally satisfactory. c. When the debtor attempts to abscond. d. Any of the above. 9|Page  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 49) Which of the following obligations may become the subject matter of legal compensation? a. Voidable obligation b. Unenforceable obligation c. Void obligation d. None of the above 50) D is alternatively liable to deliver a specific cellphone or a specific laptop or a specific tablet to C. Who has the right of choice? a. Always D b. Always C c. Generally C in the absence of stipulation to the contrary d. Generally D in the absence of stipulation to the contrary 51) D, a resident of Makati, has the obligation to deliver a car with plate number CPA-123 to C, a resident of Taguig. At the time of constitution of the obligation, such car is located in Pasay but at the time of supposed delivery, the car can be found in Caloocan. Where shall the car be delivered by D? a. Makati b. Taguig c. Pasay d. Caloocan 52) D has three matured obligations to C consisting of (1) accounts payable amounting to P100,000; (2) 10% notes payable amounting to P400,000 exclusive of P100,000 accrued interest; and (3) P500,000 mortgage payable secured by a real estate mortgage on D’s land. D paid P950,000 to C as payment for the obligations. How much shall be applied by C to the accounts payable? a. P100,000 b. P50,000 c. P95,000 d. None 53) Christian Ronaldo and SM Event Center entered into a contract wherein Christiano Ronaldo will conduct a personal and customized football clinic to SM’s shoppers. At the date of the scheduled event, Christiano Ronaldo failed to event. What legal remedy is available to SM Event Center? a. File an action for damages against Christian Ronaldo for breach of contract b. File an action for specific performance with damages against Christiano Ronaldo c. Ask a Filipino football player to conduct the football clinic at the expense of Christiano Ronaldo d. Any of the above 54) Which of the following contracts is consensual? a. Contract of guaranty wherein principal of the secured contract of loan is at least P500 b. Contract of donation of condominium unit with fair market value of less than P5,000 c. Contract of antichresis covering a land with fair market value of at least P500 d. Contract of chattel mortgage covering a car with fair market value of at least P500 10 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 55) W and H are legally married under property regime of conjugal partnership of gains. W orally sold his specific laptop to H at a price of P500 when its book value is still P800 after H pointed a gun to W. Delivery and payment will happen after two years. What is the status of contract of sale of the specific laptop between W and H? a. Unenforceable b. Void c. Voidable d. Rescissible 56) Which of the following innominate contracts means "Facio ut des"? a. I give that you may give. b. I give that you may do. c. I do that you may give. d. I do that you may do. 57) In case of doubt in the incidental circumstances of contract of lease, what is the rule to be applied in the interpretation of the ambiguity in this contract? a. It shall be resolved in favor of least transmission of rights. b. It shall be resolved in favor of greatest transmission of rights. c. It shall be resolved in favor of least reciprocity of interests. d. It shall be resolved in favor of greatest reciprocity of interests. 58) Which of the following contracts is not rescissible? a. Those which are entered into by guardians whenever the wards they represent suffer lesion by more than ¼ the value of the things which are the object thereof b. Those undertaken in fraud of creditors when the latter cannot in any other manner collect the claims due them c. Alienations by onerous title when made by persons against whom some judgment has been rendered in any instance or some writ of attachment has been issued d. Those agreed upon in representation of absentees, if the latter suffer by ¼ of the value of the things which are the object thereof 59) Which of the following contracts is subject to declaration of nullity? a. Those which are absolutely simulated b. Those entered into when one of the contracting parties is incapacitated c. Those oral executory contracts that are covered by Statute of Frauds d. Those undertaken in fraud of creditors 60) Which of the following is a proper ground for reformation of instrument? a. When a mutual mistake of the parties results to the failure of the instrument to disclose their real agreement b. When the consent of one of the parties in the contract is vitiated by fraud, undue influence, mistake, intimidation or violence c. If mistake, fraud, inequitable conduct, or accident has prevented a meeting of the minds of the parties d. When the consent of the contracting parties is absolutely simulated 11 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 61) What theory is being followed by the New Civil Code of the Philippines in determining the exact moment of perfection of contract when the acceptance is made through telegram? a. Reception theory b. Manifestation theory c. Cognitive theory d. Expedition theory 62) Which of the following may not become the object or subject matter of a contract? a. Patrimonial property of the Manila City b. Future inheritance c. Shares of stocks of Government Owned and Controlled Corporation d. Private property of the Republic of the Philippines 63) Which of the following obligations may not be secured by the accessory contract of pledge or chattel mortgage or real estate mortgage or antichresis? a. Natural obligation b. Unenforceable obligation c. Void obligation d. All of the above 64) Which of the following stipulations is valid in a contract of real estate mortgage? a. Stipulation prohibiting the mortgagor from selling or disposing the mortgaged property during the term of the secured loan b. Stipulation establishing tipo or upset price in the foreclosure sale of the mortgaged property c. Stipulation allowing the mortgagee to appropriate the property mortgaged in case of default by the debtor in the payment of the secured loan d. Stipulation awarding the excess in the foreclosure sale of the mortgaged property to the mortgagee 65) A and B jointly borrowed P10,000 from C. In order to secure the debt, A pledged his laptop worth P5,000 to C and B pledged his phone worth P5,000 to C. At the maturity date of the loan, A paid P5,000 to C. Which is correct? a. A may ask for the return of his laptop from C. b. B may ask for the return of his phone from C. c. The contract of loan is extinguished by the return of the laptop to C. d. C cannot be compelled by either A or B to return any of the pledged items. 66) Which of the following instances extinguishes the contract of pledge but not the secured contract of loan? a. Appropriation by the pledgee of the thing pledged at the first default by the debtor b. Oral renunciation by the pledgee of the contract of pledge c. Return by the pledgee of the thing pledged to the pledgor d. Sale of the thing pledged at public auction at net proceeds less than the amount of secured loan 12 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 67) BDO Unibank borrowed P10B from Vista Land Co. In order to secure the loan, BDO Unibank mortgaged its land to Vista Land Co. The borrower defaulted in the payment of the loan at the maturity date. This resulted to the extrajudicial foreclosure of the mortgaged land. What is the period available to the mortgagor for the exercise of right of redemption? a. Within one year from the foreclosure sale b. Within three months from the foreclosure sale c. Within 30 days from the foreclosure sale d. Within a period of not less than 90 days but not more than 120 days from foreclosure sale 68) A borrowed P100,000 from B. In order to secure this contract of loan, A mortgaged his car to B under a contract of chattel mortgage. The borrower defaulted in the payment of the loan at the maturity date. This resulted to the extrajudicial foreclosure of the mortgaged car. Which of the following statements concerning the net proceeds is correct? a. B can never recover the deficiency from the foreclosure despite any stipulation for recovery. b. B may recover the deficiency unless there is stipulation to the contrary. c. A will never be entitled to the excess despite any stipulation to that effect. d. B is entitled to the excess unless there is stipulation to the contrary. 69) Who shall be entitled to the fruits of the personal property covered by the contract of pledge? a. Pledgor b. Pledgee c. Pledgor and pledgee equally d. State 70) D borrowed P10,000 from C. In order to secure this contract of loan, D pledged a promissory note payable to D issued by M with maturity value of P13,000. At the date of maturity of the secured contract of loan and the pledged note receivable, C was able to collect P12,000 from M. Who shall be entitled to the excess P2,000? a. D b. D but only if there is stipulation to that effect c. C unless there is stipulation to the contrary d. C despite any stipulation to the contrary 71) In a contract of sale, what is the operative act that transfers ownership from the seller to the buyer? a. Full payment of the agreed price b. Meeting of minds between the buyer and seller c. Notarization of the deed of sale d. Actual or constructive delivery of subject matter 72) Which of the following instances is not an indicator that a contract purporting to be an absolute sale or pacto de retro sale shall be presumed to be an equitable mortgage? a. When the vendor remains in possession as lessee b. When the vendee binds himself to pay the real property taxes on the thing sold c. When the period for the exercise of the right of repurchase is extended d. When the purchaser retains for himself part of the purchase price 13 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 73) Which of the following remedies is not available to the buyer in a breach of warranty committed by the seller in a contract of sale? a. Accept or keep the goods and set up against the seller the breach of warranty by way of recoupment or diminution or extinction of the price b. Accept or keep the goods and maintain an action for annulment of contract of sale by reason of breach of warranty c. Refuse to accept the goods, and maintain an action against the seller for damages for breach of warranty d. Rescind the sale and refuse to receive the goods or if the goods have already received, return them or offer to return them to the seller and recover the price of any part thereof which has been paid 74) S and B entered into a contract of sale of goods to be delivered to B through a common carrier. B has sent post-dated check to S as payment for the price. S delivered the goods to the common carrier for transmission to B. Before the arrival at the destination of the goods and before S the encashment of the post-dated check, B becomes insolvent. What right is available to S? a. Right of possessory lien b. Right of resale c. Right of stoppage in transitu d. Right to rescission 75) S sold a residential land to B at an installment price of P6,000,000 payable for 50 years at equal monthly installment of P10,000. After payment of P1,200,000, B defaulted on the next monthly installment. After observing the proper formality provided by law, S was able to validly cancel the contract of sale. How much cash surrender value is B entitled to receive from S? a. P900,000 b. P960,000 c. P840,000 d. P600,000 76) Shopper A deposited his specific laptop to the baggage counter of SM Department Store. Such specific laptop was displayed by SM Department Store in the mall. Shopper B acquired the said laptop from SM Department Store at a price of P5,000. Which of the following statements is correct? a. Shopper B is entitled to the said laptop. b. Shopper A may recover the laptop from Shopper B without any obligation to reimburse Shopper B. c. Shopper A may recover the laptop from Shopper B but with obligation to reimburse Shopper B. d. Shopper B must pay P5,000 to Shopper A in order to perfect his ownership over the laptop. 77) In the same titled land is sold to two or more different buyers by the same seller, who among the buyers shall have better right? a. First actual possessor of the land in good faith b. First constructive possessor of the land in good faith c. First registrant of the deed of sale in good faith d. Buyer in good faith with the oldest title 14 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 78) A agreed to deliver a specific laptop worth P12,000 to B. On the other agreed, B agreed to deliver a specific cellphone worth P6,000 plus P6,000 cash to A. What contract is entered into by A and B? a. Contract for a piece of work b. Contract to sell c. Contract of sale d. Contract of barter 79) S normally or publicly manufactures or produces an item based on the special request or customized designed provided by its client. What contract is normally entered into by S? a. Contract for a piece of work b. Contract to sell c. Contract of sale d. Contract of barter 80) S sold a specific right to B at a price of P10,000. B paid P2,000 arras at the time of perfection of contract. At the maturity date of the payment of the price, how much must B pay to S? a. P10,000 b. P8,000 c. P2,000 d. P12,000 81) A sold all goods inside his specific warehouse to B. A delivered to B the key of such warehouse. What type of constructive delivery is made by A? a. Traditio brevi manu b. Tradition clavium c. Tradition longa manu d. Traditio constitutum possessorium 82) What is the ground for the exercise by the unpaid seller of his right of stoppage in transitu? a. The goods are of perishable nature. b. The buyer has been in default for an unreasonable length of time. c. The buyer becomes insolvent. d. The credit term has expired. 83) In what type of waiver by the buyer of warranty against eviction will the seller become fully exempted from liability in case of eviction? a. Waiver quanti minoris b. Waiver consciente c. Waiver redhibitoria d. Waiver intentionada 84) A, B and C wrote a promissory note which states “We promise to pay P30,000 to D”. A paid P30,000 to D. If B becomes insolvent, how much may A legally collect from C? a. P15,000 b. P10,000 c. P20,000 d. P30 15 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 85) In is an obligation where the debtor has to perform several prestations and it is extinguished only by the performance of all of them. a. Indivisible obligation b. Conjunctive obligation c. Alternative obligation d. Facultative obligation 86) S sold a car at an installment price of P100,000 payable in equal monthly installment of P10,000 per month to B. In order to secure the payment of the price, B mortgaged back the said car to S under chattel mortgage. The contract of chattel mortgage provides that S can recover the deficiency in case the foreclosure sale results to deficiency. Aside from that, the said contract provides that in case of cancellation, any installments received by S will be forfeited. After payment of seven monthly installments, B defaulted on the remaining three installments. Which of the following is correct? a. If a writ of attachment will be issued which will result in the sale in public auction of the car, S cannot recover the deficiency in public sale in the absence of stipulation for recovery. b. If the contract of sale will be cancelled, S will no longer have any recourse against B. c. If the chattel mortgage on the car will be foreclosed, S can recover the deficiency in public sale because there is agreement to that effect. d. After filing an action for exact fulfillment, S may still foreclose the chattel mortgage constituted on the car. 87) On January 1, 2001, S sold an immovable to B with a non-apparent and unregistered servitude. On July 1, 2002, B discovered such servitude after inspection of the immovable acquired. What remedy is available to B within one year after such discovery? a. Action for indemnification for damages b. Action for cancellation of the contract c. Either A or B d. Neither A nor B 88) L delivered P1,000,000 cash to B as consideration for the orally entered contract of loan. In order to secure the payment of the contract of loan, B and L orally entered into a contract of real estate mortgage over B’s land. Which of the following statements is correct? A. The contract of loan is unenforceable because it is not in writing. B. The contract of real estate mortgage is not binding because it is not in public instrument. C. The contracts of loan and real estate mortgage are binding. D. The contract of real estate mortgage is unenforceable because it is not registered in Registry of Property. 89. Where shall the deed of chattel mortgage involving a car be registered for validity? a. Chattel mortgage register of the province where the mortgagor resides and Land Transportation Office where the car is registered b. Chattel mortgage register of the province where the mortgagee resides and Land Transportation Office where the car is registered c. Chattel mortgage register of the provinces where the mortgagor resides and where the mortgagee resides d. Land Transportation Office where the car is registered 16 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 90. A and B issued a promissory note which states “We promise to pay P20,000 to C.” In order to secure the obligation, A pledged and delivered his specific laptop to C while B pledged and delivered his specific cellphone to C. At the maturity date of the obligation, B paid P10,000 to C. Which of the following statements is correct? a. A may validly ask for the return of his specific laptop from C. b. B may validly ask for the return of his specific cellphone from C. c. Both A and B may validly ask for the return of the specific laptop and specific cellphone. d. Neither A nor B may validly ask for the return of the specific laptop and specific cellphone. 91. When may the pledgee recover the deficiency arising from the public sale of the collateral? a. When the contract of pledge expressly provides for recovery of deficiency b. Deficiency arising from public sale can never be recovered in pledge c. In case of legal pledge d. Deficiency can be recovered despite absence of provision allowing recovery 92. In which corporate act may a dissenting stockholder exercise his appraisal right? a. Incurring or increasing bond indebtedness b. Sale, pledge, mortgage or disposal or all or substantially all the property of the corporation c. Increasing or decreasing of authorized capital stock d. Amendment of the by-laws of the corporation 93. In which corporate act may a dissenting stockholder exercise his appraisal right? a. Incurring or increasing bond indebtedness b. Sale, pledge, mortgage or disposal or all or substantially all the property of the corporation c. Increasing or decreasing of authorized capital stock d. Amendment of the by-laws of the corporation 94. Which of the following contracts must be both in writing and in public instrument in order to become enforceable and valid? a. Sale of house and lot regardless of price b. Lease of commercial lot for a period exceeding one year regardless of price c. Donation of land regardless of value d. Real estate mortgage covering condominium unit 95. Which of the following instances will not create a rebuttable presumption that the contract of pacto de retro sale is an equitable mortgage? a. When the vendee retains for himself part of the purchase price b. When the price of pacto de retro sale is inadequate c. When the vendor binds himself to pay the real property tax of the thing sold d. When the vendor retains possession of the thing sold 96. Where shall the deed of chattel mortgage involving a car be registered for validity? a. Chattel mortgage register of the province where the mortgagor resides and Land Transportation Office where the car is registered b. Chattel mortgage register of the province where the mortgagee resides and Land Transportation Office where the car is registered c. Chattel mortgage register of the provinces where the mortgagor resides and where the mortgagee resides d. Land Transportation Office where the car is registered 17 | P a g e  No. 125 Brgy. San Sebastian Lipa City, Batangas, Philippines Mobile : 0927 283 8234 Telephone : (043) 723 8412 Gmail : [email protected] 97. It refers to the type of waiver by the buyer of warranty against eviction whereby the seller is still liable in case of eviction. a. Waiver redhibitoria b. Waiver consciente c. Waiver intentionada d. Waiver quanti minoris 98. It refers to the action filed by an unpaid seller with a prayer asking for cancellation of contract entered by the debtor in fraud of creditor’s rights. a. Accion directa b. Accion publiciana c. Accion subrogatoria d. Accion pauliana 99. How is a private corporation created? a. By enactment of special law b. By mere consent c. By operation of law d. By registration to Registry of Deeds 100. In which of the following meetings may a proxy validly participate? a. Election of directors of corporation b. Election of officers of corporation c. Meeting of executive committee of a corporation d. Meeting of directors of corporation 18 | P a g e 19 | P a g e