ReSA - THE REVIEW SCHOOL OF ACCOUNTANCY

CPA Review Batch 42  October 2021 CPA Licensure Exam  RFBT Preweek

REGULATORY FRAMEWORK for BUSINESS TRANSACTIONS Atty. J. Domingo  Atty. N. Soriano

RFBT PREWEEK LECTURE

1. All of the following give rise to obligations without an agreement, except:
A. Law
B. Contract
C. Quasi-Contract
D. Quasi-Delict

2. Which of the following is not a conditional obligation?

A. D will pay C P10,000, 15 days after the former’s graduation
B. D will pay C P10,000, as soon as his financial means permit him to do so
C. D will pay C P10,000, after passing the 2021 October Licensure Exams for CPAs
D. D will pay C P10,000, 10 days after he marries W

3. Michael Scott is the employer of Dwight Schrute. The latter, driving recklessly, hit a pedestrian in the
course of the performance of his duties and caused serious injuries. Dwight Schrute was charged
criminally and was found guilty of reckless imprudence resulting to serious physical injuries and was made
to pay civil damages. In this case,
A. Michael Scott can be made vicariously liable for the civil damages
B. Michael Scott can raise the defense of diligence in the selection and supervision of employees if he
is made liable
C. Michael Scott cannot be made liable
D. Michael Scott can be made subsidiarily liable for civil damages and cannot raise the defense of
diligence in the selection and supervision of employees

4. Jake Peralta and Amy Rodrigues are co-workers. Amy filed for a loan in B99 Bank where Jake was a co-
signatory solidarily liable for the loan but did not receive any proceeds therefrom. Jake executed a real
estate mortgage over his own real property to secure said loan. Amy not being able to pay, B99 Bank
foreclosed the mortgage. In this case,
A. B99 cannot foreclose the mortgage since Jake, the mortgagor, did not receive any of the proceeds
of the loan.
B. In case the proceeds of the foreclosure is not sufficient to pay off the balance, Jake can be made
liable for the deficiency.
C. Only Amy can be made liable for the unpaid loan being the sole recipient of the proceeds.
D. Jake can no longer be made liable for any deficiency.

5. W, X, Y, Z are solidarily indebted to C for P40,000. When C demanded payment from W, the latter refused
claiming that X is a minor, Y’s share was already condoned and that Z is insolvent. How much is W
required to pay C?
A. P40,000 C. P20,000
B. P30,000 D. P10,000

6. The omission of that diligence required by the nature of the obligation and corresponds with the
circumstances of the persons, of the time and of the place.
A. Violatio C. Culpa
B. Dolo D. Mora

7. D is indebted to C for P100,000 secured by a mortgage executed by M on his lot and a guaranty by G.
Which of the following is false if M offers to pay the loan?
A. C can be compelled to accept the payment
B. M will be subrogated to the rights of C
C. M can later on collect from G if D fails to pay M
D. If it turns out that D already paid half of the loan, M can only collect P50,000

8. Jessica Day rented an apartment unit from Nick Miller. They agreed that Jess would pay for a one-month
deposit and one-month advance and would shoulder all utility costs during the length of her possession.
Jess, without notice, left the apartment unit and never returned, leaving an unpaid electric bill of P4,800.
From whom can the electric company collect?
A. Jess C. Both, equally
B. Nick D. Neither

9. Voluntary compensation is not proper in all of the following cases, except:

A. Deposit on the part of the depositary
B. Bail as to the bailor
C. Support as to the one obliged to give support
D. Civil liability arising from a penal offense

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10. Max owed Caroline P1 million due on October 1, 2021 but failed to pay her on due date. Caroline sent a
demand letter to Max giving her 5 days from receipt within which to pay. Two days after receipt of the
letter, Max personally offered to pay Caroline in manager's check, which was fully funded and debited
already from her account, but the latter refused to accept the same. After the lapse of the 5 days, is the
obligation considered extinguished?
A. Yes, since the refusal of Caroline has no basis resulting to the extinguishment of the obligation.
B. No, since tender of payment even in cash, if refused, will not discharge the obligation without proper
consignation in court.
C. Yes, since Max tendered payment of the full amount due.
D. No, since a manager’s check is not considered legal tender.

11. The following are void contracts, except:

A. Contract of sale between the guardian and his ward concerning the property of the latter.
B. Contract of lease between the executors and administrators and the estate concerning the property
of the estate under administration.
C. Contract of sale where the buyer is a government official entrusted with the administration of the
subject property
D. Contract of loan between the principal and an agent, where the latter was authorized to borrow
money.

12. The following are real contracts which require delivery for perfection, except:
A. Pledge C. Mutuum
B. Mortgage D. Deposit

13. Which of the following is a preparatory contract?

A. Lease C. Mortgage
B. Partnership D. Loan

14. Yuji Itadori, who is indebted to Satoru Gojo for P100,000, sold his only remaining property to Megumi
Fushiguro. There would be a presumption that the sale was in fraud of Gojo:
A. If Yuji did not reserve sufficient properties to pay all debts contracted before the sale.
B. If Yuji did not reserve sufficient properties to pay all debts contracted before and after the sale.
C. When there has been some judgment obtained by Gojo issued against Yuji before the sale.
D. When there has been some judgment issued against Yuji before the sale even if not obtained by Gojo.

15. Which of the following can validly give consent to a contract:

A. Insane persons
B. Demented persons
C. Minors
D. Deaf-mutes who are blind

16. The following contracts are unenforceable if not in writing, except

A. Sale of land as to authority of the agent to sell land
B. Sale of personal property at least P500
C. Lease of real property with a term of more than 1 year
D. Contract for a piece of work not to be performed within a year

17. An action for annulment of a sale of land on the ground of fraud would prescribe in 4 years from:
A. Date of sale
B. Discovery thereof
C. Registration of the sale
D. Delivery

18. Lucifer Morningstar rented out an condo unit to Chloe Decker for an 18 month period. The agreement was
not embodied in any written contract. As agreed upon by the parties, Chloe provided a check for 2 months
deposit and 18 post-dated checks to cover the 18 month term of the lease. What is the status of the
contract?
A. Valid and enforceable C. Void
B. Rescissible D. Unenforceable

19. Cameron Tucker obliged himself to deliver one of his five cars to Gloria Delgado-Pritchett but it was not
specified which car. In this case,
A. The contract would be interpreted following the least transmission of rights
B. The contract would be interpreted following the greatest reciprocity of interests
C. The contract is void
D. They would need to undergo reformation to clarify which car.

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20. Which of the following is false with regards the person who can institute annulment of a contract?
A. Only the incapacitated or injured party or his guardian can ask for annulment.
B. Creditors of the incapacitated party can ask for the annulment of the contract entered into by their
incapacitated debtor
C. Those who are capacitated cannot allege the incapacity of the other contracting party
D. Answer not given

21. Sheldon offered to sell his house and lot to Penny for P1,500,000. Penny was convinced and accepted the
same. Penny gave P500 and was given 30 days to make good the balance of the price. Before the
expiration of the 30 days, Sheldon withdrew and returned Penny’s P500 because he found a new buyer
who would pay twice. In this case,
A. Sheldon validly withdrew the offer since it is within the 30 day period.
B. Sheldon cannot validly withdraw the offer since there was an option money of P500 that was given.
C. Sheldon validly withdrew the offer since he is still the owner thereof pending delivery.
D. Sheldon cannot validly withdraw the offer since there was already a perfected contract of sale.

22. In this kind of contract of sale, upon happening of the condition, the buyer will have the right to compel
the seller to execute a deed of absolute sale:
A. Absolute sale
B. Conditional sale
C. Contract to sell
D. None of the choices

23. Mr. Sang-il Kim, who owns a local grocery store, sold to Arnold “Kimchee” Han 1,000 sacks of rice for
P1,000 per sack. On delivery date, however, Mr. Kim delivered 1,100 sacks. In this case, which of the
following is not an available remedy for Kimchee?
A. Accept the quantity agreed upon and reject the rest.
B. Accept the quantity delivered and pay at the contract rate.
C. Reject the whole if the contract is indivisible.
D. Reject the whole and ask for damages.

24. In this right of an unpaid seller, possessory lien or stoppage in transit is required:
A. Right of Resale
B. Rescission
C. Both A and B
D. Neither A nor B

25. Any affirmation of fact or any promise by the seller relating to the thing, if the natural tendency of such
affirmation or promise is to induce the buyer to purchase the same, and if the buyer purchased the
thing relying thereon.
A. Condition C. Advertisement
B. Express Warranty D. Marketing Disclosure

26. Monica Bing sold her land to Ross Geller with a right to repurchase the same within 10 years. Monica
died, leaving Phoebe and Ursula as heirs, prior to the expiration of the 10 year period. Which of the
following is incorrect?
A. Phoebe can demand the exercise of the right of redemption only as to half the land.
B. Ursula can demand the exercise of the right of redemption as to the whole land.
C. Ross can compel the heirs to redeem jointly and cannot be compelled to consent to a partial
redemption.
D. Ross can allow partial redemption of Ursula of half only

27. A buyer of real estate in installment was able to pay 6 years worth of installment prior to defaulting. The
following are the rights the buyer is entitled to under the Maceda Law, except:
A. Grace Period of 180 days
B. Cash Surrender Value of 55% of all payments made
C. Notice of Rescission at least 60 days before its effectivity
D. None of the choices is an exception

28. Amy Sosa sold to Dina Fox a truck for P2,000,000 secured by a chattel mortgage on the truck. For added
security, Dina’s friend Jonah Simms, executed a mortgage over his land in favor of Amy. Amy and Dina
agreed that the latter would pay 10% downpayment and the balance to be paid in monthly installments
of P100,000 for 19 months. Dina eventually defaulted twice and left a balance of the purchase price
amounting to P1,200,000. Amy then foreclosed the mortgage over the land and sold it in a public sale for
P1,500,000. In this case, who is entitled to the excess?
A. Amy
B. Dina
C. Jonah
D. All of them, equally

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29. In this accessory contract, the excess of the proceeds in the foreclosure sale over the unpaid obligation
would, as a rule, go to the creditor:
A. Pledge
B. Chattel Mortgage
C. Real Estate Mortgage
D. None of the choices

30. In a chattel mortgage, the disposal of the thing given as security during the pendency of the contract of
mortgage is:
A. Allowed if there is consent from the creditor-mortgagee but possession remains with the creditor-
mortgagee
B. Allowed always and any stipulation to the contrary would be void
C. A criminal act punished under the Revised Penal Code
D. Not allowed under any circumstance

31. The period to redeem the foreclosed real property if the creditor is a juridical person and the debtor is a
bank would be:
A. 1 year
B. 3 months
C. Until the certificate of sale is registered
D. 3 months or until registration of the certificate of sale, whichever is earlier

32. Which of the following is a negotiable instrument?

A. Pay P or his authorized representative P10,000 on October 15, 2021 sgd. D to DR
B. I promise to pay X or bearer P200,000 in two equal installments sgd. M
C. I promise to pay X or order P50,000 or deliver 50 sacks of rice upon the death of X sgd. D
D. Pay to bearer P20,000 sgd. M to D

33. Which of the following is a real defense that can be raised even against a holder in due course?
A. Complete but undelivered instrument
B. Breach of authority given
C. Fraud in factum
D. Post dating of a check

34. Which of the following statements render an instrument not payable in sum certain for money and
hence non-negotiable?
A. Option of the drawee to pay in kind
B. Cognovit actionem
C. Stipulation to pay interest
D. Indication of the value for which the instrument is issued

35. M made a promissory note payable to P and left the amount in blank. P was authorized to fill-up the note
for P10,000. However, P indicated P100,000 as the amount and negotiated the same to H. Which of the
following is correct?
A. If H is not a holder in due course, he can only collect P10,000
B. H can collect P100,000, regardless if he is a holder in due course or not
C. If H is a holder in due course, he can collect the entire P100,000
D. H cannot collect anything from M, regardless if a he is a holder in due course or not

36. In order to be liable for violating BP Blg 22, or the Anti-Bouncing Checks Law, the accused must be
A. The drawer
B. The issuer
C. Both A and B
D. Either of A or B

37. Whicih of the following pertains to the violation of BP Blg 22 and not estafa?
A. Good faith is a defense
B. Deceit is a necessary element
C. Notice requirement is 3 days from the time the check was dishonored
D. Presumption of knowledge of insufficiency of funds is 90 days from the check date

38. A, B and C are partner of ABC Partnership, Ltd., where B is the limited partner. After 10 years of
operations, the partnership now has debts to third persons amounting to P9,000,000 and their total
assets amounted to P6,000,000. Who among the partners shall be liable with their separate property in
favor of creditors?
A. A, B and C for P1M each
B. A and C for P1.5M each
C. A and B for P1.5M each
D. None can be made liable with their separate properties

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39. In a universal partnership of all present property, all of the following becomes common property, except:
A. Properties which belong to the partners at the time of the constitution of the partnership.
B. Any profits derive from properties belonging to each partner at the time of the constitution of the
partnership.
C. Any after-acquired property from a donation, legacy, inheritance including the profits thereof.
D. All of the above are included in the partnership

40. On September 30, 2021, Eleanor, Chidi and Janet agreed to form a partnership where Eleanor promised
to contribute money to be delivered on October 5, 2021. Eleanor failed to deliver the same and Chidi
made a demand therefor on October 15, 2021. Eleanor was only able to give the promised money on
October 31, 2021. Eleanor would:
A. Not be liable for damages since he is not yet in delay.
B. Be liable for interest and damages from October 5, 2021
C. Be liable for interest and damages from October 15, 2021
D. Be liable for interest only from the time demand was made.

41. First statement: a partner is deemed to be a co-owner of his co-partners of specific partnership property.
Second statement: A partner’s right in specific partnership property is assignable provided there is
consent from the other partners.
A. Both statements are correct
B. Both statements are incorrect
C. Only the first statement is correct
D. Only the second statement is correct

42. A capitalist partner:

A. Cannot engage in business for himself of whatever industry except if with consent of the partners.
B. Can engage in business of the same industry as that of the partnership even against the will of the
other partners.
C. Can engage in business for himself in an industry different from that of the partnership even without
the consent of the partners
D. Can engage in business of whatever industry even without the consent of the partners

43. A, B, C and D contributed P25,000 each to the partnership and agreed to distribute losses 1:1:2:2. For
the year, the partnership earned a profit of P12,000. How much would be the share of C?
A. P2,000 C. P4,000
B. P3,000 D. P6,000

44. V, W, X, Y and Z are partners with 5%, 10%, 15%, 30%, 40% interest, respectively. V, W and Y were
appointed as managing partners without specification as to their duties. V wanted to purchase raw
materials from a particular supplier to which Y opposed. Which of the following is correct?
A. Y’s opposition would prevail since he has more interest than that of V.
B. Y’s opposition would prevail even if W agrees with V, since their combined interest is smaller than
that of Y.
C. If W agrees with V, V’s decision would prevail.
D. X and Z would have to intervene and vote also, to determine whose decision will prevail.

45. C1, C2 and I are partners. They have agreed to exempt I, an industrial partner, from sharing on any and
all losses of the partnership.

At the end of the year, the partnership assets were P10,000 only while its liabilities are P100,000. In
this case?
A. The P100,000 liabilities can be directly charged by the creditors to the partners, including I.
B. The stipulation exempting I from liability is void entirely.
C. If I is made to pay, he can seek reimbursement of whatever he paid from C1 and C2.
D. The creditors can only go after C1 and C2, the capitalist partners at P45,000 each.

46. Elsa, Sam and Casey are partners of Atypical Partnership. Elsa, acting within the scope of her authority,
received P20,000 from Doug, a creditor of the partnership, and misapplied the same. From whom can
Doug collect the P20,000?
A. Elsa only
B. Elsa, Sam and Casey, solidarily
C. Elsa, Sam and Casey, jointly
D. Elsa, Sam, Casey and Atypical Partnership, solidarily

47. Which of the following is incorrect in relation to a partnership?

A. The partnership comes into existence by mutual agreement of the parties
B. The true test of a partnership is mutual agency, i.e., agency relationship among partners
C. A person who received the profits from a partnership is always a partner
D. None of the choices is incorrect

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48. As to whether it has authority to openly accept outsiders as stockholders or investors, a corporation can
be classified as:
A. De jure or de facto C. Open or close
B. Private or public D. Ecclesiastical or lay

49. Which of the following is not a responsibility of the Audit Committee of a publicly-listed company?
A. Compensation of the management
B. Monitoring management
C. Review corporate reporting procedures
D. Relations with the independent auditor

50. In corporations, minors are allowed to become:

A. Corporators C. Both
B. Incorporators D. Neither

51. A, B, C, D and E is organizing a corporation whose Authorized Capital Stock is P10,000,000. Each of them
subscribed to P500,000 or equivalent to 5%. In this case, applying the Revised Corporation Code,
A. Any of A, B, C, D or E can pay the 25% of the subscription
B. Each of A, B, C, D or E must pay at least P125,000 each
C. The requirement that 25% of the authorized capital stock has not been met.
D. There is no need to pay at least 25% of the subscription

52. If the corporation was able to commence business but became inoperative for __ years, it will result to
____:
A. 2 years; automatic dissolution.
B. 5 years; the corporation being placed under a delinquent status
C. 2 years; the corporation being placed under a delinquent status
D. 5 years; automatic dissolution.

53. Unbreakable KS Corporation, through Kimmy Schmidt, its general manager, entered into a contract of
sale with Titus Andromedon Corporation. Later on, Unbreakable KS Corporation unilaterally rescinded the
said contract. In this case, Kimmy Schmidt cannot be sued on her personal capacity under which principle?
A. Piercing the Veil of Corporate Entity
B. Doctrine of Limited Liability
C. Corporate Entity Doctrine
D. Presumption of Good Faith

54. The following statements pertaining to the express powers of a corporation, under the Revised Corporation
Code, are presented to you for evaluation:
I. A domestic corporation may make donations for the benefit of a political party or candidate or for
purposes of partisan political activity
II. A corporation may enter into a partnership, joint venture, merger or consolidation, or any other
commercial agreement with natural and juridical persons

A. Both statements are true

B. Both statements are false
C. Only statement I is correct
D. Only statement II is correct

55. Which of the following is NOT a requirement to become a director?

A. They must own at least 1% share.
B. Majority must be residents of the Philippines.
C. They do not possess any of the disqualifications under the Corporation Code.
D. None of the above.

56. As a rule, directors are not entitled to receive any compensation. Except in the following cases (choose
which is an incorrect exception):
A. Reasonable per diems
B. As provided in the by-laws
C. Upon a 2/3 vote of the stockholders
D. None of the choices is incorrect

57. A preferred shareholder is not entitled to vote in this corporate act:

A. Amendment of the articles of incorporation
B. Adoption and amendment of by-laws
C. Sale of all or substantially all of the corporate’s inventories
D. Incurring, creating or increasing bonded indebtedness

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58. Which of the following is regarded as voidable at the instance of the corporation?
A. Transactions of a self-dealing director
B. Transactions of an interlocking director
C. Transactions of a director in violation of confidentiality of information
D. Transactions of a director in violation of his duty of loyalty

59. Stockholders, as owners of the corporaiton, have the following rights expressly recognized by the
corporation law, except: the right,
A. To elect and remove directors
B. As co-owners of the corporate property
C. To inspect corporate books and records
D. To receive dividends when declared

60. Colt Bennett is a director of the Ranch Corporation whose term already expired. For lack of quorum, the
stockholders failed to elect a replacement director and Colt continued on a hold-over capacity before
resigning 3 months later. The vacancy will be filled-up by:
A. Stockholders
B. Board of Directors if they constitute a quorum
C. Board of Directors regardless if they constitute a quorum or not
D. Colt’s choosing

61. Which of the following corporate officers is required to be a member of the Board of Directors?
A. The President C. The Secretary
B. The Treasurer D. The Compliance Officer

62. A, B, C, D, E, F, G, H, I are members of the Board of Directors. In the meeting to appoint corporate
officers, only A, B, C, D and E are present. How many votes are required to elect corporate officers?
A. 2 C. 4
B. 3 D. 5

63. Which of the following is false with regards preferred shares?

A. A preferred share is a stock that gives the holder preference over the holder of common stocks with
respect to the payment of dividends and/or with respect to distribution of capital upon liquidation
B. A preferred share can be issued without a par value provided it is not issued for less than P5
C. The preference must be stated in the Articles of Incorporation and the Certificate of Stock.
D. None of the choices is false

64. Dunder Mifflin Corporation has P10M Authorized Capital Stock a part of which is 1M no par value shares
with issued value at P5.00. Jim Halpert acquired 100,000 no par value shares at P4.00. In this case,
A. There is no watering of stocks
B. Jim and the directors of Dunder Mifflin are solidarily liable for the P1.00 per share difference.
C. Only Jim is liable for the P1.00 per share difference.
D. Only the directors of Dunder Mifflin are liable for the P1.00 per share difference.

65. Removal of directors by the stockholders may be done even without cause provided:
A. It will not affect the pre-emptive rights of all stockholders
B. It will not deprive the minority stockholders of their right of representation
C. It will not affect the right of stockholders to file a derivative suit
D. It will not deprive the minority stockholders of their appraisal right

66. A non-stock corporation differs from a stock corporation in the following, except:
A. Cumulative voting is generally allowed
B. The number of directors may be more than 15
C. The Articles or the by-laws can provide that the officers are directly appointed by members
D. The meeting of members can be held anywhere in the Philippines

67. To qualify as a foreign corporation, the consideration is

A. Citizenship of the owners of the shares
B. Appointment of a resident agent
C. Agreement of the parties
D. Under what country’s law it was incorporated

68. Which meeting is required to be conducted at the principal office of the corporation?
A. Board of Directors of a stock corporation
B. Board of Directors of a non-stock corporation
C. Stockholders of a stock corporation
D. Members of a non-stock corporation

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69. Which of the following is considered a ground for temporary disqualification of a member of the Board of
Directors under the Revised Code of Corporate Governance?
A. Conviction by final judgment or order of a crime involving the purchase of securities as defined under
the Securities Regulations Code
B. For an independent director, becoming an officer, employee or consultant of the corporation
C. Conviction of a final judgment of a crime involving moral turpitude
D. Absence of more than 50% of all regular and special meetings of the Board of Directors

70. Which of the following committees are required to have at least 3 directors, one of whom shall be an
independent director, under the Revised Code of Corporate Governance?
A. Audit Committee
B. Nomination Committee
C. Compensation and Remuneration Committee
D. All of the choices

71. When the vacancy in the Board prevents the remaining directors from constituting a quorum and
emergency action is required to prevent grave, substantial, and irreparable loss or damage to the
corporation, the vacancy may be temporarily filled from among the officers of the corporation by how
many votes from the remaining directors/trustees?
A. At least 50%
B. Majority
C. 2/3
D. Unanimous

72. Which officer is required to be a resident and a Filipino Citizen?

A. CEO/President C. Corporate Secretary
B. CFO/Treasurer D. Compliance Officer

73. Missy Cooper delivered to Georgy Cooper, treasurer of the Corporation, P180,000 as a loan with 6%
interest. In return, Georgy issued a post-dated check in behalf of the corporation which was later on found
to be drawn against insufficient funds. In this case,
A. Georgy cannot be held personally liable since he merely signed the check in his capacity as Treasurer.
B. Gerogy can be held personally liable since he is made, by specific provision of law, for the corporate
action.
C. Georgy cannot be held personally liable since it is not shown that he had no personal knowledge of
the fact of insufficiency of funds.
D. Georgy can be held personally liable if the assets of the Corporation are insufficient to cover the
amount of the loan

74. Which of the following is not covered by the Mandatory Tender Offer Rule as to X Corporation stockholders:
A. A, who holds 30% of the shares of X Corporation, plans to acquire 25% more.
B. B, who holds 20% of the shares of X Corporation offered to buy from C, an existing shareholder, an
equivalent of 14% of X Corporation’s shares
C. X, Y and Z plans to acquire 45% of X Corporation over a period of 10 months
D. None of the choices

75. Piper Chapman is the lawyer of Orange Black Corporation, who in the course of her work acquired material
non-public information. In a drinking session, she informed her friend Alex Vause of the material non-
public information. Piper, in turn informed Joe Caputo, who she has a romantic affair with. All three of
them acquired shares of stock of Orange Black Corporation and in turn made profits when the price of the
shares shoot up when the information was made public. Which of the following is true?
A. Only Piper may be guilty of insider trading
B. Only Piper and Alex may be guilty of insider trading
C. Piper, Alex and Joe are all guilty of insider trading
D. None are guilty of insider trading

76. An order or orders for the purchase or sale of security with the knowledge that a simultaneous order or
orders of substantially the same size, time and price for the sale or purchase of such security has, or will
be entered by or for the same or different parties. This is otherwise known as:
A. Wash Sale C. Hype and Dump
B. Matched Order D. Squeezing the float

77. A group of individuals desired to organize as a cooperative with an Authorized Share Capital (ASC) of
P200,000. How much is the minimum subscription and the minimum paid-up capital required?
A. P50,000; P12,500
B. P50,000; P15,000
C. P100,000; P25,000
D. P100,000; P50,000

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ReSA Batch 42 - October 2021 CPA Licensure Examination

78. A tertiary cooperative which will organize as a Federation is required to have at least __ secondary
cooperative members and a minimum paid-up capital of:
A. 10; P500,000
B. 15; P5,000,000 or the feasibility study requirement, whichever is higher.
C. 10; P5,000,000 or the feasibility study requirement, whichever is higher.
D. 15; P500,000

79. A cooperative that engages in the supply of production inputs to members and markets their products:
A. Credit Cooperative C. Marketing Cooperative
B. Consumers Cooperative D. Producers Cooperative

80. The quorum requirement of a General Assembly meeting of a cooperative is generally:

A. 25% C. 2/3
B. Majority D. 3/4

81. The following are disqualified from being officers of a cooperative, except:
A. The members of the board of directors.
B. Committee members
C. A person who has a relative within the third civil degree of consanguinity or affinity who is an officer
of the cooperative.
D. Any person engaged in a business similar to that of the cooperative or who in any other manner has
interests in conflict with the cooperative

82. A cooperative is exempt from income tax in all of the following cases, except:
A. It transacts only with members
B. It transacts also with non-members and its accumulated reserves and undivided net savings is not
more than P10M
C. It transacts also with non-members and its accumulated reserves and undivided net savings is more
than P10M
D. None of the above
83. In a cooperative, a member cannot own more than __% of the share capital
A. 5% C. 20%
B. 10% D. 50%

84. An auditor, in his individual capacity or as a partner of the firm, cannot undertake the external audit of
the same cooperative for more than ____ consecutive years
A. Two C. Four
B. Three D. Five

85. A portion of the net surplus of the cooperative shall be set aside in a fund used to acquire land and building
and other necessary spending. This fund is known as:
A. Reserve Fund
B. Education and Training Fund
C. Community Development Fund
D. Optional Fund

86. The Community Development Fund shall be ___ of the Net Surplus:
A. At least 10% C. At least 5%
B. At least 7% D. At least 3%

87. Otis Milburn maintains joint deposit accounts - with Jean Milburn with a balance of P500,000; with Eric
Effiong with a balance of P300,000; and with Moordale Education Corporation for P1,000,000, all in the
same bank. How much is Otis’s insured deposit amount?
A. P400,000 C. P900,000
B. P500,000 D P1,000,000

88. Assuming the PDIC made an actual takeover of the Bank on Jan. 1, 2021 and Juan dela Cruz filed his
claim for insurance on Jan. 5, 2023. Juan dela Cruz’ claim shall
A. Be forfeited in favor of the bank.
B. Be forfeited in favor of the Government.
C. Become a claim against the asset of the closed bank.
D. Be against the PDIC but only as to the insured amount

89. Which of the following acts of the Bank is in violation of the Bank Secrecy Law?
A. Disclosure to the AMLC of deposits more than P500,000 in one banking day
B. Disclosure of the details of the bank deposit to the court, upon the latter’s order, in a case against a
public officer concerning plunder
C. Disclosing details of bank deposits in accordance with a BSP audit
D. Disclosing details of a bank deposits to the Commissioner of Internal Revenue to determine income
tax liability

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY RFBT Preweek
ReSA Batch 42 - October 2021 CPA Licensure Examination

90. Unclaimed deposits shall be forfeited in favor of the

A. Local Government having jurisdiction over the residence of the depositor
B. Local Government having jurisdiction over the branch where the deposit was made
C. National Government
D. Local Government and National Government equally

91. In case of a transaction is both reportable as “covered” and at the same time “suspicious”, it shall be
reported to the AMLC as
A. A covered transaction C. Both a covered and suspicious transaction
B. A suspicious transaction D. A complaint for money laundering

92. A court order is not necessary for the AMLC to inquire into bank deposits when the offense involved any
of the following, except:
A. Hijacking C. Homicide
B. Conspiracy to Commit Terrorism D. Destructive Arson

93. Which of the following “covered persons” under the AMLA, is supervised or regulated by the Insurance
Commission?
A. Investment houses C. Trust entities
B. Pawnshops D. Holding companies

94. Which of the following is incorrect as to “covered transactions” under the AMLA, as amended:
A. A transaction in cash or other equivalent monetary instrument involving a total amount in excess of
P500,000 within one banking day.
B. For casinos, a single casino cash transaction in excess of P5,000,000 or its equivalent in any other
currency.
C. For real estate developers/brokers, a single cash transaction involving an amount in excess of
P7,000,000 or its equivalent in any other currency.
D. None of the above is incorrect.

95. That stage in money laundering which involves sending money through various financial transactions to
change its form and make it more difficult to follow
A. Placement C. Integration
B. Layering D. Preliminary

96. Jake Peralta works in B99 Corporation as an accountant. He later on invented a patentable invention
during his employment. In this case,
A. B99 Corporation owns the patent.
B. Jake owns the patent even if the inventive activity is part of his regularly-assigned duties.
C. B99 Corporation owns the patent if the inventive activity is not part of his regularly-assigned duties
but he used the time, facilities and materials of the company.
D. Jake owns the patent if the inventive activity is not part of his regularly-assigned duties and whether
or not he used the time, facilities and materials of the company

97. The term of protection for a copyright is:

A. 10 years from issuance date and can be renewed indefinitely
B. Lifetime of the author plus 50 years from death
C. 20 years from the date of filing of the application
D. None of the above

98. Which of the following will be considered privileged information?

A. Health records of the Data Subject
B. Disclosure of the Data Subject made in a tax return
C. Statements made by a Data Subject to his priest
D. A Data Subject’s Social Security Number

99. First statement: For evidentiary purposes, an electronic document shall be the functional equivalent of
a written document under existing laws.
Second statement: The Data Privacy Act modifies existing statutory rules relating to admissibility of
electronic data massages or electronic documents, including the rules relating to authentication and best
evidence.
A. Both statements are correct
B. Both statements are incorrect
C. Only the first statement is correct
D. Only the second statement is correct

100. Under the Ease of Doing Business Act, the number of signatories in any document shall be limited to:
A. 1 C. 5
B. 3 D. 7

- Nothing Follows -

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