ReSA - THE REVIEW SCHOOL OF ACCOUNTANCY

CPA Review Batch 44  October 2022 CPALE  Pre-Week Summary Lecture

REGULATORY FRAMEWORK for BUSINESS TRANSACTIONS J. DOMINGO  N. SORIANO

RFBT PREWEEK LECTURE

1. First Statement: Upon termination of employment, OFWs shall continue to pay
contributions to the SSS on a mandatory coverage.
Second Statement: Coverage of self-employed individuals shall start upon his
registration with the SSS.
A. Both statements are correct
B. Both statements are incorrect
C. Only the first statement is correct
D. Only the second statement is correct
2. If a retired employee had 50 years of credited service with a monthly average
salary credit of P20,000, how much is his monthly retirement pay?
A. P20,300
B. P21,300
C. P24,300
D. P25,300
3. The maternity leave benefit under the SSS Law, in general, shall be a period
of _____ days with pay.
A. 60
B. 90
C. 105
D. 120
4. To be entitled to the monthly pension, a member with a permanent total
disability must have contributed at least ____ months’ worth of
contributions:
A. 18
B. 36
C. 60
D. 120
5. A self-employed member of the SSS is required to submit the required report
within ___ days from the effective date of coverage:
A. 15
B. 30
C. 45
D. 60

6. Eid’l Adha and National Heroes Day fell on the same day that Mr. X reported
for work. If Mr. X worked for 12 hours from 8am to 8pm with only a short
break from 2:00PM to 2:20PM, how much would he be entitled to on that day if
he earns P1,000 per regular work day?
A. P4,950
B. P3,000
C. P39,600
D. Answer not given

7. Solo Parent leave can be gratned to solo parent employees who has rendered
at least 1 year of service, upto a maximum of how many days?
A. 105
B. 60
C. 10
D. 7

8. The 13th month pay is required to be paid not later than:

A. November 15
B. November 30
C. December 24
D. December 31

9. Overtime rendered on a special holiday that is also a rest day shall entitle
the employee to this premium rate:
A. 130%
B. 150%
C. 195%
D. 260%

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
10. The Labor Standards do not apply to the following employees, except:
A. Government employees
B. Managerial employees
C. Domestic helpers
D. None of the choices is an exception

11. An act or practice where the seller, distributor, producer or manufacturer

takes advantage of the consumer's physical or mental infirmity, ignorance,
illiteracy, lack of time or the general conditions of the environment or
surroundings, induces the consumer to enter into a sales or lease transaction
grossly inimical to the interests of the consumer or grossly one-sided in
favor of the producer, manufacturer, distributor, supplier or seller.
A. Deceptive Sales Act or Practice
B. Unconscionable Sales Act or Practice
C. Mislabelling
D. Prohibited Distribution Scheme

12. If a consumer product is corrosive, which word must be indicated in the

label?
A. Danger
B. Warning
C. Poison
D. Caution

13. Motor vehicles as used in the Philippine Lemon Law includes:

A. Motorcycles
B. Delivery trucks
C. Buses
D. None of the choices

14. Referral Sales may be allowed if:

A. There is prior permit from the DTI
B. The benefit to the consumer is stated in writing
C. It’s always not allowed
D. Conducted between 9:00AM to 7:00PM on a weekday

15. This is absolutely not allowed with regards sale of consumer products:
A. Chain Distribution Plans
B. Home Solicitation Sales
C. Referral Sales
D. All of the choices

16. C is a secured creditor of D, the latter now under rehabilitation. D is

indebted to C for P1M, but secured the same through a Real Estate Mortgage
of a property with a value of P1.5M. In this case, which of the following
would be incorrect?
A. C may waive his right under the security and share in the distribution of
the assets of the D
B. C may maintain his security and if the property is sold for P1.8M in the
foreclosure, the excess will belong to D
C. The rehabilitation receiver may convey the property to C and if the agreed
value is P1.4M, C will be required to return the excess P400,000
D. The rehabilitation receiver may convey the property to C and if the agreed
value is P900,000, C will waive the collection of the P100,000 balance.

17. The filing of a petition for rehabilitation of a corporation will require

the majority of the directors and stockholders representing ________ of the
outstanding capital:
A. 50%
B. Majority
C. 2/3
D. 3/4
18. The approval of a pre-negotiated rehabilitation plan must be ___ of the
total liabilities to secured creditors, among others
A. 67%
B. 75%
C. 85%
D. 100%

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
19. Which of the following is a correct description of the proceedings under
the FRIA
A. Quasi In rem
B. Summary
C. Adversarial
D. None of the choices

20. Which of the following proceedings may not be initiated by the creditors?
A. Rehabilitation
B. Liquidation
C. Suspension of payments
D. None of the choices

21. The following are the governing principles applicable to the procurement
of the government, except:
A. Transparency in the procurement process and in the implementation of
procurement contracts.
B. Competitiveness by extending equal opportunity to enable private
contracting parties who are eligible and qualified to participate in
public bidding
C. Streamlined procurement process that will uniformly apply to all
government procurement. The procurement process shall simple and made
adaptable to advances in modern technology in order to ensure an effective
and efficient method.
D. None of the choices is an exception

22. As a general rule, prior to the issuance of the Invitation to Bid, the BAC
is mandated to hold a pre-procurement conference:
A. On at least one of every three procurements
B. On a procurement with an ABC of at least P1,000,000
C. On each and every procurement
D. As the Procuring Entity may request

23. At least how many pre-bid conference shall be conducted for each procurement?
A. One
B. Three
C. Five
D. Seven

24. This is given as a guarantee that the winning bidder shall enter into
contract with the Procuring Entity within the stipulated time.
A. Bid Security
B. Performance Security
C. Contract Security
D. Commitment Undertaking

25. First Statement: In case the Head of the Procuring Entity or his duly
authorized representative approves the recommendation, he/she shall
immediately issue the Notice of Award.
Second Statement: Within ten calendar days from receipt of the Notice of
Award, the Winning bidder shall formally enter into contract with the
Procuring Entity.
A. Both statements are correct
B. Both statements are incorrect
C. Only the first statement is correct
D. Only the second statement is correct

26. The requirement that the parties to an insurance contract must transact with
each other with honesty and candor relates to which characteristic of a
contract of insurance?
A. Contract of Adhesion
B. Aleatory Contract
C. Contract of Utmost Good Faith
D. Personal Contract

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
27. The maximum sum guaranteed in a Microinsrance is not more than _____ times
the current daily minmum wage rate for nonagricultural workers in Metro
Manila.
A. 100
B. 500
C. 1,000
D. 5,000

28. The following have insurable interest in life and health, except:
A. The father as to the life of his son
B. The wife as to the life of her husband
C. The debtor as to the life of the creditor
D. The nephew as to the life of his aunt to whom he is dependent for support

29. D is indebted to C for P100,000 due on December 31. D secured an insurance

over his life for the benefit of C. On November 30, D died at the time the
balance of the obligation was only P20,000. How much of the insurance would
inure to the benefit of the estate of D?
A. P100,000
B. P80,000
C. P20,000
D. P0

30. The beneficiary is required to have insurable interest in which of the

following instances?
I. In property insurance
II. In life insurance taken by the insured
III. In life insurance taken by a third person on the life of the insured

A. I, II and III
B. I and II only
C. I and III only
D. II and III only

31. Output Limitation and Market Allocation, under the Philippine Competition
Act, are
A. Per se prohibited
B. Prohibited if the object or effect of restricting competition
C. Allowed even between competitors
D. None of the choices is correct

32. An agreement between competitors which provides for a maximum cap on the
price of their competing goods may be referred to as:
A. Price fixing
B. Bid rigging
C. Output limitation
D. Market allocation

33. Requiring buyers/consumers to purchase a tied-up product that is unrelated

to what they actually intend to purchase may be considered a/an:
A. Anti-Competitive Agreement
B. Abuse of Dominant Position
C. Mislabelling
D. Prohibited Acquisition

34. All of the following may be covered by the power/authority of the Philippine
Competition Commission to review agreements, except:
A. Mergers
B. Consolidations
C. Acquisitions
D. None of the choices is an exception

35. In general, the period of review of mergers and acquisitions by the

Philippine Competition Commission shall be a period of:
A. 30 days
B. 60 days
C. 90 days
D. 120 days

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
36. Which of the following is not allowed to examine bank accounts?
A. The Monetary Board
B. Anti-Money Laundering Council
C. Independent Auditor
D. None of the choices

37. Mr. X maintains P900,000 in his bank account in a bank that is to be taken
over by the PDIC for liquidation purposes. Prior to the closure, Mr. X
transferred P400,000 to the name of his son, in order to maximize the deposit
insurance. How much would Mr. X be entitled to for deposit insurance
coverage?
A. P400,000
B. P500,000
C. P900,000
D. P0

38. First Statement: Issuance of a writ of garnishment will be a violation of

the secrecy of bank deposits
Second Statement: Foreign deposits are considered exempt from garnishment
A. Both statements are correct
B. Both statements are incorrect
C. Only the first statement is correct
D. Only the second statement is correct

39. The following accounts are with X Bank:

Genie in trust for Miko P400,000
Genie by Alexies P300,000
Genie for the account of Cherry P300,000
Genie and Nikki P800,000
How much is genie’s insured deposits?
A. P300,000
B. P500,000
C. P550,000
D. P750,000

40. Failure to comply with the Truth in Lending Act will result in which of the
following?
A. The loan is deemed paid already
B. The purchase will be considered fully paid
C. The contract of loan will be unenforceable
D. None of the choices

41. This is required to be indicated in pesos and centavos as a required

disclosure under the Truth in Lending Act:
A. The amount financed
B. The finance charge
C. The effective interest rate
D. All of the choices

42. The most dangerous stage of money laundering

A. Placement
B. Layering
C. Integration
D. None of the choices

43. The following are predicate crimes or unlawful activities under the AMLA,
except:
A. Estafa
B. Violation of the Anti-Fencing Law
C. Robbery
D. Theft

44. Those entities dealing with currencies, commodities or financial derivatives

are under the supervision and/or regulation of:
A. The BSP
B. The SEC
C. The Insurance Commission
D. The PDIC

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
45. Which of the following “covered persons” under the AMLA, is supervised or
regulated by the Insurance Commission?
A. Investment houses
B. Pawnshops
C. Trust entities
D. Holding companies

46. 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.

47. 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

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

49. 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

50. 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 be made vicariously liable for the civil damages but
can raise the defense of diligence in the selection and supervision of
employees if he is made liable
C. Michael Scott can be made subsidiarily liable for civil damages and
cannot raise the defense of diligence in the selection and supervision
of employees
D. Michael Scott cannot be made liable

51. 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.

52. 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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
53. 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
54. 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
55. 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
56. 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
57. Max owed Caroline P1 million due on May 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.
58. 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.
59. The following are real contracts which require delivery for perfection,
except:
A. Pledge C. Mutuum
B. Mortgage D. Deposit
60. Which of the following is a preparatory contract?
A. Lease C. Mortgage
B. Partnership D. Loan
61. 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.

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
62. Which of the following can validly give consent to a contract:
A. Insane persons
B. Demented persons
C. Minors
D. Deaf-mutes

63. 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

64. 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

65. 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

66. 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.

67. 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

68. 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.

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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
70. The following are the available remedies of a buyer of movables where the
delivered quantity is more than that which is agreed upon, except:
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.

71. 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

72. 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

73. 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

74. 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

75. 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. 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

76. 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

77. 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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
78. 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
79. 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
80. Which 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
81. A, B and C are partner of ABC Partnership, Ltd., with equal contributions.
However, B is a 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
82. 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
83. On September 30, 2022, Eleanor, Chidi and Janet agreed to form a partnership
where Eleanor promised to contribute money to be delivered on October 5,
2022. Eleanor failed to deliver the same and Chidi made a demand therefor
on October 15, 2022. Eleanor was only able to give the promised money on
October 31, 2022. 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, 2022
C. Be liable for interest and damages from October 15, 2022
D. Be liable for interest only from the time demand was made.
84. 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
85. 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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
86. 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

87. Multiple managing partners were appointed in the partnership with no

specification of duties and no stipulation requiring the consent of all.
Which of the following would be an incorrect statement relative to such set-
up of management?
A. Any one of the managing partners may exercise authority to perform acts
of administration
B. Any one of the managing partners may oppose the decisions of the others
C. In case of opposition between managing partners, such will be resolved by
a vote of the controlling interest of the managing partners
D. In case of a tie in the votes of the managing partners, the controlling
interest of all the partners will be considered.

88. C1, C2 and IP are partners. They have agreed to exempt IP, 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 IP.
B. The stipulation exempting IP from liability is void entirely.
C. If IP 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.

89. Elsa, Sam and Casey are partners of Penguin 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 Penguin Partnership, solidarily

90. 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
91. 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
92. 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
93. In corporations, minors are allowed to become:
A. Corporators C. Both
B. Incorporators D. Neither
94. 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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
95. 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.

96. 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

97. 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

98. Which of the following is a requirement to become a director?

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

99. 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

100. 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

101. 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

102. 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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
103. 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

104. 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

105. 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

106. 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

107. 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.

108. 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

109. Which of the following incorrectly pertains to a non-stock corporation?

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. None of the choices

110. To determine whether a corporation is domestic or foreign, we apply the

A. Control Test
B. Grandfather Rule
C. Incorporation Test
D. All of the choices

111. 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 Trustees of a non-stock corporation
C. Stockholders of a stock corporation
D. None of the choices

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
112. 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

113. 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

114. 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. 100%

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

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

116. 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. Georgy 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

117. 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

118. 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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
119. 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

120. 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

121. 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

122. 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

123. The quorum requirement of a General Assembly meeting of a cooperative is

generally:
A. 25% C. 2/3
B. Majority D. 3/4
124. 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
125. 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
126. In a cooperative, a member cannot own more than __% of the share capital
A. 5%
B. 10%
C. 20%
D. 50%
127. 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
128. 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

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY
Batch 44 – October 2022 CPA Licensure Examination
RFBT Preweek
129. 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%

130. 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

131. 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

132. 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

133. 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

134. 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

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

- END -

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