11.Based on the facts in Number 08, having found out that the corporation may have been irregularly created, the Securities and Exchange Commission instituted the appropriate proceedings in court to revoke the certificate of incorporation of the corporation and question the validity of its existence, will the case be given attention by the Honorable Court?*

1 point

A. Yes, because the Securities and Exchange Commission is the specialized agency of the government that is tasked with supervising private corporation.

B.Yes, because the Securities and Exchange Commission has noted a valid ground to question the validity of the existence of the corporation.

C.No, because Securities and Exchange only issues the certificate of incorporation and could not question the validity of the existence of a corporation.

D.No, because, a de facto corporation can be transformed into a de jure corporation.

12. Pooh, Tigger, Roo, Balo and Hope formed a corporation. Tigger, in good faith, entered into a contract with Winnie Corporation armed with an authority from the corporation. The authority was limited to mortgaging a property registered in the name of the corporation to secure a loan of Php 50,000.00. Given the convincing power of Tigger, he was able to broker Php 100,000.00 loan. Will the contract bind the corporation in the absence of ratification on the directors or trustees?*

1 point

A. Yes, because Tigger was authorized to enter into the contract for the corporation.

B.Yes, because the proceeds from the contract will benefit the corporation.

C.No, because Tigger exceeded his authority.

D.No, because the contract will be beyond the authority of the corporation to enter into.

13. The following are true of redeemable shares, except:*

1 point

A.They are purchased back by the corporation after the expiration of a fixed period.

B. They are purchased back when the corporation has unrestricted retained earnings.

C.They have to be stated as such in the Articles of Incorporation of the corporation.

D. When they are purchased back, the corporation should not be forced to dissolved.

14. These are stocks that are issued for a consideration less than the par or issued price or in any other form other than cash valued on excess of its face value.*

1 point

A.preferred share

B.watered share

C.optional share

D.convertible share

15.It asserts that subcriptions to the capital stock of a corporation constitutes a fund to which the creditors have a right to look for the satisfaction of their claims.*

1 point

A. trust fund doctrine

B.doctrine of individisibility

C.doctrine of corporate opportunity

D.none of the above

16. I. The contents of the articles of incorporation are binding not only on the corporation but also on its stockholders. II. The general rule as to corporations is that each corporation must have a name under which it is to sue and be used and do all legal acts.*

1 point

A. Only I is true.

B.Only II is true.

C.Both are true.

D.Both are false.

17. The following are the reasons why the principal office of a corporation must be stated in its articles of incorporation, except:*

1 point

A. To fix the residence of the corporation in a definite place

B.To determine the place where cases involving the corporation could be filed

C.To determine the venue of the meeting of directors or trustees

D.To determine the place where the books and records of the corporation should be kept

18. The following are requisites to facilitate amendment of the articles of incorporation, except:*

1 point

A.The amendment must be for a legitimate purpose

B. The amendment must be approved by a majority of the directors or trustees.

C.The amendment requires the vote or written assent of stockholders representing majority of the OCS or members.

D. The original and amended articles together shall contain all the provisions required by law to be set out in the articles of incorporation.

19. The following are attributes of a de facto corporation except:*

1 point

A.The existence of a valid law under which it may be incorporated

B. An attempt in good faith to incorporate

C.Assumption of corporate powers

D. None of the above

20. I. The filing of the articles of incorporation and the issuance of the certificate of incorporation are essential for the existence of a de facto corporation. II. An organization not registered with the SEC cannot be considered a corporation in any concept not even as a corporation de facto.*

1 point

A. Only I is true.

B.Only II is true.

C.Both are true.

D.Both are false.