Divine Word College of
Calapan
DEPARTMENTAL EXAMINATION
ACCOUNTANCY DEPARTMENT
NAME: ________________________________________________ SCORE: ________/RATING: _________
ID NUMBER: ___________________________________________
COURSE:
________________________
PRAYER BEFORE EXAM
O God, help me at my examination today to remember the things which I have
learned and studied. Help me to remember well and to think clearly. Help me not to
be so nervous and excited that I will not do myself justice, and keep me calm and
clear-headed. Help me to try my hardest and to do my best. This I ask for your love’s
sake, AMEN.
MULTIPLE CHOICE: Answer the following questions correctly. Summarize the letter of your final
answer on the answer sheet provided. Use CAPITAL LETTERS only. AVOID ERASURES.
1. X constituted a chattel mortgage on a car (valued at Php1 Million pesos) to secure a
P500,000.00 loan. For the mortgage to be valid, X should have
a.
The right to mortgage the car to the extent of half its value.
b. Ownership of the car.
c.
Delivered the car to the creditor.
d. Registered the car in his name.
2. X, at Y’s request, executed a Real Estate Mortgage (REM) on his (X’s) land to secure Y's loan
from Z. Z successfully foreclosed the REM when Y defaulted on the loan but half of Y's
obligation remained unpaiD. May Z sue X to enforce his right to the deficiency?
A
Yes, but solidarily with Y.
b. Yes, since X’s is deemed to warrant that his land would cover the whole
obligation.
c.
No, since it is the buyer at the auction sale who should answer for the
deficiency.
d. No, because X is not Z’s debtor.
3. Can future inheritance be the subject of a contract of sale?
a. No, since it will put the predecessor at the risk of harm from a tempted buyer, contrary
to public policy.
b. Yes, since the death of the decedent is certain to occur.
c. No, since the seller owns no inheritance while his predecessor lives.
d. Yes, but on the condition that the amount of the inheritance can only be ascertained
after the obligations of the estate have been paid.
4. A buyer ordered 5,000 apples from the seller at P20 per apple. The seller delivered 6,000
apples. What are the rights and obligations of the buyer?
a. He can accept all 6,000 apples and pay the seller at P20 per apple.
b. He can accept all 6,000 apples and pay a lesser price for the 1,000 excessapples.
c. He can keep the 6,000 apples without paying for the 1,000 excess since the seller
delivered them anyway.
d. He can cancel the whole transaction since the seller violated the terms of their
agreement.
5. Lino entered into a contract to sell with Ramon, undertaking to convey to the latter one of the
five lots he owns, without specifying which lot it was, for the price of P1 million. Later, the
parties could not agree which of five lots he owned Lino undertook to sell to Ramon. What is
the standing of the contract?
a.
Unenforceable.
c.
Rescissible.
b. Voidable.
d. Void.
6. Knowing that the car had a hidden crack in the engine, X sold it to Y without informing the
latter about it. In any event, the deed of sale expressly stipulated that X was not liable for
hidden defects. Does Y have the right to demand from X a reimbursement of what he spent to
repair the engine plus damages?
SUBJECT:LAW ON SALES
TIME: ____________DAY:_______
DATE: OF EXAMINATION:________________
TIME OF EXAMINATION:_________________
Page 1
PREPARED BY: Keith O. Rayos, CPA REVIEWED BY: Atty. Ma. Ellen C. Abas, CPANOTED BY: Mary Jane Bautista,
CPA, MBA
a.
b.
c.
d.
Yes. X is liable whether or not he was aware of the hidden defect.
Yes, since the waiver is void. X knew of it but he acted in bad faith in
not disclosing the fact to Y.
No, because Y is in estoppel, having changed engine without prior demand.
No, because Y waived the warranty against hidden defects.
7. Allan bought Billy’s property through Carlos, an agent empowered with a special
power of attorney (SPA) to sell the same. When Allan was ready to pay as
scheduled, Billy called, directing Allan to pay directly to him. On learning of this,
Carlos, Billy's agent, told Allan to pay through him as his SPA provided and to
protect his commission. Faced with two claimants, Allan consigned the payment in
court. Billy protested, contending that the consignation is ineffective since no
tender of payment was made to him. Is he correct?
a. No, since consignation without tender of payment is allowed in the face of
the conflicting claims on the plaintiff.
b. Yes, as owner of the property sold, Billy can demand payment directly tohimself.
c. Yes, since Allan made no announcement of the tender.
d. Yes, a tender of payment is required for a valid consignation.
8. X sold Y 100 sacks of rice that Y was to pick up from X’s rice mill on a particular
date. Y did not, however, appear on the agreed date to take delivery of the rice.
After one week, X automatically rescinded the sale without notarial notice to Y. Is
the rescission valid?
a. Yes, automatic rescission is allowed since, having the character of movables
and consumables, rice can easily deteriorate.
b. No, the buyer is entitled to a customary 30-day extension of his obligation to take
delivery of the goods.
c. No, since there was no express agreement regarding automatic rescission.
d. No, the seller should first determine that Y was not justified in failing to appear.
9. A warranty inherent in a contract of sale to transfer ownership, whether or not
mentioned in it, is known as the
a.
warranty on quality.
b.
warranty against hidden defects.
c.
warranty against eviction.
d.
warranty in merchantability.
10.The buyer acquires a real right to the fruits of thing sold.
a. From the time the obligation to deliver the thing arises;
b. From the perfection of the contract of sale;
c. From delivery thereof;
d. From payment of the price.
11.A buyer may sue the seller for breach of warranty against hidden defects of things
a. Within 40 days from delivery of the thing sold
b. Within 6 months from delivery of the thing sold
c. Within 1 year from delivery of the things sold
d. Within 4 years from discovery of the fraud
12.D is indebted to C in the amount of P200,000 and delivers to C his diamond ring by
way of pledge. If D sells the same diamond ring to T, when will T acquire
ownership of the same?
a. From the time the sale is perfected between D and T
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
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b.
c.
d.
From the time T pays the price to D
From the time C consents to the sale between D and T
From the time T obtains actual possession of the diamond ring
13.This kind of agent merely makes the principal and the third person meet and when
they arrive at an agreement or contract becomes entitled to compensation
a.
Broker
b.
Commission agent
c.
Factor
d.
Attorney at law
14.G appointed S to sell the former’s car for P200,000.00. S sold the car to P for
P200,000.00 but S acted in her own name. After delivery, P inspected the car and
she found hidden defects in the car. Can P file an action against G. even when S
acted in her own name?
a. No, under “caveat emptor” let the buyer beware.
b. Yes, because this is a contract involving property belonging
to the principal.
c. No, because S acted in her own name not of the principal.
d. Yes, because the contract of sale is already perfected
15.A bill of exchange to which no document is attached when presentment for
payment or acceptance is made.
a.
Trade acceptance
b.
Bank acceptance
c.
Clean bill of exchange
d.
Documentary bill of exchange
16.P appointed A his agent for the purpose of selling his car for P600,000 with 10%
commission. A sold the same car to T for P800,000. How much should A pay to P?
a. P600,000 only
b. P540,000 or minus already the 10% commission
c. P800,000
d. P720,000 or minus already the 10% commission
17.The following are the rights of an unpaid seller, except:
a. A right of lien over the thing sold while he is still in possession.
b. In case of insolvency on the part of the buyer, the right of stoppage
in transit.
c. Right to resell the things sold.
d. Right to interest on the price of the sale.
18.The following are instances of pledge created by operation of law, except.
a. Hotel keeper retains the things brought into the hotel by the guest who cannot pay his
hotel bills.
b. An agent retains in pledge the thing which is the object of the agency
regarding his commission.
c. A mechanic retains the car he repaired until he is paid.
d. A depository retains the thing deposited until he is paid the charges due him.
19.S and B agreed on the sale of a four hectare property at Macapagal Boulevard for
the price of P75,000 per square meter on condition that if the price is not paid on a
particular date, the sale will be considered automatically cancelled. On the
particular date agreed upon, B did not pay S, but B never asked for a judicial
cancellation nor made a notarial act of rescission. In this casea. The sale is cancelled as per agreement.
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
Page 3
b.
c.
d.
S can validly refuse any subsequent offer to pay by B.
B can still pay S the price.
B cannot anymore pay the price simply because the sale is cancelled due to his failure
to pay on the stipulated date.
20.On December 15, 2006, S offered to sell to B his house and lot for P5,000,000. B
requested S to give him 60 days within which to raise the P5,000.000. On February
5, 2007, before the expiration of the 60 day period, S informed B that he has raised
the price to P7,000,000. Can B, under the circumstances, compel S to accept
P5,000,000 as payment for the house and lot?
a. No – because as between S and B there is as yet no perfected sale
b. Yes – because it was S who made the offer and B is just accepting the same
c. No – because in a contract of sale S has the exclusive right to fix the price to which B
can only concur
d. Yes – because he impliedly committed himself to P5,000.00 in not rejecting the request
of 60 days by B in order to raise the money
21.Which of these is not a special form of payment?
a.
Application of payment
b.
Dacion en pago
c.
Cession en pago
d.
Tender of payment and consignation
22.In which of these cases does the law not allow the recovery of deficiency
judgment?
a. In a sale of personal property on the installment basis should the buyer fail
to pay two or more installments after foreclosure of the chattel mortgage
b. In a contract of real estate mortgage
c. In a contract of antichresis
d. In a contract of chattel mortgage
23.A purchased on installment from B a house and lot. After a year of installment
payment, A died. B refuses to accept the monthly installment being tendered by his
heirs contending that upon the death of their father with whom he has a contract,
the contract automatically terminated and/or cancelled. B is:
a. Wrong for right acquired in virtue of an obligation is
transmissible;
b. Wrong for the right to continue the payment is personal only to A;
c. Correct for the contract is between him and A only;
d. Correct because the parties did not agree on the transmissibility of the
right.
24.D and C agreed that D shall deliver to C ten (10) kilos of marijuana instead of
paying D’s loan amounting to P1Million. Therefore:
a. D’s obligation is extinguished.
b. D must deliver 10 kilos of marijuana.
c. D must pay the 1Million.
d. D may choose between the two obligations.
25.D borrowed from C P1,000,000 to secure the payment of which the former verbally
agreed to deliver his 4 hectare agricultural land by way of antichresis and to pay
12% interest per annum. The contract of loan and antichresis a. Are both valid
b. Both null and void
c. The loan is valid but the antichresis is null and void
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
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d.
The contract of antichresis is valid, but the loan is null and void.
26.Which of these is not an essential requisite common to both pledge and mortgage?
a. That the pledge or mortgage be constituted to secure the fulfillment of
a principal obligation.
b. That the pledgor or mortgagor be the principal debtor.
c. That the pledgor or mortgage has the free disposal of the properties.
d. That it is the essence of a pledge or mortgage that if the obligation is
not paid the things in which the pledge or mortgage consist may be
alienated for the payment of the debt.
27.In sale of a land with a non-apparent servitude, a hidden defect, the buyer can
rescind the sale within period of time?
a.
6 months from the date of delivery
b.
40 days from the date of delivery
c.
3 days from the discovery of the hidden defect
d.
1 year from the execution of the contract of sale
28.A form of delivery which takes place after the seller of the property continues in
possession of said property no longer as owner but as a mere possessor:
a.
Traditio constitutum possessorium
b.
Traditio calvis
c.
Traditio brevi-manu
d.
Quasi-traditio
29.P orally appointed A as his agent to sell former’s land. On January 3, 2001, A sold
the land to B who forthwith took possession thereof. It turned out however, that on
January 1, 2001, P, without informing A, had already sold the same land to C, who
up to now has not taken possession of the same land. Neither of the sales was
registered. Whose contract shall prevail?
a. The sale to B for he was first in possession in good faith;
b. The sale to C for the land was first sold to him by the owner.
c. The sale to B for the agent was duly authorized to sell the land.
d. The sale to C because the sale to B was void, A was not duly authorized
by P.
30.S sold to A in a memorandum of agreement of sale his parcel of land. After a week,
S sold the same land to B in a formal deed of sale. Upon buying the land, B who
was aware of the sale to A, immediately took possession thereof and registered the
sale in his favor. When informed of the second sale, A subsequently registered an
adverse claim with the Registry of Deeds. The parcel of land shall belong to:
a. A, because he has the older title.
b. B, because the sale to him was in a formal deed of sale.
c. B, because he first registered the sale in his favor.
d. B, because he was the first possessor of the land.
31.When things are delivered to the buyer on approval, trial, or satisfaction, the
ownership passes to the buyer:
a. Upon delivery of the things
b. Upon meetings of minds
c. Upon conception of the sale
d. Upon the return of the things to the seller
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
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32.When goods are delivered to the buyer on “sale or return”, the ownership passes to
the buyer:
a. Upon delivery of the goods
b. Upon the expiration of the period agreed upon
c. Upon acceptance of the buyer of the seller’s offer
d. Upon perfection of the sale
33.D constituted a chattel mortgage on his car as security for the loan he obtained
from C of P1M. It was further stipulated that the same mortgage shall secure the
payment of another loan which the debtor D may incur in the future. Is the chattel
mortgage valid?
a.
The chattel mortgage for both loans is valid.
b.
The mortgage for the P1M is the only one valid.
c.
The mortgage as regards the future loan is the one valid.
d.
The mortgage is extinguished because of the void stipulation on the
ground that it cannot secure a future obligation.
34. P authorized A and B to sell his room air conditioner. Through the negligence of A,
the thing was stolen when the latter left it unattended in his shop. Who is liable to P
for damages?
a.
Only A is liable because he was the one at fault despite their
solidary liability having been appointed simultaneously.
b.
Both of them are liable and B shall be reimbursed by A for his
payment to P.
c. Either of them is liable at P’s option.
d. Only A is liable because of their joint liability to P.
35.P and M appointed A to sell the land they own in common with the stipulation that
A will advance the necessary funds to execute the agency. Who is liable to A for
reimbursement of all the funds?
a. P and M will share equally and thereof A may demand one-half only from either.
b. Either or both shall be liable for the entire amount.
c. Neither shall be liable since it was stipulated that A shall advance the funds to
execute the agency.
d. P and M shall not be liable because the expenses were incurred as a
consequence of the performance of the agent’s obligation.
36.In one of the following cases, delivery of the goods to a carrier for the purpose of
transmission to the buyer transfers ownership to the latter. Which one is it?
a. When by the terms of the bill of lading, the goods are to be delivered to the
seller or his agent.
b. When by the terms of the bill of lading, the goods are to be delivered to the
order of the buyer or his agent but the seller retains the bill of lading.
c. When the seller draws a bill of exchange on the buyer for the price of the goods
and transmits such bill of exchange and the buyer dishonors the bill of
exchange.
d. When the owner does not reserve the right of possession or ownership
of the thing sold upon delivery to the carrier.
37.D borrowed P50,000.00 from C. the parties agreed in a private instrument that D’s
goods which are deposited in the warehouse of W would secure the loan by way of
pledge. C never took actual possession of the goods, nor did the parties agree that
the goods will remain with W. Was pledged constituted on the goods?
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
Page 6
a. Yes, because mere agreement that the goods would secure the debt is
sufficient.
b. No, the goods must be delivered to C, or there must be a common
agreement that the goods will remain in the possession of W.
c. Yes, delivery of the goods to the creditor is not required if they are in the control
and possession of a third person.
d. No, the pledge should be in a public instrument for the pledge to be constituted.
38.A gave B P50,000.00 on the purchase of a TV set on behalf of the former, with the
obligation of returning the amount if the TV set was not bought within a week. A
did not buy the item but did not return the amount. An estafa case was filed by A
against B. B pleaded A to drop the case. In return, B issued a promissory note in
favor of A for the amount involved. Is the promissory note valid?
a. No, the consideration of the note is the stifling of the crime of estafa.
b. No, the consideration of the note is unlawful.
c. Yes, if the note is negotiable because of mutual consent.
d. Yes, the note is in consideration of a pre-existing debt.
39.Mercado bought a piece of land from Santiago for a lump sum of P120,000.00.
Aside from mentioning the boundaries in the contract which is required in the sale
of real estate, the contract also states that the piece of land consists of 1,000
square meters. Before delivery, Santiago discovered that the land actually contains
1,2000 square meters
a. Santiago must deliver all the 1,200 square meters. Mercado must pay
P120,000.00 plus an additional amount for the excess of 200 square meters.
b. Santiago is required to deliver only 1,000 square meters; Mercado must pay the
contract price of P120,000.00.
c. Santiago must deliver all the 1,200 square meters; Mercado has to pay
only P120,000.00.
d. Neither party is required to perform the obligation because of the mistake.
40.Essential elements of chattel mortgage, except
a. The object is a personal or movable property.
b. The thing mortgage is not delivered to the creditor.
c. The mortgagor cannot sell without the consent of the mortgagee.
d. Description of the thing mortgage must appear in the public
instrument.
41.G, guardian of M, 17 years old, sold the palay harvested from the land belonging to
M for P37,500.00. The palay had a value of P50,000.00. M wants to recover the
damages he suffered under the contract entered into by his guardian. What
remedy is available to M?
a. Annulment because M was only 17 years old at the time the sale was made.
b. Rescission because M suffered lesion of P12,500.00.
c. Either rescission or annulment.
d. Neither rescission or annulment.
42.S sold to A in a memorandum of agreement of sale his parcel of land. After a week,
S sold the same land to B in a formal deed of sale. Upon buying the land, B who
was aware of the sale to A, immediately took possession thereof and registered the
sale in his favor. When informed of the second sale, A subsequently registered an
adverse claim with the Registry of Deeds. The parcel of land shall belong to:
a. B, because the sale to him was in a formal deed of sale.
b. B, because he first registered the sale in his favor.
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
Page 7
c. B, because he was the first possessor of the land.
d. A, because he has the older title.
43.The following are the rights of an unpaid seller, except:
a. A right of lien over the thing sold while he is still in possession.
b. In case of insolvency on the part of the buyer, the right of stoppage in transit.
c. Right to resell the things sold.
d. Right to interest on the price of the sale.
44.Lino entered into a contract to sell with Ramon, undertaking to convey to the latter
one of the five lots he owns, without specifying which lot it was, for the price of P1
million. Later, the parties could not agree which of five lots he owned Lino
undertook to sell to Ramon. What is the standing of the contract?
a. Unenforce
b. Voidable
c. Rescissibl
d. Void
able
e
e.
45.Roy and Carlos both undertook a contract to deliver to Sam in Manila a boat docked
in Subic. Before they could deliver it, however, the boat sank in a storm. The
contract provides that fortuitous event shall not exempt Roy and Carlos from their
obligation. Owing to the loss of the motor boat, such obligation is deemed
converted into one of indemnity for damages. Is the liability of Roy and Carlos joint
or solidary?
a. Neither solidary nor joint since they cannot waive the defense of fortuitous
event to which they are entitled.
b. Solidary or joint upon the discretion of Sam.
c. Solidary since Roy and Carlos failed to perform their obligation to deliver the
motor boat.
d. Joint since the conversion of their liability to one of indemnity for
damages made it joint.
e.
f.
46.A vendor-de-retro shall be entitled to redeem the object of sale within
a. Four years if no period is agreed upon.
b. Thirty days from notice of intention to repurchase.
c. Ten years if there is a period stipulated.
d. The period agreed upon.
e.
47.Samson sold a registered piece of land to Atienza on May 1, 2013 in a public
instrument. On May 3, 2013, Samson sold in a private instrument the same piece
of land to Cruz, who took physical possession of the land. Neither buyer was aware
of the sale made to the other.
a. The land belongs to Atienza.
b. The land belongs to Cruz.
c. The land still belongs to Samson, because both sales are void.
d. The land should be divided equally between Atienza and Cruz to give effect to
both sales.
e.
48.Refer to the preceding number, assume that on May 5, 2013, Samson sold the land
in a public instrument to Domingo who was not aware of the two previous sales.
Domingo then registered the sale with the Register of Deeds.
a. The land belongs to Atienza.
b. The land belongs to Cruz.
c. The land belongs to Domingo.
d. The land will be equally divided among the three buyers.
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
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e.
49.A appointed B as his agent to sell his car for P250,000.00. B sold the car to C for
P250,000.00 but B acted in his own name. After delivery, C inspected the car and
she found hidden defects in the car. Is A, as principal, liable to C even if B acted in
his own name?
a. No, applying “caveat emptor” or let the buyer beware.
b. Yes, because this is a contract involving property belonging to the
principal.
c. No, because the contract of sale is between B and C.
d. Yes, if C was aware of the hidden defects.
e.
50.T steals the goods of O and deposits them in the warehouse of W. W issues to T
warehouse receipt which by its terms indicates that goods are to be delivered to
the order of T. T thereafter, negotiates the receipt to H who purchases the
document in good faith and for value.
a. H may obtain delivery of the goods from W because H was an innocent
purchaser for value.
b. H can obtain delivery of the goods from W because the issuance of the
warehouse receipt to T conferred a valid title to him over the goods.
c. H can obtain delivery of the goods from W because the acquisition by H of the
warehouse receipt in good faith cured the defect in T’s title.
d. H cannot obtain delivery of the goods because he acquired whatever
title T had over such goods, which is the title of the thief.
e.
51.Statement 1: A contract whereby one person transfers the ownership of nonfungible things to another with the obligation on the part of the latter to give things
of the same kind, quantity and quality shall be considered a loan.
a. Statement 2: Precarium is a kind of mutuum where the bailor may demand the
thing loaned at will.
b. Both are true.
d. Only first statement is false.
c. Both are false.
e. Only second statement is false.
f.
52.P gave a special power of attorney to a to sell P’s house and lot. On May 1, 2013, A
sold the house and lot to X through a deed of absolute sale which was duly
acknowledged before a notary public. On May 5, 2013, P sold the house and lot to Y
not knowing that A had already sold the same to X. although the deed of sale in
favor of Y had not been acknowledged before a notary public by P and Y, Y
immediately took possession of the house and lot. X and Y were not aware of the
sale made to the other.
a. X is the owner of the house and lot.
b. Y is the owner of the house and lot.
c. Y and Y become the co-owners of the house and lot.
d. Remains the owner of the house and lot.
e.
53.B bought from Century Properties, Inc., a 1,000 square- meter lot located beside
the Manila International Airport on which he intended to construct a warehouse
condominium. The terms of the sale provided for the payment of the contract price
of P300,000.00 in 60 equal monthly installments of P5,000.00 each. After having
paid 36 installments, B defaulted in the payment of the succeeding installments. As
a consequence, Century cancelled the sale. B now wants to claim the return of the
cash surrender value of the payments he had made pursuant to the “Realty
Installment Buyer Act”, otherwise known as the Maceda Law.
a. B is entitled to a cash surrender value of 50% of P180,000.00 or
P90,000.00 under the Maceda Law.
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DATE: OF EXAMINATION:________________
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b. B is entitled to a cash surrender value of 55% of P180,000.00 or P99,000.00
under the Maceda Law.
c. B is entitled to a cash surrender value of 90% of P180,000.00 or P162,000.00
under the Maceda Law.
d. B cannot invoke the Maceda Law for the return of any of the payments he had
for the lot he purchased.
e.
54.Upon the proposal of a third person, a new debtor substituted the original debtor
without the latter’s consent. The creditor accepted the substitution. Later, however,
the new debtor became insolvent and defaulted in his obligation. What is the effect
of the new debtor’s default upon the original debtor?
a. The original debtor is freed of liability since novation took place and this
relieved him of his obligation.
b. The original debtor shall pay or perform the obligation with recourse to
thenew debtor.
c. The original debtor remains liable since he gave no consent to the substitution.
d. The original debtor shall pay or perform 50% of the obligation to avoid unjust
enrichment on his part.
e.
55.In which of these cases does the law not allow the recovery of deficiency
judgment?
a. In a sale of personal property on the installment basis should the
buyer fail to pay two or more installments after foreclosure of the
chattel mortgage
b. In a contract of real estate mortgage
c. In a contract of antichresis
d. In a contract of chattel mortgage
e.
56.Action by the vendee against the vendor to nullify the sale due to some vices or
defect which render object of sale unfit for the use intended or knowledge of which,
the vendee would not have bought the thing
a. Accion quantiminoris
c. Accion pauliana
b. Accion reinvidicatoria
d. Redhibilitory action
e.
57.Knowing that the car had a hidden crack in the engine, X sold it to Y without
informing the latter about it. In any event, the deed of sale expressly stipulated
that X was not liable for hidden defects. Does Y have the right to demand from X a
reimbursement of what he spent to repair the engine plus damages?
a. Yes. X is liable whether or not he was aware of the hidden defect.
b. Yes, since the waiver is void. X knew of it but he acted in bad faith in
not disclosing the fact to Y.
c. No, because Y is in estoppel, having changed engine without prior demand.
d. No, because Y waived the warranty against hidden defects.
e.
58.Warranty against hidden defects is
a. An essential element
c. An accidental element
b. A natural element
d. An artificial element
e.
59.D borrowed P50,000.00 from C. the obligation bears interest of 10% per annum. To
secure the debt, D agreed with C that the fruits from the agricultural lot of D shall
answer for the interest and the principal obligation. Assuming the form required by
law was complied with, the contract entered into between D and C for the
application of the fruits of the lot to the interest and principal obligation is known
as:
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
Page 10
a. Antichresis
c. Real estate mortgage
b. Pledge
d. Chattel mortgage
e.
60.Not a mode of extinguishing an agency
a. Accomplishment of agency
b. Death of the principal, and the agency is for the interest of either the
principal or agent
c. Insanity of the principal or agent
d. Dissolution of the firm or corporation which entrusted or accepted the agency
e.
61.Statement 1: A stipulation prohibiting the owner from alienating the immovable
mortgaged shall be void.
a. Statement 2: The equity of redemption refers to the right of the mortgagor to
redeem the mortgaged property within a certain period of time after it was sold to
a third person.
b. True, True
d. False, True
c. True, False
e. False, False
f.
62.Statement 1: Should there be a stipulation that the agent shall advance the
necessary funds, he shall be bound to do so even when the principal is insolvent.
a. Statement 2: Agency is presumed to be with compensation unless there is a
proof to the contrary.
b. Both are true.
d. Only statement 1 is true.
c. Both are false.
e. Only statement 2 is true.
SUBJECT:LAW ON SALESS
DATE: OF EXAMINATION:________________
Page 11
DIVINE WORD COLLEGE OF CALAPAN
ACCOUNTANCYDEPARTMENT
DEPARTMENTAL EXAMINATION
f.
63.R, S and T are co-owners of an undivided parcel of land. R sold his 1/3 interest to T in a deed
of absolute sale. Which if correct?
a. S may exercise the right of redemption on the interest sold by R to T.
b. S cannot exercise the right of redemption.
c. The sale made by R to t is voidable.
d. S may redeem only ½ of the interest sold by R to T.
e.
64.B1 and B2 are co-owners of land and they named and authorized A to sell their land. Who will
be liable to A for the payment of his commission?
a. Both B1 and B2 jointly.
b. Both B1 and B2 solidarily liable only if stipulated.
c. Both B1 and B2 solidarily liable even without stipulation.
d. 50% from B1 and 50% from B2.
e.
65.An agricultural land is owned by A and D pro-indovisio. D sells his ½ part to R, who is the
owner of the adjoining land. When A learned of the sale, he tried to redeem the portion sold
by D by reimbursing R with the purchase price and expenses. Which is not correct?
a. A can compel R to permit redemption.
b. A co-owner of the thing may exercise the right of redemption in case the shares of the
other co-owner or any one of them are sold to a third person.
c. The sale to R is valid but A can elect to exercise his right of redemption.
d. The sale to R is valid and as adjoining land owner he is the one entitled to
redemption.
e.
66.A sells to B a Sony colored TV for P12,000.00 payable in twelve equal monthly installments
beginning May 5, 2012 and every 5th day of each month thereafter. The contract provides that
upon failure to pay any installment due, the whole balance becomes due and demandable. To
secure the obligation, a chattel mortgage over the TV set was executed. When B defaulted on
the seventh and eighth installments, A sued B for the payment of the whole balance of
p6,000.00. the TV set was levied and subsequently sold at a public sale for P5,000.000 can A
still recover the deficiency of P1,000.00 from B?
a. Yes, if there was stipulation to that
c. No, any stipulation allowing recovery
effect.
is void.
b. Yes, even there was no
d. No, if there is no stipulation to that
stipulation.
effect.
e.
67.C mortgaged his car to B for P200,000.00. C failed to pay his obligation. B sold it at a public
auction for P180,000.00. Can B recover the deficiency?
a. Yes, even without stipulation.
c. No, even if there is stipulation.
b. Yes, if there is stipulation.
d. No, unless there is stipulation.
e.
68.An agreement where the pledgor or mortgagor will execute a contract transferring ownership
of the property pledged or mortgaged to the pledge or mortgagee in case of default, such
execution of the contract will result to
a. Pactumcommissorium.
c. Dacion en pago.
b. Payment by cession.
d. Tender of payment
e.
69.A pledged his ring to B for P20,000.00. A failed to pay his obligation. B sold it at a public
auction for P18,000.00. can B recover the deficiency?
a. Yes, even without stipulation.
c. No, even if there is stipulation.
b. Yes, if there is stipulation.
d. No, unless there is stipulation.
e.
70.In a contract of sale of a personal property the price of which is payable in installments, the
vendor may exercise any of the following remedies, except to:
a. Exact fulfillment of the obligation, should the vendee fail to pay any number of
installments..
b. Cancel the sale, should the vendee’s failure to pay cover two or more installments.
SUBJECT:LAW ON SALES BAIL
TIME: ____________DAY:_______
DATE: OF EXAMINATION:________________
TIME OF EXAMINATION:_________________
Page 12
PREPARED BY: Keith O. Rayos, CPAREVIEWED BY: Att. Ma. Ellen C. Abas, CPANOTED BY: Mary Jane Bautista,
CPA, MBA
c. Foreclose the chattel mortgage on the property if the
vendee’s failure to pay cover two or more installments and
recover any deficiency after the foreclosure sale if they have
stipulated it.
d. Foreclose the chattel mortgage on the property if the vendee’s
failure to pay cover two or more installments but he may no longer
recover any deficiency after the foreclosure sale.
e.
71.D obtained a 12-month loan of P100,000.00 from C. D constituted a
mortgage on a certain lot which he knew belonged to X. on due date:
a. C cannot collect from D because the obligation is rendered void, D,
the mortgagor, not being the owner of the mortgaged lot.
b. C can collect from D because the mortgagor need not be the owner
of the property.
c. C can collect from D because although the mortgage is void,
the loan obligation can stand independently from it.
d. C cannot collect from D because the latter was not authorized by
any power of attorney to mortgage the lot.
e.
72.Delivery of incorporeal property may be made through any of the
following means, except;
a. Execution of a public document.
b. Placing the title of ownership in the possession of the vendee.
c. Use by the vendee of his rights, with the debtor’s consent.
d. Execution of private instrument.
e.
73.B obtained a loan of P100,000.00, secured by a pledge of diamond ring
from C. the parties had a stipulation that should D fail to pay the debt
on due date, C may purchase the diamond ring at the current purchase
price. Is the stipulation valid?
a. NO, such stipulation is in the nature if pactumcommissorium.
b. Yes, the purchase pf the ring by C at the current price does
not come within the prohibition on pactumcommissorium.
c. No, but C can still purchase the ring if it is not sold at two public
auctions.
d. Yes, but C can only purchase the ring if it is not sold at two public
auctions.
e.
74.Which of the following statements is incorrect with respect to the
contract referred to in the preceding number?
a. An immovable belonging to a person other than debtor may secure
the obligation of the debtor.
b. The contract subsists as long as the obligation of the debtor
remains unpaid.
c. The creditor may appropriate for himself the immovable if
the debtor fails to pay his obligation.
d. The debtor may be compelled by the creditor to enter into the
enjoyment of the immovable if the creditor desires to exempt
himself from the taxes and charges upon the estate and the
expenses for its preservation and repair.
e.
SUBJECT:LAW ON SALES BAIL
DATE: OF EXAMINATION:________________
75.Which of the following statements is incorrect with respect to the
contract referred to in the preceding number?
a. An immovable belonging to a person other than debtor may secure
the obligation of the debtor.
b. The contract subsists as long as the obligation of the debtor
remains unpaid.
c. The creditor may appropriate for himself the immovable if the
debtor fails to pay his obligation.
d. The debtor may be compelled by the creditor to enter into
the enjoyment of the immovable if the creditor desires to
exempt himself from the taxes and charges upon the estate
and the expenses for its preservation and repair.
e.
76.Which of the following is not correct?
a. The vendor is bound to deliver the thing sold and its accessions and
accessories in the condition in which they were upon the perfection
of the contract.
b. All the fruits of the thing sold shall pertain to the vendor
from the day on which the contract was perfected.
c. The vendor shall not be bound to deliver the thing sold, if the
vendee has not paid him the price, or if no period for the payment
has been fixed in the contract.
d. The vendor is bound to transfer the ownership of and deliver, as
well as warrant the thing which is the object of sale.
e.
77.D is obliged to give C a specific ring. The parties agreed that D may
give a specific necklace as substitute. Which of the following
statements is true?
a. If the ring is lost through a fortuitous event before
substitution, the obligation is extinguished.
b. If the necklace is lost through fortuitous event before substitution,
the obligation is extinguished.
c. If the necklace is lost though debtor’s fault before substitution, the
debtor shall pay damages.
d. If the ring is lost through the debtor’s fault after substitution, the
debtor shall pay damages.
e.
78.D and C agreed that D shall deliver to C ten (10) kilos of marijuana
instead of paying D’s loan amounting to P1Million. Therefore:
a. D’s obligation is
c. D must pay the 1Million
extinguished
d. D may choose between the
b. D must deliver 10 kilos of
two obligations
marijuana
e.
79.The following are instances of pledge created by operation of law,
except.
a. Hotel keeper retains the things brought into the hotel by the guest
who cannot pay his hotel bills.
b. An agent retains in pledge the thing which is the object of the
agency regarding his commission.
c. A mechanic retains the car he repaired until he is paid.
SUBJECT:LAW ON SALES BAIL
DATE: OF EXAMINATION:________________
d. A depository retains the thing deposited until he is paid the
charges due him.
f.
80.B received at his office a brand new computer printer. The printer was
delivered to B after the latter filled up a coupon which he cut from a
magazine where Supreme Machines Company placed an advertisement
allowing a “Free Trial for 7 days” of the printer to prospective
customers. After trying the printer shortly after its delivery to him, B
placed it on a table located just beside a glass window. B forgot all
about the printer until two weeks later. By that time, the plastic parts
had been deformed because of its long exposure to sunlight such that
the printer would no longer function.
a. The ownership of the printer was transferred to B upon its delivery
to him.
b. B must pay for the price of the computer.
c. Is not liable for the damage because it was caused by a fortuitous
event.
d. Supreme Machines Company must shoulder the damage because it
retained ownership of the printer despite the delivery.
g.
81.On January 5, Max, who was going abroad as immigrant, offered to sell
his car for P150,000.00 to Baldo. He informed Baldo, however, that he
wanted to rent the car for P1,000.00 per day up to January 15 as soon
as the sale is executed since his flight was not scheduled until the 16 th.
Baldo accepted both offers, and accordingly, he and Max executed a
contract of sale and the contract of lease simultaneously on the same
day, January 5. All the while, Max remained in physical possession of
the car until January 10 when the car was stolen without his fault. The
car was never recovered.
a. Max must bear the loss by returning the sum of P150,000.00 since
Baldo did not become the owner not having obtained physical
possession thereof.
b. Baldo must bear the loss because he acquired ownership of
the car despite its lack of physical delivery to him.
c. Both Max and Baldo must share equally in the loss.
d. Max must bear the loss by returning P150,000.00 less P5,000.00,
the rental of the car for 5 days, in partial compensation.
h.
82.A bought form B a car at a price of P2,000,000.00, FOB Factory. A paid
P1,000,000.00 as a down payment and the balance within one month
from delivery. The car was picked up by A upon payment of the down
payment on April 24, 2013. On May 10, 2013, B learned of A’s
insolvency. In this case B shall be entitled to
a. Remedy of possessory lien.
c. Remedy of stoppage in
b. Remedy of resale.
transit.
d. Remedy of rescission.
e.
83.D obtained from C a loan amounting to P50,000.00, the same being
secured by a mortgage on D’s lot. Thereafter, C assigned his credit
right to T with notice to D. Based on the foregoing facts, which of the
following statements is incorrect?
SUBJECT:LAW ON SALES BAIL
DATE: OF EXAMINATION:________________
a. T cannot collect from D if D does not give his consent to the
assignment.
b. T can collect from D. D’s consent to the assignment is not required.
c. T can collect from D and if D cannot pay, t can foreclose the
mortgage on the lot.
d. The notice to D of the assignment is sufficient. D must make his
payment to T and no longer to C.
e.
84.P appointed A as his agent. For more than 5 years, A transacted
business with the general public including X. on the 6 th year of the
agency, P revoked the authority of A as his agent by giving a notice of
revocation to A and causing the publication of the Revocation in the
Manila Bulletin on the same day that P revoked A’s authority, in the
course of his usual business transactions with A as P’s agent, sold and
delivered goods to A. X now sues P for the price of the goods.
a. P is liable to X because X did not read the publication of the
revocation of A’s power.
b. P is not liable because the revocation as published is
binding upon any person including X although X has not
read the publication.
c. P is liable to X because P should specially informed C that A’s
authority had been revoked.
d. P is liable because A was a customer of long standing and must be
given the benefit of the doubt.
e.
85.P appointed A his agent for the purpose of selling his car for P600,000
with 10% commission. A sold the same car to T for P800,000. How
much should A pay to P?
a. P600,000 only
c. P800,000
b. P540,000 or minus already
d. P720,000 or minus already
the 10% commission
the 10% commission
e.
86.A buyer may sue the seller for breach of warranty against hidden
defects of things
a. Within 40 days from delivery of the thing sold
b. Within 6 months from delivery of the thing sold
c. Within 1 year from delivery of the things sold
d. Within 4 years from discovery of the fraud
f.
87.Allan bought Billy’s property through Carlos, an agent empowered with
a special power of attorney (SPA) to sell the same. When Allan was
ready to pay as scheduled, Billy called, directing Allan to pay directly to
him. On learning of this, Carlos, Billy's agent, told Allan to pay through
him as his SPA provided and to protect his commission. Faced with two
claimants, Allan consigned the payment in court. Billy protested,
contending that the consignation is ineffective since no tender of
payment was made to him. Is he correct?
a. No, since consignation without tender of payment is allowed
in the face of the conflicting claims on the plaintiff.
b. Yes, as owner of the property sold, Billy can demand payment
directly tohimself.
c. Yes, since Allan made no announcement of the tender.
SUBJECT:LAW ON SALES BAIL
DATE: OF EXAMINATION:________________
d. Yes, a tender of payment is required for a valid consignation.
g.
88.X constituted a chattel mortgage on a car (valued at Php1 Million
pesos) to secure a P500,000.00 loan. For the mortgage to be valid, X
should have
h.
i. The right to mortgage the car to the extent of half its value.
a
j.
b
l. m.
c
n.
d
k. Ownership of the car.
Delivered the car to the creditor.
o. Registered the car in his name.
89.A sale between husband and wife is valid in which of the following
cases?
a. When a separation of property has been agreed upon in the
marriage settlements or when there has been a judicial
separation of property.
b. When price of the sale is a moderate amount.
c. When the object of the sale is a necessary such as food or clothing.
d. When the spouses are living separately.
p.
90.D borrowed P100,000.00 from C. to secure his debt, D mortgaged his
land and building in favor of C. the mortgage is registered with the
Registry of Property. Sometime later, D sold the land and building to X
who was not aware of the mortgage of the land and building. Based on
the above information, which of the following statements is false?
a. X must respect the mortgage although he was not a party thereto.
b. X was not bound by the mortgage because he was not
aware of it.
c. If C foreclose the mortgage and the proceeds of the foreclose sale
are not enough to pay for the debt, C can recover the deficiency
from D.
d. If C foreclose the mortgage and the proceeds of the foreclosure sale
exceed the amount of debt, D is entitled to the excess.
q.
91.Statement 1: If the agent has been empowered to borrow money he
may himself be the lender at the current rate of interest and if he has
been authorized to lend money at interest, he can borrow it.
r. Statement 2: Every agent is bound to render an account of his
transactions and to deliver to the principal whatever he may have
received by virtue of the agency even though it may not be owing to
the principal.
a. Both are true.
d. Only second statement
b. Both are false.
is true.
c. Only first statement is true.
e.
92.In which of the following acts may a person not appoint an agent?
SUBJECT:LAW ON SALES BAIL
DATE: OF EXAMINATION:________________
a. To represent the principal in a wedding ceremony where the
principal is a principal sponsor.
b. To vote for the principal during the meetings of stockholders where
the principal is a stockholder.
c. To represent the principal in a baptismal ceremony where the
principal is the father of the child to be baptized.
d. To attend a meeting of the board of directors of a
corporation where the principal is a director.
f.
g.
h.
93.A sold his car to B payable in ten equal monthly installments and with a
mortgage constituted on the same property. For B‘s failure to pay a
month’s installment, which statement is correct?
a. A may foreclose the mortgage on B’s car but he has no longer the
right to recover the balance should it be sold for an amount lower
than what he claims from B.
b. A may seek the cancellation of the sale made to B.
c. A may seek fulfillment of the obligation of B to pay the
entire purchase price.
d. A may seek the cancellation of the sale and later on foreclose the
mortgage should he find it impossible to collect from B.
i.
94.Statement 1: In a sale at public auction, the pledgor or owner may be
a bidder and shall have a better right if he should offer the same terms
as the highest bidder.
j. Statement 2: Pledge is a real contract.
SUBJECT:LAW ON SALES BAIL
DATE: OF EXAMINATION:________________
Divine Word College of Calapan
ACCOUNTANCY DEPARTMENT
FINAL EXAMINATION
SUBJECT:
a. True, True
c. False, True
b. True, False
d. False, False
e.
95.P appoints A1 and A2 as his agents. A1 and A2 agreed to be bound solidarily. Suppose A1
performed the agency negligently which caused damaged to P, can P hold A2 liable for
damages?
I. Yes, is A1 acted within the scope of his maturity.
II. No, if A1 acted beyond the scope of his authority.
a. Both statements are true.
c. Only statement 1 is true.
b. Both statements are false.
d. Only statement 2 is true.
e.
96.The principle of “caveat emptor” or let the buyer beware will not apply in
a. Sheriff’s sale
c. Auction sales
b. Sales of animals in pairs
d. Sales of livestock as condemned
e.
97.S sold to B a lot through a deed of absolute sale duly acknowledge before a notary public.
Three days later, S sold the same lot to X, also through a deed of sale duly acknowledge
before a notary public. X had the sale registered with the Register of Deeds. Neither B nor X
was aware of the sale made by S to the other and neither took physical possession of the lot.
Who is the present owner of the lot?
a. B, because he was the first purchaser in good faith.
b. X, because he register the sale in good faith.
c. Neither B nor X.
d. S, as long as he does not surrender physical possession of the lot.
e.
98.D pledged his 100 shares of stock of San Miguel Corporation to C to secure his debt of
P5,000.00. on due date, D was not able to pay the debt, so C caused the sale of the shares at
public auction. The shares of stock were sold at P4,500.00.
a. To extinguish the obligation, C may recover the deficiency of P500.00 from D if there is a
stipulation to that effect.
b. To extinguish the obligation, C may recover the deficiency even if there is no stipulation to
that effect.
c. To obligation is extinguished even if there is a deficiency of P500.00.
Accordingly, C can no longer recover the deficiency.
d. The obligation is extinguished only if the proceeds of sale amount to P5,000.00 or more.
e.
99.When is appropriation by the creditor of the thing given as security allowed in pledge, real
mortgage and chattel mortgage?
a. When the thing given as security in real mortgage is not sold at two public auctions.
b. When the thing given as security in pledge is not sold at two public auctions.
c. When the thing given as security in chattel mortgage is not sold at two public auctions.
d. No appropriation is allowed in either pledge, real mortgage or chattel mortgage.
e.
100. Statement 1: If the thing pledge is returned by the pledge to the pledgor or owner, the
pledge is extinguished, except if there is a stipulation to the contrary.
a. Statement 2: If subsequent to the perfection of the pledge, the thing is in the possession
of the pledgor or owner there us a conclusive presumption that the same has been returned
by the pledge.
b. Both are true.
d. Only first statement is true.
c. Both are false.
e. Only second statement is true.
SUBJECT:
TIME: 12:30-3:30PM TTH
Prepared by: DENNIS NIEVA DIMAANO, CPA
DATE OF EXAMINATION:________________________
TIME OF EXAMINATION: ________________________
Noted by: JHON PAULO G. DE PADUA,CPA
Page 19
Ms. MARY JANE R. BAUTISTA, CPA, MBA
f.