RFBT II
1. Which of the following statements relative to "watered stock" is false? (CPALE
May 2023)
a. It is issued for a consideration that is less than par or issued value.
b. It is void per se.
c. The director or officer having knowledge thereof and without raising any
objection thereto is solidarily liable with the stockholder to the corporation and
its creditors for the difference between the par or issued value and the
consideration.
d. None of the foregoing.
2. One of the following transactions does not require the adequacy of unrestricted
retained earnings: (CPALE May 2023)
a. Redemption of redeemable shares
b. Dividend on common stock
c. Reacquisition on treasury shares
d. Dividend on preferred stock
3. Which of the following statements relative to the sale of personal property
installment under Article 1484 of the Civil Code (Recto Law) is false? (CPALE
May 2022)
a. The remedy of exacting fulfillment of the obligation can be availed of only
where one (1) installment is not paid.
b. Cancellation of the sale can only be made after default of at least two (2)
installments.
c. An agreement for the recovery of any unpaid balance of the purchase price
after electing to foreclose the chattel mortgage on the thing sold is null and
void.
d. The three remedies under Article 1484 of the Civil Code are alternative and
cannot be exercised simultaneously or successively.
4. The term finance charge includes, except (CPALE Oct 2023)
a. interest
b. premium
c. service charges
d. other charges
