Question

S1: Directors as a rule are entitled to compensation as directors but not exceeding ten percent of the net income before tax of the preceding year

S2: All private corporations in the Philippines shall be incorporated under the Corporation Code, which is a general law
A. Both are true
B. Both are false
C. Only S1 is true
D. Only S1 is false

Answer 1

Statement S1 regarding director compensation is subject to specific jurisdiction laws and corporate bylaws, while S2 is true as private corporations in the Philippines are indeed incorporated under the Corporation Code. The answer is likely C. Only S1 is true.

Step-by-step explanation:

The question pertains to the regulation of corporate governance and incorporation in the Philippines. The statements being analyzed involve compensation of directors and the requirement of corporations to be incorporated under the Corporation Code.

Regarding S1, directors are typically entitled to compensation, which may be stipulated by corporate bylaws and subject to regulatory and/or shareholder approval, but specifics can vary depending on jurisdiction and the corporation's governing documents. Therefore, this statement requires reference to the specific jurisdiction and corporate bylaws to verify its accuracy. As for S2, it is generally true that private corporations in the Philippines must be incorporated under the Corporation Code, as this is the prevailing general law governing corporation setup and management in the country.

In summary, the answer is likely C. Only S1 is true, presuming that the director compensation statement aligns with the specific provisions of the Philippine laws and corporate bylaws in question.