Prtnrap. Corpstock. Other - Page 5 25. Which of the following statements reflects the transferability of ownership rights in a corporation? a. If a shareholder decides to transfer ownership. he must transfer all of his shares b. A shareholder may dispose of part or all of his shares. e. A shareholder must obtain permission from the board of directors before selling shares d. A shareholder must obtain permission from at least three other stockholders before selling shares. 26. A typical organization chart showing delegation of authority would show a. stockholders delegating to the board of directors. b. the board of directors delegating to stockholders. e. the chief executive officer delegating to the board of directors. d. the controller delegating to the chief executive officer. 27. Which of the following statements concerning taxation is accurate? a. Partnerships pay state income taxes but not federal income taxes. b. Corporations pay federal income taxes but not state income taxes. c. Corporations pay federal and state income taxes. d. Only the owners must pay taxes on corporate income. 28. Which of the following statements is not considered a disadvantage of the corporate form of organization? a. Additional taxes b. Government regulations c. Limited liability of stockholders d. Separation of ownership and management 29. If an investment firm underwrites a stock issue, the a. risk of being unable to sell the shares stays with the issuing corporation b. corporation obtains cash immediately from the investment firm. c. investment firm has guaranteed profits on the sale of the stock. d. issuance of stock is likely to be directly to creditors. 5. Retained earnings a. is unique to the corporate form of business. b. is an optional account in the partnership form of business. c. reflects cash paid in by shareholders to date. d. is closed at the end of the year