Item 1

Statement I : Outstanding shares are unissued and issued shares currently held by stockholders.

Statement II: If the company uses the journal entry method, issuance of share capital for cash should be recorded with a credit to Unissued Share Capital account.

Item 2

Statement I: In the case of no-par value share capital, legal capital is the aggregate stated value of shares issued and subscribed plus any excess over stated value.

Statement II: The purchase of treasury shares increases the number of shares issued but it reduces the number of shares outstanding.

TRUE OR FALSE