Samples can be stored as bits a couple of different ways. One way is to consider all the states as positive, with no values below zero. As shown in the figure above, the states 00, 01, 10, and 11 are the same as the positive numbers 0, 1, 2 and 3. This eliminates the need for a negative sign. Such samples are called unsigned. For 8 bit samples, the states would range from 0 to 255.

The other way is to use a form known as two's complement, which allows both positive and negative values. These samples are called signed. Since real world waveforms tend to fluctuate through a range of positive and negative values, signed samples are preferred. For 16 bit samples, the states would range from -32678 to 32767.