What is a Capital Stock Formula in Accounting? Owner's equity is equal to a company's total assets minus its total liabilities.It represents the potential capital available to use for a sole proprietorship. Your initial tax basis in an S corporation is what you paid or contributed to acquire your stock shares. Each provider participating in the. Tax forms and publications. How did we come up with these amounts? In accounting, capital stock is one part of the equity section on a balance sheet. ' Only corporations can sell capital stock to investors. Module 5: Accounting for Cash.