King uses the Equity Method of Accounting for Investments in Common Stock. Capital Stock Accounting: Capital stock is included in the balance sheet as a portion of the company's equity.Stockholders' equity is the remaining amount of assets available to shareholders after paying liabilities. Learn how to calculate stockholders' equity. Stockholders' equity equals assets minus liabilities, framing investor stake after creditors. Paid-in capital includes monies from stock sales. Capital stock is the amount of common and preferred shares that a company is authorized to issue, according to its corporate charter. Share capital means the owners' claim over the net assets. The balance sheet have two sides; assets side and Liabilities and equity side. We'll delve into the purpose of creating balance sheets (also known as net worth statements) and then provide a stepbystep guide of how to make your own.