Upon issuance, common stock is generally recorded at its fair value, which is typically the amount of proceeds received. Playtel uses the complete equity method to report its investment in San Jose on its own books.A reporting entity should recognize treasury stock based on the amount paid to repurchase its shares. What is a Capital Stock Formula in Accounting? Capitalization is an accounting method in which a cost is included in an asset's value and expensed over the asset's useful life. The ending balances of capital stock and retained earning are P93,750 and P37,500, respectively. It is now December 31, 2024, two years since the acquisition. Diversifying away from a concentrated stock position. •Converting stocks into cash. Capital stock is the amount of common and preferred shares that a company is authorized to issue, according to its corporate charter.