Capital stock is the number of common and preferred shares that a company is authorized to issue, and is recorded in shareholders' equity. BA 6005 is an introductory finance course for new business students.The cost of capital for a company is the opportunity cost for investors in the setting of a diversified portfolio. Capital stock are equity holders in the company. EconPapers provides access to the largest collection of online Economics working papers and journal articles. Capital includes the physical assets (i.e. , plant and equipment) used in the production of commodities.