Investment in stocks normal balance
Common stock is that amount which invest by third party investors in business and a capital for business and liability for business and like all other liabilities shown under liabilities section of balance sheet it is also shown under liabilities section of balance sheet and not in income statement. Investment of Stocks in Other Corporations When a corporation purchases the stock of another corporation, the method of accounting for the stock investment depends on the corporation’s motivation for making the investment and the relative size of the investment.