Why capital is listed under liability of balance sheet? Capital means investment made by the owner of the company isn't it. In that aspect investment will come under asset only. Then why its shown under liability of a balance sheet.

Expert Answers

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I believe that what is going on here is that the term capital is being used in a slightly different way than it is usually used in economics (like the way you use it in this question).

In the case of balance sheets, capital refers to debt obligations that firms have incurred in order to buy their capital goods.

So, in this case, capital is being used as another term for a loan, essentially.  It is a specific kind of a loan that is used for a specific purpose.  That purpose is to buy capital goods.

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