Computer not appearing on

I have two computers (both XP Pro) as a small network. named PC1 and PC2. I
have shared a folder named ShareFolder inside PC1's My Documents.
ShareFolder's permissions are currently set to Everyone which lets me see
this folder on PC2's My Network Places.

But I want a specific permission set so that only PC2 can access this
folder, and not another PC which may be hooked to the network off and on.

When I go into Permissions for ShareFolder and click Add, all I see is the
current PC1 and not PC2. I clicked Locations, but even there only PC1 is
appearing. How can I make the permissions so that only PC2 can access
ShareFolders.

Thank you very much for your help.