Air carrier pilot reported while holding short of the runway a small general aviation aircraft taxied around them and entered the runway with arrival traffic on short final. The reporter instructed the first aircraft on short final to go-around and Tower instructed the second aircraft on short final to go-around.

Narrative

We taxied to Runway XXR; via Taxiway '1' and held short of the Runway on the taxi line. This placed our aircraft at a 45-degree angle to the Runway with a view of final. There was [another carrier] on short final and another aircraft behind them. While stopped with the parking brake set; I caught movement out the left side window. A light twin-engine aircraft somehow had gone around our wing and was passing by our nose. They crossed the hold short line and headed towards the runway. I broadcast over Tower frequency 'Go-around! Go-around!'[The light twin-engine aircraft] came to a rocking stop about 25 ft. past the runway hold short line. [Aircraft on short final] immediately started a go-around and broadcast that on Tower frequency. The Tower then gave them missed approach instructions. I didn't know if the Tower could see what had happened from their location; so I said on Tower frequency '[light twin-engine aircraft] is across the hold line.' The Tower confirmed with [light twin-engine aircraft] that they were across the hold line and then told [second aircraft on final approach] to go around. After a few moments; the Tower instructed [light twin-engine aircraft] to taxi down the runway; exit at Taxiway '2' and enter the holding block. After the runway was clear; we were cleared for takeoff.