Explore three major financial statements, balance sheet, income statement, and cash flow statement, and learn how assets, liabilities, equity, revenues, expenses, and cash flows distinguish cash earnings from accounting earnings.

Trace the income statement format from revenues on an accrual basis, subtract cost of goods sold to reach gross profit, then deduct operating and financial expenses to net income.

Trace revenues to net income through key steps. Start with gross profit after cost of goods sold, subtract operating expenses to reach operating profit, then apply taxes to net income.

Discover how the income statement reveals the bottom line as revenue minus expenses, and classify expenses into operating, financing, and capital categories, including r&d.

Explore the corporate lifecycle and how income statements reveal the growth, profitability, and losses of young growth companies like Peladon, including R&D treatment as capital expenditure.

Analyze Coca-Cola's income statement as a mature, low-growth cash generator, contrasting its steady revenue with Netflix’s high growth, and note how COGS, SG&A, and brand-driven marketing shape profitability.

Analyze extraordinary items versus recurring costs on the income statement, covering one-time gains or losses, write-offs, goodwill impairment, and misclassified foreign currency, plus the long-term role of R&D expenses.

Compare Netflix’s balance sheet to Peladon, highlighting its large non-current content assets (franchises, movie deals and IP) and deferred revenue, and explain how assets balance with liabilities and stockholders’ equity.

Analyze Coca-Cola’s balance sheet to show a mature company with about 86 billion in assets and 26.9 billion in liabilities, highlighting current assets, goodwill, and treasury stock effects.

The cash flow statement shows where cash comes from and where it goes, detailing operating, investing, and financing activities and the net cash flow.

Explore Peladon's cash flows by operating, investing, and financing activities, noting depreciation and stock-based compensation as non-cash addbacks and changes in accounts receivables and inventories.

Explore Netflix's cash flow statement, detailing three sections—operating, investing, and financing activities—and how content spending drives negative operating cash flow, while debt issuance sustains cash levels.

Explain the positive and negative signs in the cash flow statement and analyze how changes in operating assets and liabilities affect non-cash working capital and cash flows.

Explains cash flow statements from the perspective of equity investors, detailing operating, investing, and financing activities, and how the capital structure evolves as the company matures.

Analyze financial statements from a finance perspective using key tools. Assess profitability, efficiency, assets and liabilities, and cash flows in real-world company statements.

Explore ratio analysis to compare company performance across time and peers, and master horizontal and vertical analysis to read financial statements as trends and benchmarks.

Explore profitability ratios by examining how revenues form the denominator and how you derive contribution profit, gross profit, operating profit, and net income.

Compute the contribution margin ratio by dividing contribution (sales minus variable costs) by revenue, and see how firms like Zoome achieve pure profits on each extra unit.

Compute the contribution margin ratio from revenue and variable costs, illustrating an 80 percent margin and 0.80 profit per dollar of sales.

The gross profit ratio, calculated as sales minus cost of goods sold, divided by sales, directly measures marginal profitability by showing how revenue flows into profits.

Explore the EBITDA margin ratio, a cash-flow measure of earnings before interest, taxes, depreciation, and amortization, to gauge a company’s cash generation per dollar of revenue and its borrowing power.

Compute EBITDA by starting with net profit and adding back taxes, interest, and depreciation. Demonstrate that a 55% EBITDA margin means every dollar of revenue yields 55 cents EBITDA.

Analyze the net profit margin ratio as net profit divided by revenues, per dollar of revenue, a measure of profitability to equity investors, while neglecting cash flow and extraordinary expenses.

Analyze Peladon’s income statement to calculate gross profit margin, operating profit margin, and net profit margin, noting the lack of fixed versus variable COGS and losses.

Explore coverage ratios, especially the interest coverage ratio, defined as operating income divided by interest expense, revealing how well a company can meet debt payments; higher ratios boost lender confidence.

Calculate coverage ratios using real-world examples: Balaton shows no interest expense, so no coverage ratio; Netflix, Coca-Cola, and Amazon reveal healthy coverage at 4.16x, 10.66x, and 9.9x.

Calculate long-term debt, equity, and capital to derive debt to equity and debt to capital ratios for Peladon, Netflix, and Coca-Cola, illustrating leverage and capital structure.