How to Read Financial Statements: Build Financial Literacy.

In this module you will be able to

• Locate Whole Foods’ annual report at their website
• Locate Whole Foods’ their balance sheet within the annual report.
• Relate some interesting details about the company and its founder
• Explain the important line items for assets, liabilities and equity on a balance sheet.

In this module you will be able to

• Locate Whole Foods’ statement of operations (income statement) in its annual report
• Explain what are the important elements of revenues and expenses for a statement of operations
• Explain what is earnings per share
• Explain how the statement of operations relates to retained earnings on the balance sheet.

In this module you will be able to

• Locate Whole Foods’ statement of cash flows in its annual report
• Explain what are the important elements of operating, investing, and financing activities on a statement of cash flows
• Explain how the statement of cash flows relates to cash on the balance sheet.

In this module, you will be able to

• Explain who are the six most important stakeholders of a corporation (employees, customers, government, vendors, lenders, investors)
• Explain what are the give and take of a transaction
• Explain how accounting records the give and take for transactions with the six stakeholders
• Explain which side of the give and take appears on the income statement and on the statement of cash flows.

In this module, you will be able to

• Explain why you can’t measure profit with cash
• Explain why you need to use accrual accounting (double-entry accounting), not cash accounting.

In this module you will be able to

• Illustrate how accrual accounting can both record cash and profits using a spreadsheet
• Explain the basis for bookkeeping and basic accounting without learning bookkeeping
• Explain how each side of a transaction with a stakeholder can be recorded separately from the other

In this module, you will be able to

• Locate Sherwin Williams’ annual report from its website
• Locate the balance sheet in the annual report
• Relate some important details about the company’s business
• Explain what each line item of the balance sheet means
• Distinguish between current assets, non-current assets, current liabilities, non-current liabilities, and shareholders’ equity.

In this module, you will be able to

• Locate Sherwin Williams’ income statement from its annual report
• Explain what each line item of the income statement means, including revenues, expenses, and earnings per share.

In this module you will be able to

• Locate the statement of cash flows for Sherwin Williams from its annual report
• Explain each important line item for the three sections of the statement: operating activities, investing activities, and financing activities.
• Explain how the format of the operating activities section differs from the other two activities (investing and financing)

In this module you will be able

Test the knowledge you have acquired so far by completing 28 multiple-choice questions about the 2013 Facebook annual report presented in quiz format.

In this module you will be able to

• Explain four areas that can go wrong in a business (sales pricing, expense control, asset management, and asset financing)
• Explain how four ratios (return on equity, profit margin, asset turnover, and financial leverage) can detect problems within the four potential problem areas.

In this module you will be able to

• Compute return on equity ratio from Sherwin Williams’ financial statements
• Explain how to drill down into three component ratios (profit margin, asset turnover, and financial leverage) to pinpoint problem areas.

In this module you will be able to

• Compute the profit margin for Sherwin Williams from its financial statements

• Drill down and compute the gross profit percentage and expense percentage from its financial statements. 

• Locate management’s explanation for year-to-year changes from the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of the annual report.

In this module you will be able to

• Compute the asset turnover for Sherwin Williams.
• Locate management’s explanation for year-to-year changes from the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of the annual report.

In this module you will be able to

• Compute the financial leverage for Sherwin Williams
• Locate management’s explanation for year-to-year changes from the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of the annual report.
• Summarize the key reasons for return on equity variations for Sherwin Williams from year-to-year

In this module you will be able to

• Explain how four industries (distribution, manufacturing, service, and financial services differ in the way they make money
• Explain how the profit margin, asset turnover, and financial leverage ratios can reveal the key differences in the way that four industries make money

Discover why understanding financial statements is more valuable than ever in the age of AI. Learn what AI does well, where it falls short, and why financial literacy remains essential for making informed business and investment decisions.

Learn how to upload an annual report into ChatGPT and ask questions that produce meaningful financial insights. You'll discover how better prompts help AI explain a company's business, strengths, risks, and financial performance in plain English.

Learn how to use AI to analyze financial ratios using the DuPont framework. Discover how AI can explain Return on Equity, Profit Margin, Asset Turnover, and Financial Leverage in plain English while helping you connect the numbers to a company's business performance.

Learn how to use AI to compare companies using the DuPont framework. You'll analyze profitability, efficiency, and financial leverage to identify strengths, weaknesses, and competitive advantages that can help you make better business and investment decisions.

Learn to recognize the most common AI mistakes—including hallucinations, incorrect calculations, missing context, and overconfidence. Discover how financial literacy helps you verify AI's conclusions and use AI as a powerful assistant rather than a substitute for sound judgment.

Bring everything together by building your own Personal Financial Analysis Assistant. You'll learn a practical workflow for analyzing companies, receive a downloadable AI Prompt Pack, and discover how to combine financial literacy with AI to make better business and investment decisions.

What if you had a personal finance tutor available 24/7? In this lecture, you'll learn how to use AI to create a personalized learning experience tailored to your goals and current knowledge. You'll see how AI can explain concepts, answer questions, generate examples and quizzes, and help you build financial confidence while remaining in control of your learning.