Understanding Financial Statements: Replaced


Overview/Description
Target Audience
Expected Duration
Lesson Objectives
Course Number


Overview/Description
This content is replaced by the course "Financial Statements" , Course ID: fin_01_a04_bs_enus. Organizations use financial statements to report their performance and their financial condition to investors and lenders. Managers--including nonfinancial managers--can use these statements to understand how the organization is doing: Are any changes needed? Can the organization improve? How quickly is the organization growing in comparison with its competitors? Are there any financial danger signs? This course provides a foundation for reading the three key financial statements prepared by most corporations--the balance sheet (or statement of financial condition), the income statement (or earnings statement, or profit and loss statement), and the statement of cash flows. The course also explores how to use basic ratios to analyze these financial statements.

Target Audience
Nonfinancial managers who seek a basic understanding of financial statements

Expected Duration (hours)
3.5

Lesson Objectives

The Balance Sheet

  • recognize the value of understanding a balance sheet.
  • identify examples of assets that appear on a balance sheet.
  • calculate the value of key categories of assets for a balance sheet, given hypothetical financial information.
  • select examples of the types of liabilities reported on a balance sheet.

    • Income and Cash Flow Statements

  • recognize the value of understanding the income statement and the statement of cash flows.
  • identify examples of the key elements for calculating gross profit on an income statement.
  • use the key elements to calculate the gross profit for a hypothetical organization.
  • select examples of the categories of cash from the activities reported on a cash flow statement.
  • calculate the amount of funds using hypothetical cash flow information.
  • match uses of funds with examples.

    • Analyzing Financial Ratios

  • recognize the benefits of using ratios to analyze financial statements.
  • match examples of ratio analyses to their purposes.
  • calculate the appropriate ratio analysis data needed to answer specific questions about financial conditions.
  • calculate return on equity, return on sales, and gross margin given hypothetical business and financial data

    • Course Number:
    FIN0154