 Welcome to Unit 3 of Sailor.org's Introduction to Financial Accounting. This unit is divided into five subunits and should take about two and a half hours to complete. Earlier this course, you learned that balance sheets, income statements, statements of cash flows and statements of shareholders' equity are all forms of financial statements. You also learned how to record business transactions appropriately. In this unit, you will take that knowledge one step further and learn how to prepare each of these financial statements using information you can gather from a company's everyday business transactions. We'll learn the specifics, for example, of what we call 10Qs and 10Ks. 10Qs are quarterly financial statements, and 10Ks are the annual financial statements. Companies like Starbucks, Nike, or Johnson & Johnson have for the public and their investors. Can you imagine the time and attention to detail that accountants at these companies have to use to prepare these statements? Or can you imagine what would happen if an error were made? Accounting can be a serious business. At the end of this unit, you should know all the basic components of a financial statement. You should also be able to take a look at a company's annual report and identify the different types of financial statements it includes. You're doing great. You've already tackled some of the most difficult concepts of financial accounting, so you should be proud of yourself. Now for the rest of the course, we're going to take a look at these concepts in greater detail and with an eye towards real-world applications. So good luck.