Formulas, equations, and reactions
In studying chemistry, we represent the composition of a substance through the use of the chemical formula. The chemical formula of a given substance, represented by either a single uppercase letter or an uppercase letter followed by a lowercase letter, specifies the elements that the substance contains through the use of atomic symbols, and is sometimes marked with numerical subscripts that show the relative proportion of each element to the other elements in the substance.
Let's use the formula for magnesium chloride, MgCl2. If we interpret this, it shows us that for every one magnesium atom in the compound, there are two chlorine atoms (thus the subscript "2" attached to the Cl). Now consider the formula for carbon tetrachloride, CCl4. Once again, we interpret this as there being one carbon atom for every four chlorine atoms.
But now we need to look at the two main types of substances: ionic and molecular.
Ionic Substances and Ionic Nomenclature 
For more information, see Ionic bond
An ion is defined as an electrically charged particle that has acquired an overall (net) charge by losing or gaining electrons. One of the most familiar examples of an ionic substance (a substance composed of ions) is sodium chloride, NaCl, commonly known as "table salt".
Let's take copper for example: copper is normally found in a neutral state, meaning there are no extraneous electrons hanging around, nor does it need to gain any electrons to become neutral. However, in a reaction with hydrochloric acid, HCl, copper will normally lose an electron to chlorine when bonding to it, and become CuCl2, or copper(II) chloride.
In this process, copper has become a cation. A cation is an atom that has lost one or more electron(s) to become positive. We would denote this by showing coppers atomic symbol with a superscript denoting it's charge - Cu2+. This symbol shows that copper has lost two electrons to become positively charged. Other atoms, such as sodium in the case with sodium chloride, become Na+, denoting that it has lost one electron.
Yet in the same process with CuCl2, chlorine has gained one electron, making it an anion. An anion is an atom that has gained an extra electron to become negative.. This we denote with the atomic symbol for chlorine, and place a superscript "1-" or just "-", shown as Cl- or Cl1-.
So now it only seems logical that when you place cations and ions together (that will presumably react), you get what is called an ionic compound. You've already been shown two such compounds: NaCl and CuCl2.
Now let's discuss the formula unit. The formula unit is the group of atoms explicitly present in the compound. For example, NaCl denotes one Na atom for every Cl atom, nothing more, nothing less. The same goes with CaCl2, which denotes one Ca atom for every two Cl atoms. A formula unit is the smallest unit for each of these substances.
But how do we write these formulas? Simple enough. Take the reaction between Fe3+ and SO42-. When you place them together - assuming that they will, in fact, react - we take the superscripts and place them as subscripts. Here's a more visual example: