Need assistance with forms

I'm trying to insert prompts into a report to allow the user to customize the report to view the data
that they want to see. What exactly do I have to do to the report to make this possible?

You need to create a user parameter. You can do this in multiple ways:

when designing the query which will select the data for the report, include a bind variable, such as:

select * from instructor where id_no = :ID_PARAM

when you click next, you will be informed that the parameter :ID_PARAM was created for you. When you run the report, the user will be prompted for that value.

Another way to do it is to create the user parameter under the Data Model/User Parameters node, and then edit the query similar to what I described above.