I've seen kids start kindergarten already reading chapter books, and I've seen kids walk through the door knowing almost zilch, academics-wise: no letters, numbers, letter sounds, colors, or shapes. Both of these types of kids, and all the kids in between, can absolutely succeed in school.
The main factor--bigger than what they know coming in--is how they feel about learning. Confident, motivated kids who enjoy learning almost invariably fare better in the long run than kids who decide early on that school is boring, learning is hard, and reading is a punishment worse than broccoli.
So, sending a kid to school already knowing a few things, and feeling excited about learning more, can absolutely be a plus. The key is to keep it simple, casual, and fun. I like to call this "Instruction Incognito"--sneaking teachy-learny stuff into every day activities.
When teaching your child to recognize something new (whether it be a letter, number, color, or shape), sneak it into your reading time together by following these steps:
1) Introduce it: Point to a picture. "See this color? That's called red. Here's a red truck...and this is a red hat. Hey, check out this red kite!" Continue reading, pointing out examples once in a while, keeping your tone fun and casual.
2) See if your child can point to it, given just 2 or 3 choices: "Can you find something red on this page?" If yes, high fives and smiles! If not, continue to point out some more examples occasionally as you read: "Oooh, and here's a red fish..."
3) Once your child can point to it, move to naming it: "I bet you know what color this cup is!"
4) When your child starts to master it, don't be surprised if s/he starts recognizing examples everywhere! "Hey, Mom, that car is red! And Dad's shirt is red!..."
CAUTION: Storytime is a great teaching opportunity that can go horribly wrong if you get too caught up in turning every page into a lesson! Remember, it's Instruction Incognito--just sneak it in here and there.
Ideas and Resources
Click here for a list on Amazon of books that teach colors.
Click here for a TON of ideas on teaching shapes (and other preschool concepts).
Click here for my list of Ideas on Teaching Letters.