# CATE Accounting Equation Lesson Plan

ACP Lesson Plan

Overview / Description: Students will learn the fundamental accounting equation and its importance to business transactions.

Learning goals/objectives:

To understand the fundamental accounting equation, which defines assets, liabilities and owner's equity, as it applies to the financial condition of an organization.

After completing this activity, students should be able to . . .

• Understand the components of the accounting equation (Assets, Liabilities, Owner’s Equity) and provide examples of each.

• Check the balance of the accounting equation after a business transaction has been analyzed and recorded.
• Solve the basic accounting equation for missing numbers.
• Define basic accounting terminology.

Content Standards:

AF1.a:Identify current structures and regulations affecting accounting principles and their effects on businesses.

AF1.a.4.h:Distinguish between the accrual basis of accounting and the cash basis of accounting and discuss the impact each has on financial statement

AF1.b:Analyze the effects of changes in assets

AF1.b.4.h:Journalize and post accounts receivable transaction

AF1.c:Analyze the effects of changes in liabilities

AF1.c.4.h:Journalize and post accounts payable transactions

AF1.d:Analyze the effects of changes in owner’s equity.

AF1.d.6.h:Demonstrate appropriate accounting techniques used to account for investments and withdrawals by owners

Materials:

Textbook: Glencoe Accounting, by Guerrieri, Haber, Hoyt and Turner, McGraw Hill, ISBN:978-002-140088-1

YouTube Video – Accounting Equation Explained:

PowerPoint: Accounting Equation Overview:

Handouts:

End of unit quiz:

Assessment:

• Group work on terms and accounting questions.
• Balance the worksheet assignment.
• Complete the transaction worksheet assignment.
• Accounting terms quiz.

Wrap-Up: This is an in depth overview of the fundamental accounting equation, which sets a solid foundation for a high school accounting course.

Extension Activity (for intervention or enrichment):

ATTACHMENTS Attachments listed above.