Title: Understanding Property, Plant, and Equipment in Accounting

Grade Level: 10th Grade

Subject: Accounting

Duration: 2 class periods (90 minutes each)

Objectives: 1. Understand the concept of Property, Plant, and Equipment (PPE) in accounting. 2. Identify different types of PPE and their characteristics. 3. Learn how to record and calculate depreciation for PPE. 4. Analyze the impact of PPE on financial statements.

Materials: - Whiteboard and markers - Handouts with examples of PPE - Calculators - Computers with accounting software (optional)

Procedure:

Day 1:

Introduction (10 minutes): 1. Begin the lesson by asking students if they are familiar with the term “Property, Plant, and Equipment” and what it means to them. 2. Explain that PPE refers to long-term tangible assets used in the production or supply of goods and services, such as buildings, machinery, vehicles, and land. 3. Discuss the importance of understanding PPE in accounting and how it affects financial statements.

Types of PPE (20 minutes): 1. Present a list of different types of PPE on the whiteboard. 2. Discuss each type of PPE, its characteristics, and its importance in various industries. 3. Provide examples and real-life scenarios to help students understand the practical application of PPE.

Recording PPE (30 minutes): 1. Explain the process of recording PPE in accounting books. 2. Discuss the concept of cost, including the purchase price, transportation costs, installation costs, and any other costs necessary to bring the asset into its working condition. 3. Demonstrate how to record the acquisition of PPE using journal entries. 4. Provide handouts with examples of journal entries for students to practice recording PPE transactions.

Day 2:

Depreciation of PPE (30 minutes): 1. Introduce the concept of depreciation and its importance in accounting. 2. Explain different methods of calculating depreciation, such as straight-line, reducing balance, and units of production. 3. Discuss the factors that influence the choice of depreciation method. 4. Provide examples and calculations for each depreciation method. 5. Allow students to practice calculating depreciation using the provided examples.

Impact on Financial Statements (20 minutes): 1. Discuss how PPE affects the balance sheet, income statement, and cash flow statement. 2. Explain how the acquisition and depreciation of PPE impact the financial statements. 3. Analyze the effect of PPE on profitability, liquidity, and solvency ratios. 4. Provide examples and ask students to identify the impact of PPE on financial statements.

Conclusion (10 minutes): 1. Recap the main points discussed during the lesson. 2. Address any questions or concerns raised by the students. 3. Assign homework that involves analyzing the impact of PPE on financial statements of a given company.

Assessment: 1. Monitor students’ participation and engagement during class discussions and activities. 2. Review students’ completed journal entries and calculations for accuracy. 3. Evaluate students’ understanding of the impact of PPE on financial statements through class discussions and homework assignments.