The gradebook can be found under Grades in your course. A gradebook contains your grading system, grade calculations, grade scheme, grade items, and view and display options. Grade items in your grade book represent all the work that you want to evaluate students on in a course. Each course start with an empty gradebook by default, unless you have copied the gradebook from another course. 

The grading system determines how the grade items in your grade book contribute to students’ final grades. 

There are three options:

• Grade items can count as a percentage of a final grade worth 100%.
• Grade items can be worth a certain amount of points that are totaled for a final grade.
• You can define a custom formula for how grade items contribute to a final grade.

At its simplest, anything that receives a grade is a Grade Item. For example a quiz, an assignment, a project, or even each question in the final exam. These are all examples of items. Students will see a grade for each item in their view.

Grade categories organize and group related grade items into sections in your gradebook, for example, a Writing Assignments grade category to group assignment items and a Class Participation grade category to group discussion items. 

A grade scheme is nothing more than a grading scale. It transforms point values to actual grades. Each point value has its own range of acceptable grades and a symbol, such as a numeric value, letter, or text description, to represent it. You can use the grade schemes that are already available or create your own grade schemes.