If your student applies to Florida State, you will see firsthand how colleges break down transcripts in a systematic manner as you have to fill out an SSAR - a self-reported academic record. Courses are entered in a very specific and systematized manner with grades entered for each semester. You have to use specific slots in the form for each course. As you complete the form, it is readily apparent how this normalizes all transcripts into a level playing field.
The “very selective” and “extremely selective” colleges usually recompute their own version of GPA using only “core” academic classes: math, science, English, social studies, and foreign language. They may also apply a weighting factor based on their perception of the academic rigor of specific high school programs.