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Tally Notes
1
Basic Accounting
Basic concept of accounting
Introduction
Accounting is a process of identifying, recording, summarizing and reporting economic information
to decision makers in the form of financial statements. Financial statements will be useful to the
following parties:
Suppliers
Customers
Employees
Banks
Suppliers of equipments, buildings and other assets
Lenders
Owners
Types of Accounts
There are basically three types of Accounts maintained for transactions :
Real Accounts
Personal Accounts
Nominal Accounts
Real Accounts
Real Accounts are Accounts relating to properties and assets, which are owned by the business
concern. Real accounts include tangible and intangible accounts. For example,
Land
Building
Goodwill
Purchases
Cash
Personal Accounts
Personal Accounts are Accounts which relate to persons. Personal Accounts include the following.
Suppliers
Customers
Lenders
Nominal accounts
Nominal Accounts are Accounts which relate to incomes and expenses and gains and losses of a
business concern. For example,
Salary Account
Dividend Account
Sales
Accounts can be broadly classified under the following four groups.
Assets
Liabilities
Tally Notes
2
Income
Expenses
The above classification is the basis for generating various financial statements viz., Balance Sheet,
Profit & Loss A/c and other MIS reports. The Assets and liabilities are taken to Balance sheet and the
Income and Expenses accounts are posted to Profit and Loss Account.
Golden Rules of Accounting
Real Accounts Personal Accounts Nominal Accounts
Debt What Comes in The Receiver Expenses and Losses
Credit What Goes out The Giver Incomes and Gains
Business transaction: A business transaction is “The movement of money and money’s worth from
one person to another”. Or exchange of values between two parties is also known as “Business
Transaction”.
Purchase: A purchase means goods purchased by a businessman from suppliers.
Sales: Sales is goods sold by a businessman to his customers.
Purchase Return or Rejection in or Outward Invoice: Purchase return means the return of the full or
a part of goods purchased by the businessman to his suppliers.
Sales Return or Rejection out or Inward Invoice: Sales return means the return of the full or a part of
the goods sold by the customer to the businessman.
Assets: Assets are the things and properties possessed by a businessman not for resale but for the
use in the business.
Liabilities: All the amounts payable by a business concern to outsiders are called liabilities.
Capital: Capital is the amount invested for starting a business by a person.
Debtors: Debtor is the person who owes amounts to the businessman.
Creditor: Creditor is the person to whom amounts are owed by the businessman.
Debit: The receiving aspect of a transaction is called debit or Dr.
Credit: The giving aspect of a transaction is called credit or Cr.
Drawings: Drawings are the amounts withdrawn (taken back) by the businessman from his business
for his personal, private and domestic purpose. Drawings may be made in the form cash, goods and
assets of the business.
Receipts: It is a document issued by the receiver of cash to the giver of cash acknowledging the cash
received voucher.
Tally Notes
3
Account: Account is a summarized record of all the transactions relating to every person, every thing
or property and every type of service.
Ledger: The book of final entry where accounts lie.
Journal entries: A daily record of transaction.
Trail Balance: It is a statement of all the ledger account balances prepared at the end of particular
period to verify the accuracy of the entries made in books of accounts.
Profit: Excess of credit side over debit side.
Profit and loss account: It is prepared to ascertain actual profit or loss of the business.
Balance Sheet: To ascertain the financial position of the business. It is a statement of assets and
liabilities.
Journals Journal entry is an entry to the journal. Journal is a record that keeps accounting transactions in
chronological order, i.e. as they occur. Ledger is a record that keeps accounting transactions by
accounts. Account is a unit to record and summarize accounting transactions.
When a small business makes a financial transaction, they make a journal entry in their accounting
journal in order to record that transaction. The transaction is recorded in the general journal or one
of the special journals for the most active accounts. The most common special journals are the Sales
Journal, the Purchases Journal, the Cash Receipts Journal, and the Cash Disbursements Journal.
An accounting journal is a detailed record of the financial transactions of the business.
The transactions are listed in chronological order, by amount, by accounts that are affected, and in
what direction those accounts are affected. Depending on the size and complexity of the business, a
reference number can be assigned to each transaction and a note may be attached explaining the
transaction.
The accounting journal is the place where the details lie. The general ledger is where you look for the
big picture. A sample accounting journal page has columns for the date, the account, the amount of
the debit, and the amount of the credit.
Tally Notes
4
Journal Entries Examples 1. Cash brought in by proprietor as capital Rs. 30000 a) What comes in business will be debited Cash has come in business; cash account will be debited in journal entry. b) Who is giver will be credited Proprietor is giver of cash to business but he has business motive and he gives the money to business as capital. Journal Entry Cash Account Debit 30, 000 Proprietor’s capital Account Credit 30,000 2. Goods purchased on credit from Madan Lal Rs. 5,000 a) What comes in business will be debited Goods have come in business, so its financial value will be debited with the name of purchase account. b) Name of person is given from whom we bought the goods on credit, so Ist rule’s second part will be applied. Who is giver, will be credited. Madan lal is giver, so its account will be credited. Purchase account debit 5000 Madan Lal account credit 5000 3. Furniture purchased for cash Rs. 10000 a) What comes in business will be debited. In this transaction, furniture came in business, so we will open furniture account in the debit side of journal entry. b) Cash is also asset and we paid for
purchasing of furniture. 2nd rule’s second part will be applied. Furniture Account Debit 10,000 Cash Account Credit 10,000 4. Goods sold on credit to Dev Raj Rs. 1600 a) Dev Raj is receiver of goods, so his personal account will be debited. b) Goods go out, so, goods or sale account will be credited. Dev Raj Account Debit 1600 Sale Account Credit 1600 5. Goods purchased for cash Rs. 4500 a) Goods come in, so goods or purchase account will be debited b) Cash goes out, so cash account will be credited. Purchase account debit 4500 Cash account credit 4500 6. Goods sold for cash Rs. 2100 a) Cash comes in, so cash account will be debited. b) Goods go out, so goods or sale account will be credited. Cash account debit 2100 Sale account credit 2100 7. Rent paid for shop to landlord 3000 a) Rent is an item of expenses, so it will be debited. b) Cash is an item of asset and it goes out, so it will be credited.
Tally Notes
5
Rent Account Debit 3000 Cash Account Credit 3000 8. Commission received in cash 2000 a) Cash comes in, so cash account will be debited. b) Commission is an item of income, so commission account will be credited. Cash Account Debit 2000 Commission Account Credit 2000 9. Cash deposited into bank 5000 a) Bank is receiver of cash, so bank account will be debited. b) Cash goes out, so cash account will be credited. Bank Account Debit 5000 Cash Account Credit 5000 10. Cash withdrawn from bank for office use Rs. 2000 a) Cash comes in the business, so cash account will be debited. b) Bank is the giver, so bank account will be credited. Cash Account Debit 2000 Bank Account Credit 2000 11. Cash drawn by proprietor from business for personal use Rs. 3000 a) Proprietor is the receiver of cash, but business will give him as drawing which is decrease in his capital, so proprietor’s drawing account will be debited. b) Cash goes out, so cash account will be credited.
Drawing Account Debit 3000 Cash Account Credit 3000 12. Goods given as charity Rs. 1000 a) Charity is an expense of business, so it will be debited. b) Goods go out, so goods or purchase account will be credited. Charity Account Debit 1000 Purchase Account Credit 1000 13. Bad Debts written off Rs. 500 a) Bad debt is loss of business due to not paying the amount by our debtors, so it will be debited. b) There is decrease in debtor. We are applying what goes from business, debtor is also our asset, if he does not pay, and it means this asset has gone from business, so its account will be credited. Bad Debt Account Debit 500 Debtor Account Credit 500 14. Bad debts recovered in cash Rs. 300 a) Cash comes in, so cash account will be debited. b) Bad debts recovered are an income, so its account will be credited. Cash Account Debit 300 Bad Debts Recovered Account Credit 300 15. Carriage paid on machinery ( expenses on purchase of asset ) Rs. 1000 a) Carriage on purchase of machinery is part of cost of machinery, so machinery account will be debited. b) Cash goes out, so cash account will be credited.
Tally Notes
6
Machinery Account Debit 1000 Cash Account Credit 1000 16. Depreciation on fixed assets Rs. 500 a) Depreciation on fixed assets is the loss of business, and every loss will be debited. b) There is a decrease in asset and we will apply what goes from business on it. So, asset account will be credited. Depreciation Account Debit 500 Fixed Asset Account Credit 500 17. Carriage paid on the behalf of buyer Rs. 1000 a) This is not our expenses, but this is increase our current asset and its name is debtor, so we will apply what comes in rule on it. b) Cash goes out, so cash account will be credited. Debtor account Debit 1000 Cash Account Credit 1000 18. Goods given as free samples Rs. 1500 a) Goods are given for advertising, advertising is an expense of business, and so advertising account will be debited. b) Goods go out at the cost price, so goods or purchase account will be credited. Advertising Account Debit 1500 Purchase Account Credit 1500 19. Interest allowed on capital Rs. 600 a) Interest is an expense of business, so it will be debited. b) There is an increase in the amount of capital. Capital is liability account, so increase in the amount of capital will be also shown in the credit side of journal entry.
Interest on capital Account Debit 600 Capital Account Credit 600 20. Interest charged on drawings Rs. 500 a) Decrease in capital or increase in drawing will be debited. b) Interest on drawing is an income of business. Drawing Account Debit 500 Interest on drawing account Credit 500 21. Bank charges or interest charged by bank Rs. 200 a) Bank charges are the expenditures of business, so it will be debited. b) There is decrease in bank balance, so bank account will be credited. Bank charge Account Debit 200 Bank account Credit 200 22. Goods lost by fire Rs. 800 a) Goods lost by fire are the loss of business, so loss by fire account will be debited. b) There is decrease in goods or stock at cost, so purchase account will be credited. Loss by Fire Account Debit 800 Purchase Account Credit 800 23. Goods insured and a claim is admitted by insurance company in full or in part. a) Insurance company will be our debtor. Transaction has increase in debtors because we have to get money from insurance company. So, this account will be debited. b) Decrease in loss by fire, so this account will be credited.
Tally Notes
7
Insurance company Account Debit XXXX Loss by Fire Account Credit XXXX 24. Loan taken Rs. 1,00,000 a) Cash comes in, so cash account will be debited. b) Lender is giver, so his loan account will be credited. Cash Account Debit 1, 00,000 Lender’s loan Account Credit 1,00,000 25. Interest paid on loan. Rs. 1000 a) Interest is an expense of business, so it will be debited. b) Cash goes out, so it will be credited. Interest on loan Account Debit 1000 Cash Account Credit 1000 26. Interest on loan due but not paid in cash. Rs. 500 a) Interest is an expense of business, so it will be debited. b) Increase in creditors will be credited in journal entry. Interest on loan Account Debit 500 Loan or Creditor Account 500 27. Investment purchased Rs. 50,000 a) Asset in the form of investment comes in, so investment account will be debited. b) Cash goes out, so its account will be credited. Investment Account Debit 50000
Cash Account Credit 50000 28. Cash stolen from office. Rs. 6000 a) Cash stolen from office is loss of business, so this account will be debited. b) Cash goes out, so its account will be credited. Loss by Theft Account Debit 6000 Cash Account Credit 6000 29. Cash paid to a creditor in full settlement ( When cash discount is received) Amount due to Madan Lal Rs. 5000 paid him Rs. 4950 in full settlement. a) Decrease in creditors = Debit b) Decrease in cash = Credit c) Discount received is income of business = credit Madan Lal Account Debit 5000 Cash Account Credit 4950 Discount Received Account Credit 50 30. Cash received from a debtor in full settlement (When cash discount is allowed). Amount receivable from Dev Raj Rs. 1600, received from him Rs. 1570. a) Increase in cash = Debit b) Discount allowed is the loss of business = Debit c) Decrease in debtors = credit Cash Account Debit 1570 Discount Allowed Account Debit 30 Dev Raj Account Credit 1600
Tally Notes
8
Introduction to Tally
Tally is a Financial and Inventory Management System. Tally is one of the acclaimed Accounting
Software with large user base in India and abroad, which is continuously growing. Tally is developed
in India using Tally Development Language (TDL).
Features of Tally
1. Accounting without codes
2. Comprehensive accounting. Maintains complete range of books of Accounts, Final Accounts
like Balance Sheet, Profit and Loss Accounts, Cash and fund flow, Trial Balance and others.
3. Provide multiple reports in diverse format.
4. Various options for interest calculations.
5. Maintain multiple Godowns for Stock Management.
6. Unlimited sub-classifications to get multi-dimensional analysis and comparatives.
7. Allow accounts of multiple companies simultaneously.
8. Multiple currencies in the same transaction and viewing all reports in one or more currency.
9. Prints online.
10. Print Daybook, Balance Sheet, Ledger, Trial Balance, Profit and Loss Accounts.
11. Backup and restore options.
12. Tally is allowed to print cheques.
13. Multiple tax calculations like VAT, TDS, TCS, FBT etc.
14. Payroll Calculations.
15. Use security levels for audit purpose.
Company Creation
From the Gateway of Tally click on F3: Cmp Info from the right side panel or press ALT+F3. From the Company Info, click on “Create Company”
Enter the following fields
Directory Specify the path where the company file should be stored in your computer. By default
C:\Tally\Data is the path taken
Name Enter your company name
Mailing Name Enter your company name for mailing purpose
Address Enter Company address
This address will display all your tally printout statement
Statutory compliance for
Select the country in which your business exists. It is used for tax calculation for country
wise
State Select your state
PIN Code Enter your company area PIN Code
Tally Notes
9
Telephone Enter your company phone number
Email Enter company E-Mail ID
Currency Symbol Rs. for Indian Rupee , USD for US dollars etc.
Maintain
Select Accounts only or Accounts with Inventory
Note: If your company is a Manufacture Company, you may select Accounts only. If your
company is trading company / Involve Inventory, you may select Accounts with
Inventory
Financial Year from
Enter your company starting financial year
In accountancy financial year starts from April 1st of the year to March 31st of the next
year. Suppose you may be starting company on September 01 - 2010, you should enter
the financial year from as 01-04-2010.
Books beginning from
Specify the date in which the book should be started. The date given must lie in between
the financial year starting date and ending date
Tally Vault Password
If you don't want to show your company name in company lists, enter and re-enter your
password (If you use this option, you can’t see your company name in the companies.
Tally shows your company name as ********)
USE Security Control If you need high security for your Tally company data, Enter Yes, then enter ‘Name of the
Administrator’ and ‘Password’. If you don’t need simply enter No.
Base currency symbol
This option specifies the information about currency used in the company such as Base
Currency Symbol, Formal Name, Number of decimal places, Is symbol suffix with amount,
symbol for decimal portion, show amount in Millions etc.
Ignore remaining fields and save.
Meaning of Ledger
Ledger in tally Classification of similar transactions under a particular head is known as Ledger. Here in tally, ledger is an accounting head, which is used to enter a transaction and also to identify the same in the reports. Cash account and profit & loss account are the two predefined ledgers available in tally. The other required ledgers can be created by the user. All the ledger are classified under the various groups. The user has to identify the ledger and create it under the appropriate accounting group. For example: Rent paid by cash, Rent account is debited and cash account is credited. In this transaction, there are two ledger account viz., Rent account and Cash account. In book keeping all the ledger accounts are primarily classified under four heads namely assets, liabilities, expenses and incomes. In tally, accounting ledgers can be created using accounts information menu which is available in Gateway of Tally. An accounting ledger can also be displayed or altered using accounts information menu. “Create” helps to create a new ledger, “Display” to view a ledger which is existing already but need not be modified. “Alter” helps to make changes in an existing ledger account. Ledgers can be deleted in the alteration menu by using the short cut key 'ALT+D', but deletion of a ledger is not possible if transactions have been recorded in it. Every ledger should be unique in its nomenclature; else Tally gives duplication warning and also will not accept the ledger creation.
Tally Notes
10
A ledger is an accounting book that facilitates the transfer of all journal entries in a chronological sequence to individual accounts. The process of recording journal entries into the ledger is called posting.
Type of Ledger Collect information from
General Ledger
The general ledger accumulates information from journals. Each month all journals are totaled and posted to the General Ledger. The purpose of the General Ledger is therefore to organize and summaries the individual transactions listed in all the journals.
Debtors Ledger
The Debtors Ledger accumulates information from the sales journal. The purpose of the Debtors Ledger is to provide knowledge about which customers owe money to the business, and how much. More information on Debtors Ledger
Creditors Ledger
The Creditors Ledger accumulates information from the purchases journal. The purpose of the Creditors Ledger is to provide knowledge about which suppliers the business owes money, and how much.
Example for Ledgers
Ledger Account Classification of Accounts (Groups) Accounting Nature
ABC’s Capital Account Capital Account Liability
Salary Payable Current Liabilities Liability
City Bank Account Bank Account Assets
Computers Fixed Asset Assets
Rent Indirect Expenses Expenses
Wages Direct Expenses Expenses
Bank Interest (Received) Indirect Income Income
Accounts Name Groups
Accrued Income Current Assets
Accrued Rent/ Accrued Income Current Assets
Advertisement Expenses Indirect Expenses
Advertisement Payable Current Liabilities
Air Conditioner Fixed Assets
Apprentice Premium Direct Incomes
Audit Fees Indirect Expenses
Bad Debts Indirect Expenses
Bad Debts Received Indirect Incomes
Bad Debts Reserve (last year balance) Indirect Incomes
Bank Bank Account
Bank Balance Bank Account
Bank Charges Indirect Expenses
Bank Commission Indirect Expenses
Bank Loan Loans & Liabilities
Bank Overdraft Bank OD
Bills Payable Current Liabilities
Bills Receivable Current Assets
Bombay Branch Branch & Division
Bonds Current Assets
Tally Notes
11
Building Fixed Assets
Capital Capital Account
Car Fixed Assets
Car Expenses Indirect Expenses
Car Repair Indirect Expenses
Carriage Direct Expenses
Carriage on Sales Indirect Expenses
Cash Cash in Hand
Cash at Bank Bank Account
Closing Stock Stock in Hand
Coal & Fuel Direct Expenses
Coal, Gas & Water of Factory Direct Expenses
Coffee Expenses Indirect Expenses
Coke Expenses Indirect Expenses
Commission (Cr.) / Commission Received Indirect Incomes
Commission (Dr.) Indirect Expenses
Computer Fixed Assets
Consignment Stock Current Assets
Consumed Material Direct Expenses
Coolage Direct Expenses
Creditors Sundry Creditors
Debtors Sundry Debtors
Deferred Expenses Current Assets
Deferred Income Current Liabilities
Delhi Branch Branch & Division
Depreciation Indirect Expenses
Depreciation Reserve Current Liabilities
Difference in Trial Balance (Dr or Cr) Suspense Account
Discount (Cr.) / Discount Received Indirect Incomes
Discount (Dr) / Discount Allowed Indirect Expenses
Donation Indirect Expenses
Drawing Capital Account
Electricity Expenses Indirect Expenses
Expenses on Purchases Direct Expenses
Expenses on Sales Indirect Expenses
Export Duty Indirect Expenses
Factory Fixed Assets
Factory Expenses (Lighting, Power etc.) Direct Expenses
Factory Incomes Direct Incomes
Farm House Fixed Assets
FDR Current Assets
Fire Insurance Indirect Expenses
Fitting Charges Received Indirect Income
Forex Gain Loss Indirect Expenses
Freight Direct Expenses
Freight Inward Direct Expenses
Freight on Purchase (Freight Inward) Direct Expenses
Tally Notes
12
Freight on Sale (Freight Outward) Indirect Expenses
Freight Outward Indirect Expenses
Fuel & Power of Factory Direct Expenses
Furniture & Fitting Fixed Assets
Furniture & Fixture Fixed Assets
Gas and Water Direct Expenses
General Expenses Indirect Expenses
General Reserve Current Liabilities
Godown Rent Indirect Expenses
Goods Sent on Consignment Sales Account
Goodwill Fixed Assets
Horse & Carts Fixed Assets
House Rent Capital Account
Hundi (Assets) Current Assets
Hundi (Liability) Current Liabilities
Import Duty Direct Expenses
Income From Repair Indirect Incomes
Income on Assets Indirect Incomes
Income on Investments Indirect Incomes
Income Tax Capital Account
Input VAT 4%, 12.5% Duties & Taxes
Insurance Indirect Expenses
Insurance Claim Indirect Incomes
Insurance Company Sundry Debtors
Interest (Dr.) Indirect Expenses
Interest on Capital Indirect Expenses
Interest on Drawing Indirect Incomes
Interest on Loan Indirect Expenses
Interest Received (Cr.) Indirect Incomes
Invest in Govt. Bond Investment
Investment Investment
Labour Charges Indirect Expenses
Land & Building Fixed Assets
Lease Hold Building Fixed Assets
Legal Expenses Indirect Expenses
LIC Premium (Dr) Capital Account
LIC Refund (Cr) Capital Account
Life Insurance Capital Account
Loan on Mortgage, Loans Loans & Liabilities
Loose Tools Fixed Assets
Loss By Damage Indirect Expenses
Loss by Fire Indirect Expenses
Loss in Transit Indirect Expenses
Loss on Assets Indirect Expenses
Loss on Joint Venture Indirect Expenses
Machine & Tools Fixed Assets
Machine Repair Indirect Expenses
Tally Notes
13
Manager’s Commission Indirect Expenses
Manufacturing Expenses Direct Expenses
Master Plus Investment
Miscellaneous Expenses Indirect Expenses
Miscellaneous Income Indirect Incomes
Motor Cycle Fixed Assets
Motor Cycle Repair Indirect Expenses
Mutual Fund Investment
Octroi Direct Expenses
Office Expenses Indirect Expenses
Oil Direct Expenses
Opening Stock Stock in Hand
Output VAT 4%, 12.5% Duties & Taxes
Outstanding Expenses Current Liabilities
Packing Exp. Indirect Expenses
Pan and Tea Expenses Indirect Expenses
Personal Expenses Capital Account
Petrol Expenses Indirect Expenses
Plant & Machine Fixed Assets
Postage & Telegram Indirect Expenses
Power & Fuel Direct Expenses
Prepaid Expenses Current Assets
Printing & Advertisement Indirect Expenses
Printing & Stationery Indirect Expenses
Printing, Papers & Advertisement Indirect Expenses
Production Wages Direct Expenses
Profit on Consignment Indirect Incomes
Profit on Jointventure Indirect Incomes
Provision for Bad Debts Indirect Expenses
Provision for Discount on Creditors Indirect Incomes
Provision for Discount on Debtors Indirect Expenses
Provision for Office Expenses Current Liabilities
Purchase Purchase Account
Purchase of New Land Fixed Assets
Purchase of Raw Material Purchase Account
Purchase Return Purchase Account
Purchase UP/ Ex-UP Purchase Account
Railway Authority Sundry Debtors
Rates & Taxes Indirect Expenses
Refreshment Expenses Indirect Expenses
Refrigerator Fixed Assets
Rent Indirect Expenses
Rent & Tax Indirect Expenses
Rent on Purchase Direct Expenses
Rent Payable Current Liabilities
Rent Received Indirect Incomes
Repair & Renovation Indirect Expenses
Tally Notes
14
Repairing Charges Received Indirect Incomes
Return Inward Sales Account
Return Outward Purchase Account
Salary Indirect Expenses
Salary & Wages Indirect Expenses
Salary Payable Current Liabilities
Sales Sales Account
Sales Return Sales Account
Sales UP/ Sales Ex-UP Sales Account
Scooter Fixed Assets
Shares / Bonds Investments
Shop Fixed Assets
Shop Expenses Indirect Expenses
Shop Rent Indirect Expenses
Showroom / Shop Fixed Assets
Showroom Repair Indirect Expenses
Stable Expenses Indirect Expenses
Stamp & Postage Indirect Expenses
Stationery Indirect Expenses
Stock (1st April and 31st March) Stock in Hand
Stock of Material Current Assets
Sundry Creditors Sundry Creditors
Sundry Debtors Sundry Debtors
Tea Exp. Payable Current Liabilities
Tea or Coffee Expenses Indirect Expenses
Telephone Expenses Indirect Expenses
Telephone Securities Indirect Expenses
Trade Expenses Indirect Expenses
Train Freight & Rent Direct Expenses
Travelling Expenses Indirect Expenses
Typewriter Fixed Assets
Unearned Income Current Liabilities
UPTT Duties & Taxes
VAT Payable Current Liabilities
Vehicle Repair Indirect Expenses
Wages Direct Expenses
Wages on Production Direct Expenses
Tally automatically opens A Discussion on Each of the Reserved Groups
1. Capital Account
This holds the Capital and Reserves of the company. Examples of ledgers that may be opened under
this group are Share Capital, Partners' Capital A/c, Proprietor's Capital Account.
Reserves and Surplus [Retained Earnings]
Open ledgers like Capital Reserve, General Reserve, Reserve for Depreciation, etc.
Tally Notes
15
2. Current Assets
Directly under Current Assets, you may find place for assets that do not fall under the following sub
groups:
Bank Accounts
For Current, savings, short term deposit accounts, etc.
Cash-in hand
Tally automatically opens one Cash A/c under this group. You are permitted to open more cash
accounts, if necessary.
Note: An account under Cash-in-hand group or Bank Accounts/Bank OCC A/c group is printed as
separate Cash Book in the traditional Cash Book format and does not form part of the Ledger.
Deposits (Asset)
In essence, a place for Fixed Deposits, Security Deposits, or any deposit made by the company (not
received by the company, which is a liability).
Loans & Advances (Asset)
For all loans given by the company and advances of a non-trading nature, e.g., advance against
salaries, or even for purchase of Fixed Assets. We do not recommend you to open Advances to
Suppliers account under this group. Doing so gives rise to the difficulty in ascertaining advance
position of a particular supplier and to adjust future bills against such advances. For further details,
please refer to the section on Common Errors.
Stock-in-hand
This is a special group. You may wish to open accounts like Raw Materials, Work-in- Progress and
Finished Goods. How the balances are controlled depends on whether you opted to maintain an
integrated account-cum-inventory system in the company features. (refer to Company creation
section for more details) Let's consider the options:
Integrated Accounts-cum-Inventory
You are allowed transactions in Inventory records and the account balances are automatically
reflected in the Balance Sheet as Closing Stock. You are not allowed to directly change the closing
balance of an account under this group.
Non-integrated Accounts-cum-Inventory Accounts that fall under this group are not permitted any transactions. It allows you to hold opening and closing balances only. Since no vouchers can be passed for these accounts, they are the only accounts for which the closing balances can be directly altered (by an authorised user only) Sundry Debtors For your customer accounts. Do not open them under the Sales Account group, which is a revenue account. For more information on common and possible errors in grouping of accounts, please refer below to the separate paragraph on the topic. 3. Current Liabilities You may open accounts like Outstanding Liabilities, Statutory Liabilities and other minor liabilities directly under this group. Sub-groups under Current Liabilities are Duties and Taxes, Provisions and Sundry Creditors Duties and Taxes
Tally Notes
16
For all tax accounts like VAT, MODVAT, Excise, Sales and other trade taxes. A convenient place to find the total liability (or asset in case of advances paid), as well as the break-up of individual items. Provisions For provision accounts like Provision for Taxation, Provision for Depreciation, etc. Sundry Creditors For trade creditors of the company. Do not open your supplier accounts under the Purchases Account group, which is a revenue account. For more information on common and possible errors in grouping of accounts, please refer below to the separate paragraph on the topic. 4. Investments To group your investment accounts like Investment in Shares, Bonds, Govt. securities, long term Bank deposit accounts, etc. A convenient place to view the total investments made by the company. 5. Loans (Liability) For loans, typically long term, taken by the company. Bank OD Accounts [Bank OCC Accounts] Tally gives two distinct types of Bank Accounts, The Bank OCC A/c is meant to record the company's overdraft accounts with banks. e.g., Bill Discounted A/cs, Hypothecation A/cs etc. Note: An account under Bank OCC A/c group is printed as separate Cash Book in the traditional Cash Book format and does not form part of the Ledger. Secured Loans For term loans and other long/medium term loans that have been obtained against security of some asset. Tally does not verify the existence of the security. Typical accounts would be Debentures, Term Loans, etc. Unsecured Loans For loans obtained without any security .e.g., Loans from Directors/partners or outside parties. 6. Suspense Account Theoretically speaking, this group should not exist. However, in modern accounting, many large corporations use a Suspense Ledger to track moneys paid or recovered, the nature of which is not yet known. The most common example is money paid for Travelling Advance whose details would be known only upon submission of the TA bill. Some companies may prefer to open such accounts under Loans and Advances (Asset) group. Please note that Suspense Account is a Balance Sheet item. Any expense account even if it has 'suspense' in its name, should be opened under a Revenue group like Indirect Expenses and not under Suspense Account group. 7. Miscellaneous Expenses (Asset) This group is typically used more for legal disclosure requirements, like Schedule VI of the Indian Companies Act. It should hold incorporation and pre-operative expenses. Companies would write off
Tally Notes
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a permissible portion of the account every year. A balance would remain to the extent not written off in Profit & Loss Account. Tally does not, however, show a loss, carried forward in the Profit & Loss Account, under this group. The Profit & Loss Account balance is shown separately in the Balance Sheet. 8. Branch/Divisions This group is provided to keep the ledger accounts of all companies that are your company's branches, divisions, affiliates, sister concerns, subsidiaries, etc. This is a group of convenience. You may not wish to utilise it in this manner. Note that Tally permits Sales and Purchase transactions to take place with accounts opened here. Remember, these are their accounts in your books and not their books of accounts. Just treat them as you would any party account. If you wish to maintain the books of that branch/division on you computer, you must open a separate company. (Tally allows maintenance of multiple company accounts). Revenue Primary Groups 9. Sales Account For different sales accounts. The natural segregation of your sales accounts could be based on Tax slabs or type of sales. This also becomes a simple mechanism for preparation of Tax returns. An example of such classification may be helpful: Classify under Sales Accounts the following sub-groups
Domestic Sales
Export Sales
Now under Domestic Sales open the following ledgers:
Sales (10%)
Sales (5%)
Sales (exempt)
You may even open an account Sales Returns under the group Domestic Sales to view your net sales after returns (or the returns may be directly passed through journal against the specific sales account). Please do not open customer accounts under this group. For more details on possible errors in this regard, please refer to the paragraph given below. 10. Purchase Account This is similar to sales accounts, except for the purpose of the transaction. 11. Direct Income [Income Direct] For non-trade income accounts that affect Gross Profit. All trade income accounts would naturally fall under Sales Accounts. You may wish to use this group for accounts like Servicing Contract Charges that follow sales of equipment. If yours is a professional services company, you may not use the Sales Account group at all. Instead, open accounts like Professional Fees under this group. 12. Indirect Income [Income Indirect] For miscellaneous non-sale income accounts, e.g., Rent Received and Interest Received. 13. Direct Expenses [Expenses Direct]
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For manufacturing or direct trading expenses. These accounts determine the Gross Profit of the company. the Profit & Loss Account which is a reserved primary account. You may use this account to pass adjustment entries through journal vouchers .e.g., transfer of profit or loss to Capital or Reserve account.
Cost Centres and Cost Categories
Cost Centre
A cost centre is a unit of an organization to which transactions can be allocated. Cost Centers are
units to which costs or expenses are allocated and Profit Centers are units to which incomes are
allocated. Tally.ERP 9's cost centres allow a dimensional analysis of financial information. Tally.ERP 9
gives you the cost centre break-up of each transaction as well as details of transactions for each cost
centre.
Cost Categories
Cost Categories have been introduced specially for project oriented organisations as they require
allocation of resources to parallel sets of cost centres. For example, the project is to construct an
airport. The airport is the cost centre. For this project certain expenses are incurred by the project
head. A simultaneous allocation of the amount has to be made for both the project and the project
head. This requirement can be achieved using Tally.ERP 9's Cost Category feature. Any number of
parallel allocations can be done as per requirements.
Activating Cost Category and Cost Centre
Ensure that you are at the Gateway of Tally of National Traders. To activate the cost centre and cost
category,
Set Yes to the following in the F11: Features (Accounting Features):
Maintain Cost Centres
More than ONE Cost Category
Creating Cost Categories
Go to Gateway of Tally > Accounts Info. > Cost Categories > Create.
Name: Projects & Assignments
Allocate Revenue Items: Yes
Allocate Non-Revenue Items: No
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6.2.5 Creating Cost Centre
Go to Gateway of Tally > Accounts Info. > Cost Centres > Create.
Category: Select Projects & Assignments.
Name: Projects.
Under: Primary.
Similarly create the following Cost Centres,
Buildings, Roads and Airports, by selecting Projects and Assignments as Cost Category and
Projects for Under.
Amar and Barry, by selecting Salesmen as Cost Category and Primary for Under.
Applying Cost Centres to Ledger Accounts
Create the following Ledger accounts,
Conveyance and Postage under Indirect Expenses
Consulting Fees under Direct Incomes.
Create Payment Voucher :
Go to Gateway of Tally > Accounting Vouchers > F5: Payment > Select Petty Cash from List of Types
1. Date: 13-07-09
2. You will notice that Tally.ERP 9 displays the Dr field. This is because the option Use Single Entry
mode for Pymt/Rcpt/Contra is set to No in F12: Configuration, while making the billwise receipt
entry.
3. Debit Conveyance Rs. 20 and press Enter.
4. The Cost Centre Allocation sub-screen appears on entering the amount.
� Select the Category as Projects & Assignments.
� Allocate the expense to Buildings.
� Press Enter for the entire amount of 20.00 for Buildings.
5. Since you have completed the allocation of the full amount, the cursor moves back to the main
voucher screen.
6. Credit Petty Cash 20
7. Type the Narration as Paid to Amar for travelling to Brigade Road for the Buildings Project.
8. Accept the voucher.
The completed Payment Voucher Creation will appear as shown
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Now, create one more Payment Voucher.
Go to the Gateway of Tally > Accounting Vouchers > F5: Payment > Select Petty cash.
1. Date: 17-07-09
2. Debit Conveyance: Rs. 50.00.
3. The Cost Centre Allocation sub-screen appears after you enter the amount
Select Projects & Assignments as Cost Category.
Allocate Rs. 30 to Buildings and Rs. 20.00 to Roads.
Press Enter to accept
The cursor moves to the Cost Category field, select Salesmen (Cost Category) > Amar and enter
the amount as Rs. 50
Press Enter to accept
The cursor moves to the Cost Category field, press Enter and the Voucher screen appears.
4. Credit Petty Cash Rs. 50
5. Type the Narration as Paid to Amar for travel to Brigade Road for the Buildings Project.
6. Before accepting the voucher, press F12: Configure and ensure that the option Show Cost
Centre Details is set to Yes.
The completed Payment Voucher Creation screen appears as shown below:
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7. Press Y or Enter to accept the screen. Create Receipt Voucher :
Go to the Gateway of Tally > Accounting Vouchers > F6: Receipt
1. Select Receipt Voucher (Petty Cash) and change the date to 13-07-09.
2. Credit Consulting Fees Rs. 1,000
3. In the Cost Centre Allocation for Consulting Fees,
� Select Projects and Assignments as cost category
� Select Buildings as cost centre and allocate the entire amount to it.
4. Debit Petty Cash Rs. 1000
5. Type the Narration as Received cash for work done by Amar on the Buildings project.
The Screen appears as shown:
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Budgets Tally allows you to create multiple budgets. There could be a budget for specific purposes, e.g., for the bank, for the head office, optimistic budget, realistic budget, pessimistic budget, etc. Departmental Budgets can also be created, e.g., Marketing Budget, Finance Budget, etc. As usual, you first create budgets. You can of course alter them. Budget figures are used to compare against actuals and to display variances. This is done by bringing up a new column when displaying a statement and selecting the appropriate budget. We shall now go through the creation and alteration of budgets. Gateway of Tally > Accounts Info > Budgets How to Manage and Operate Budgets? Gateway of Tally > Accounts Info > Budgets Create Name Give the budget a name, in this case, Corporate Budget. As you may have other budgets as well, the name distinguishes them. Under In the true Tally tradition, you can have a hierarchical budget set-up. At the top level is the Primary Budget. You can set up more than one Primary Budget. Under each Primary Budget, sub-budgets can be created. Period of Budget Specify the period of the budget. The period could be a month, a year or any period starting from any date to any date. Set/Alter Budgets of You may want to set the budget for groups of ledger accounts or for ledger accounts individually or for cost centres or all of them. We shall take up budget for group only. Follow the same process for setting budgets for individual ledgers and cost centres. Alter a Budget Accts Info. > Budgets > Select the budget to alter
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If you select to alter the Corporate Budget of Groups of ledger accounts, say Yes to 'Set / Alter Budgets of Groups'. The default is No. The same sub-screen for Group Budget pops up for alteration of the figures. Alter necessary fields and accept. Delete a Budget From the Menu Go to Alter select the Budget and Press [ALT]+[D] to delete it. Budget Variance The Trial Balance and Group Summaries carry an additional 'Budget Variance' button (Alt+B) which is active if Budgets are active and at least one budget exists. Pressing this button will create an automatic display of Budgets, Actuals with Percentage, Variance from budget with Percentage in three columns. This is a first-step offering of the facility and is being fine-tuned to enhance its range and diversity of options which you should see shortly.
Inventory Information The different inventory information that you would provide to Tally by way of masters are: Gateway of Tally > Inventory Info Stock Items Like Ledgers, Stock items are the primary inventory entity. You will use stock items while recording their receipts and issues. This is lowest level of information about your inventory. Each item that is required to be accounted for, needs to be created. In fact, you will create a stock ledger account for each item and Tally calls this account 'Stock Item'. Stock Groups Stock items can be grouped together under Stock Groups to reflect their classification based on some commonality. Grouping would enable easy location and reporting of stock items in statements. Hence, items of a particular brand can be grouped together so that you can extract stock of all items of that brand. For example, create Stock Groups like Sony, Maxell, Verbatim. Your stock items could then be Sony 3.5" disks, Maxell 3.5" disks, Sony tapes, Maxell tapes, etc. Classify the Sony products under the Stock Group Sony. Now you have ready details of all Sony products suitably classified. You may even group items as Raw materials and Finished Goods. You can create sub-groups of Stock Groups for deeper analysis. Stock Categories The concept is similar to Cost Categories. You may wish to refer to the Chapter on Cost Categories to grasp the similarity/differences. This option will come up in the menu only if you have opted for stock categories in [F11] Comp. Features. Stock Categories offers parallel classification of items. You may create Stock Categories like Floppy Disks and Floppy Drives. In the above example in Stock Groups, you would know how many Sony 3.5" floppies are in stock and separately, the stocks of Maxell floppies. You would also know from the Sony stock group the stock of all Sony items. However, should you require information like total stock of floppy disks or alternative items that could be used, these would be best available through Stock Categories. If you classify both Sony 3.5" diskettes and Maxell 3.5" diskettes under the Stock Category Floppy Disks, you know your total stock of floppy disks. Since the items are substitutes of each other, if one is out of stock, you can offer the other of the same category.
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Note: The Stock Query option under Statements of Inventory Display will reveal the strength of this feature. Note: You should configure inventory info using [F12] and [F11] to select only those features that you need. Try not to select features that you do not need. Stock Groups Gateway of Tally > Inventory Info > Stock Groups What is a Stock Group? The concept of stock groups has been explained above. Before we consider stock groups you would need to know about stock items. Like Ledgers, Stock items are the primary inventory entity. You will use stock items while recording their receipts and issues. This is lowest level of information about your inventory. Each item which you want to account for, needs to be created. In fact, you will create a stock ledger account for each item and Tally calls this account 'Stock Item'. Stock items can be grouped together under Stock Groups to reflect their classification based on of some commonality. Grouping would enable easy location and reporting of stock items in statements. Hence, items of a particular brand can be grouped together so that you can extract stock of all items of that brand. For example, create Stock Groups like Sony, Maxell, Verbatim. Your stock items could then be Sony 3.5" disks, Maxell 3.5" disks, Sony tapes, Maxell tapes, etc. Classify the Sony products under the Stock Group Sony. Now you have ready details of all Sony products suitably classified. You may even group items as Raw materials and Finished Goods. You can create sub groups of Stock Groups for deeper analysis Creating a Stock Group Gateway of Tally > Inventory Info > Stock Groups > Single Create Name Give the name of the stock group. Here we wish to create a group Sony. Under Specify whether it is a primary group or a sub-group of another group. Select from the pop up list. Here we select Primary from the list. Use Alt+C to create a parent if you do not have the group you want in the list. Can quantities of items be ADDED? This really pertains to information on the stock items that you would create under this stock group – Sony in this case. The stock items created under the group should have similar units to be 'addable'. You obviously would not want to add Kgs with Pcs (where you have a group like 'Consumables' and items like 'grease' and 'rag cloth' which are measured in kg and metres respectively). We select Yes here because we want to create items like floppy disks and disk drives etc which at this point we feel would be addable and the total meaningful. You may later set it to No, if you find that the totals do not make sense. It is, possibly, easier to set it to No initially and later set it to Yes on assessing the item units in the group. Display/Alter Stock Group Buttons in single mode stock group creation
Category
Items
Budget
Location
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Vch Types
Units
Currency You may switch to these master types to create them. Currency & Budget option are activated only when you have opted for the same in [F11]:Company Features. The Voucher Entries
Contra Entry (F4)
Payment Entry (F5)
Receipt Entry (F6)
Journal Entry (F7)
Sales Entry (F8)
Sales and Purchase Voucher Entry
Unconventional Vouchers
How to enter Vouchers
Sales and Purchase Voucher Entry Contra Entry (F4) Gateway of Tally > Accounting Vouchers > selecting F4: Contra > displays the Contra voucher entry screen. As per accounting rules, Contra Entry is a transaction indicating transfer of funds from: 1. Cash account to Bank account 2. Bank account to Cash account 3. Bank account to Bank account Contra Entry screen appears in the Single Entry Mode by default. You are prompted to choose the account, which will receive the amount (the debit ledger). For example, you wish to transfer of funds from Cash Account into Bank Account – you will debit the Bank Account and credit the Cash Account > the entry appears as: The ledger selected in "Account" (State Bank of India) is the destination ledger – debited. Advantages of Single Entry Mode: 1. Faster data entry! 2. Selection of Multiple Ledgers to be credited with a Single Ledger to be Debited OR Multiple Ledgers to be debited with a Single Ledger to be Credited -> depending on the nature of transaction. Important: 1. Use the buttons on the right-hand side of the screen to Explore the Potential of Tally. 2. Press [Enter] wherever the cursor is placed to know the Depth of Tally! Payment Entry (F5) Gateway of Tally > Accounting Vouchers > selecting F5: Payment > displays the Payment voucher entry screen. Payment transactions can be entered using Tally's
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Payment Voucher. The Payment Entry screen appears in Single Entry Mode by default (as the option "Use Single Entry mode for Pymt/Rcpt/Contra" is set to YES > in F12: Configure from Payment Voucher). For example, the company settles expenses of conveyance, staff welfare, postage and stationery through cash – all in one voucher. The entry is displayed as: You are prompted to choose the cash or bank ledger, which will pay the amount (the credit ledger). Payment Entry - Double Mode In Double entry mode – you can select multiple debit and credit ledgers. To do so on the Payment voucher screen, click on F12: Configure and set the option "Use Single Entry Mode for Payment/Receipt/Contra" to NO. The entry displayed in Single Mode appears in Double entry mode as: Advantages of Double Entry Mode: 1. You can select any number of ledgers to be debited and credited in the payment voucher. 2. You can view on screen whether a ledger has been debited or credited – thereby enabling you to cross-verify. Payment Entry – Single Narration In Payment transaction - Single and Double entry modes – you viewed the vouchers with common narration – where the narration details are given for the entire voucher at the end. However, if you want the narration details for every ledger you debit or credit (Single narration) – you can configure Tally's Narration details accordingly. To do so > from Gateway of Tally > Accounts Information > Voucher Types > Alter > select the required Voucher Type and activate the option Narrations for each Entry and accept the details. Return to Accounting Vouchers on Gateway of Tally and enter a payment voucher as required. Given below is an example of a Payment transaction with narrations for each entry: The entry consists of both common narration and narrations for each entry – the advantage being in case of multiple debit / credit entries - you can give single line narration separately - for every ledger account selected. Receipt Entry (F6) Gateway of Tally > Accounting Vouchers > selecting F6, we get the Receipt voucher screen. Similar to Payment and Contra vouchers – the Single Entry Mode appears for Receipt Entry as well. Transactions accounting for money received are entered into Tally through the receipt voucher. For example, your company receives money from a customer for an earlier transaction. The customer account has to be credited and if cash is received – debit the cash account. If cheque is received debit the bank account where you will deposit the money received.
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The entry in double-entry mode is displayed as: On the Receipt entry screen, access F12: Configure -> activate the option "Use Payment/Receipt as Contra" – the behaviour is similar to that of Payment entry as Contra. Important: 1. Use the buttons on the right-hand side of the screen to Explore the Potential of Tally. 2. Press [Enter] wherever the cursor is placed to know the Depth of Tally! Journal Entry (F7) Gateway of Tally > Accounting Vouchers > selecting F7: Journal. Journal entries are used in instances where the company requires to adjust the debit and credit amounts without involving the cash or bank accounts. Hence, they are referred to as adjustment entries. For example, there may be entries made for interest accrued or interest to be paid. If a party is involved in such a transaction – the entry will be Dr Party Cr Interest Account The entry appears as: Journal entries are used usually for finalization of accounts. For more options in Journal Entry – please click on the links under "More". Important: 1. Use the buttons on the right-hand side of the screen to Explore the Potential of Tally. 2. Press [Enter] wherever the cursor is placed to know the Depth of Tally! Sales and Purchase Voucher Entry In Accounts-with-Inventory Companies when Tracking Numbers is NOT activated We shall use sales as our voucher for discussion. The same applies to Purchases. You do not get the voucher types Receipt Note and Delivery Note in the Sales and Purchase Voucher sub-menus. In addition to the above particulars that are applicable for all types of vouchers, sales and purchase vouchers have special inventory considerations for accounts-with inventory companies. Sales and Purchase ledger accounts must have the option 'Are Inventory Values Affected' set to Yes for this section. Sales Entry (F8) When a sales transaction takes place, a document, detailing the transaction (item name, tax, etc) has to be given to the buyer (debtor) as proof of purchase by him. This document is called "Invoice" or "Bill" or "Cash Memo". The practice of issuing an Invoice, which is in vogue, is available in Tally.
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Gateway of Tally > Accounting Vouchers > selecting F8, Tally displays the Sales Invoice screen. The Invoice mode is default. To enter details of sale transactions – use Tally's Sales entry (F8 – in Accounting Vouchers). Sales entries can be made in the Voucher as well as Invoice Formats. Invoicing or sales invoicing is not very different from sales voucher entry. The advantage of using the invoice format for sales invoice entry is that, automatic calculations of taxes and duties (ledger accounts classified under the group 'Duties & Taxes') is possible. The default Sales Invoice screen appears as: Tally prompts for the Sales Ledger to be allocated to - at the beginning of the entry. There after, any number of stock items or account ledgers can be selected one after another – enabling faster data entry. This is possible as the option Use Common Ledger A/c for Item Allocation in F12: Configure on the invoice entry screen is set to YES (by default) There are two types of Invoices, namely, Item Invoice > you can select ITEMS for invoicing Account Invoice > you can select LEDGERS for invoicing Note: Click on the links – "Example" for more details Journal Entry (F7) Gateway of Tally > Accounting Vouchers > selecting F7: Journal. Journal entries are used in instances where the company requires to adjust the debit and credit amounts without involving the cash or bank accounts. Hence, they are referred to as adjustment entries. For example, there may be entries made for interest accrued or interest to be paid. If a party is involved in such a transaction – the entry will be Dr Party Cr Interest Account The entry appears as: Journal entries are used usually for finalization of accounts. For more options in Journal Entry – please click on the links under "More". Important: 1. Use the buttons on the right-hand side of the screen to Explore the Potential of Tally. 2. Press [Enter] wherever the cursor is placed to know the Depth of Tally! Types of Inventory Vouchers Tally is pre-programmed with a variety of inventory vouchers, each designed to perform a different job. The standard vouchers are:
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1. Receipt note voucher (Alt + F9) 2. Rejections-in voucher (Ctrl+F6) 3. Delivery note voucher (Alt +F8) 4. Rejections-out voucher (Alt+F6) 5. Stock journal voucher (Alt+F7) 6. Physical stock voucher (Alt+F10) Unless you have Tracking numbers activated in F11:Company Features, the Goods In Receipt Note and Goods Out Delivery Note vouchers will not be activated. Tally will assume that goods are received along with Purchase Vouchers and Goods are delivered along with Sales Vouchers/Invoices. When Tracking Numbers are activated, you inform Tally that you may receive goods that are not accompanied by Supplier's invoice – the invoice will arrive separately. Also that you may not deliver goods together with your invoice – you may invoice later. Note: You are allowed, however, in a voucher, to select 'Not Applicable' when the Tracking Number sub-screen comes up. This would update inventory right away without the need to pass a separate inventory voucher. The vice-versa is also true. See Advanced voucher entry for more details. You can alter these vouchers to suit your company, as well as create new ones. For example, if you wish to distinguish between delivery notes for stock delivered from different locations, you can create vouchers to do this. The function of each voucher type is now explained. Receipt Note Voucher For recording goods received. For example, the company receives new stock from a supplier. If a Purchase Order exists for that Supplier, selecting it will bring up the order particulars. Delivery Note Voucher For recording goods delivered to a customer. For example, the company delivers goods from stock to a customer. If a Sales Order exists for that customer, selecting the appropriate Sales Order will bring up the relevant particulars. Stock Journal Voucher For recording stock transfers from one location to another. For example, the company transfers items of stock from the warehouse to the shop. Physical Stock Voucher For recording actual stock as physically verified or counted. For example, stock found on conducting a stock-check. It is not unusual that the company finds a discrepancy between the actual stock and the computer stock figure. If you have configured your inventory vouchers to Ignore physical stock differences, these physical stock vouchers will really be for recording purposes only. However, if you have configured the vouchers not to ignore physical stock difference, then all transactions subsequent to the physical stock voucher will use the balance as mentioned in that voucher.
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How to Create a Stock Journal? Gateway of Tally > Voucher Entry > [ALT]+F7 or Click on Stock Journal A stock journal is used to transfer materials or stock from one location to another location. Stocks could even simply be shown as consumed. Or even only produced without both consumption and production. Hence, it is not like other journal where debits and credits must match. You can specify quantities that are move as well as their rates and amounts. If standard rates have been entered in the stock item masters, they will appear. In the target location, you can specify additional costs incurred without actually affecting accounting at all. Only the stock value goes up. Hence, it is technically correct where an expense incurred on production or inward has been accounting for in the cost of that item. The Stock Journal Screen has three parts – the top part accepts general information, the left hand side is the Source location or Consumption Part and the right hand side is the Destination location or the Production Part. While you must furnish the common information required in the top part, you may elect to give information for only the left or the right part or both. How to Create a Purchase Order? Purchase Order details will also depend on configuration settings. Hence, have a look at the configuration and voucher types. Gateway of Tally > Voucher Entry > F9:Purchase > Select Purchase Order Party's A/c Name Give the supplier's name. Type in the same manner as voucher entry and select from list of Ledger Accounts. Use [alt]+[C] to create a new account. Order No The voucher number can be treated as your Purchase Order number. You may configure the voucher type through Acct. Info > Voucher Types to set prefixes and suffixes for Purchase Orders. This particular Order No. field is an additional field to record order number if different from the voucher number. Name of the Item Give the name of the stock item for which the order is to be placed. Once the name is given the Item Allocations sub-screen pops-up that needs to be filled in. Due on The due date for delivery of the item. This will enable monitoring of outstanding deliveries. The order can be split for delivery on different dates. Location In case multiple location feature is active, this field is required to be given, else it does not appear. Quantity, Rate and Amount
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Give the quantity of the item required, and its rate. The amount is calculated but is modifiable to enable rounding off. Additional Cost Details Additional cost on the item may be incurred which can be mentioned here. Give by way of percentage of the item cost or a flat amount. If not, select End of List. Additional costs increase the value of the item and do not independently appear in the nominal ledger account or expense. Next Item The cursor then comes to the Item field once again and you can enter another item to order. If no other item is required, press [enter] on the blank field to take the cursor to the tax/expense field. Expense/Tax Once the item details have been entered, you might specify tax to be charged and other expenses like freight, if any. The tax or expense has to exist as a ledger account or it may be created using [alt]+[C]. We shall select tax @ 17.5% to be charged on the item values. The order entry screen would then appear thus: Narration Optional. You may give some particulars about the order. How to Create Sales Orders? Sales order entry is exactly like Purchase Orders. Sales Order details will also depend on configuration settings. Hence, have a look at the configuration and voucher types. Gateway of Tally > Voucher Entry > F8:Sales > Select Sales Order Party's A/c Name Give the customer's name. Type in the same manner as voucher entry and select from list of Ledger Accounts. Use [alt]+[C] to create a new account. Order No The voucher number can be treated as your internal serialised order number. The field Order No. is advised to be used for the customer's order number. Name of the Item Give the name of the stock item for which the order is to be placed. Once the name is given the Item Allocations sub-screen pops-up that needs to be filled in. Due on The due date for delivery of the item. This will enable monitoring of outstanding deliveries.
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The order can be split for delivery on different dates. Location In case multiple location feature is active, this field is required to be given, else it does not appear. Quantity, Rate and Amount Give the quantity of the item required, and its rate. The amount is calculated but is modifiable to enable rounding off. Additional Cost Details There is no additional cost details for sales orders. They exist only for Purchases as the values are added to the cost price. In case of sales, additional cost need to be entered below the line along with tax. Next Item The cursor then comes to the Item field once again and you can enter another item to order. If no other item is required, press [enter] on the blank field to take the cursor to the tax/expense field. Expense/Tax Once the item details have been entered, you might specify tax to be charged and other expenses like freight, if any. The tax or expense has to exist as a ledger account or it may be created using [alt]+[C]. We shall select tax @ 17.5% to be charged on the item values. The order entry screen would then appear thus: Narration Optional. You may give some particulars about the order.