Basics of Accounting Tally is an Accounting Software that helps you in maintaining Accounts and Inventory of your office.
General Accounting What is Accounting
“Accounting is the art of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events, which are in part, at least, of a financial character, and interpreting the result thereof” – American Institute of certified public accountants.
Methods of Accounting There are two types of Accounting Systems. 1. American Method or Single Entry System. 2. English Method or Double Entry System.
1. American Method or Single Entry System. It has further five types of accounting. I. Assets Accounts II. Liabilities Accounts III. Capital Accounts or Owner’s Equity A/c IV. Revenue or Income Accounts V. Loss or Expenses A/c
Methods of Recording I. Debit the Increase in the Assets and Credit the Decrease in the Assets. II. Credit the Increase in the Liabilities and Debit the Decrease in the Liabilities. III. Credit the Increase in the Capital and Debit the Decrease in the Capital. IV. Credit the Increase in the Income and Debit the Decrease in the Income. V. Debit the Increase in the Expenses and Credit the Decrease in the Expenses.
2. English Method or Double Entry System. Classification of Accounts 1. Personal Accounts: These accounts are those accounts which are opened by a name of a person, firm, company, society or organization.
Rules: “Debit the Receiver and Credit the Giver”. Types of Personal Accounts: I. Natural Personal Accounts: a) MAHESH’s Accounts b) Owner’s Capital Accounts c) Owner’s Drawing Accounts d) Debtors Accounts e) Creditors Accounts II. Artificial Personal Accounts
a) Firm’s Accounts a) Company’s Accounts b) Organization Accounts c) Bank Accounts d) Club Accounts e) Insurance Company Accounts f) Government Sector accounts III. Representative Personal Accounts a) Outstanding Salary Due to Staff account b) Prepaid Insurance Account c) Accrued Income Account d) Unearned Commission Account 3. Real Accounts : Those Business assets which can be measure in the term of money
their accounts are called Real Accounts.
Rules: “Debit what comes in and Credit what goes out”. Types of Real Accounts: I. Tangible Real Accounts: These accounts are those assets account which can be touched. a) Cash Account b) Stock Account c) Furniture Account d) Land Account e) Building Account II. Intangible Real Accounts: Those accounts are those assets account which can’t touch but can be measured in the term of money. a) Goodwill Accounts b) Patents Accounts c) Trade Mark Accounts d) Copy Right Accounts 4. Nominal Accounts : Income and Expenditure accounts of a business are called nominal accounts.
Rules: “All the Expenses are debited and Incomes are credited”. Types of Real Accounts: I. Expenditure Accounts: a) Salary Paid Accounts b) Rent Paid Accounts c) Bed Debts Accounts d) Commission Paid Accounts II. Income Accounts: a) Salary Received Accounts b) Rent Received Accounts c) Commission Received Accounts d) Interest Received Accounts e) Bed Debts Recovered Accounts
Steps for working in the Tally
1. Create Company: In Tally this is the First task or primary task to create a company. For this Purpose we have to select the Create Company option from menu Gateway of Tally. After selecting the option we have to fill up the details for the Company like Company Name, Address, Started Date, and Income Tax No etc. 2. Creates Groups: Groups are created for same type of Ledger A/cs. In Tally There are many groups which are used for making ledgers. So in the rare cases we have to create groups. These are the main groups in the tally. I. Reserve and Surplus (Retained Earning): You can use this group heads like Investment Allowance Reserve, Select Ledger and other such reserve accounts. a) Current Assets: This is the primary group that has all the current assets accounts. It has Six Sub Groups under it. b) Bank Accounts: It is used to hold all accounts of banks. c) Cash in hand: It is used to hold ledger account of cash. d) Deposits: It is used to hold assets like security deposits, rental deposits and all other deposits made by the company. e) Loan and Advances: It is used to hold all advances and loans of non trading nature given by the company. f) Stock in hand: It is used to hold certain special accounts like raw material, finished goods and work in progress. g) Sundry Debtors: It is used to hold accounts of companies and individuals that give goods on credit to the company. III. Current Liabilities: This is a primary group and is used to hold outstanding and statuary liabilities of the company. The group has three sub groups under it which are as follows. a) Duties and taxes: It consists all types of taxes and duties like Excise, Local Sales tax, Central Sales Tax, VAT etc. b) Provisions: It is used to hold other tax provisions like Income tax, depreciation in it. c) Sundry Creditors: It is used to hold accounts trade creditors of the company. IV. Fixed Assets: This is used to keep accounts of all the fixed assets, patents, trade tights etc. V. Investment: This is used to hold ledger accounts of shares, bonus and other securities of the company. VI. Loan Liabilities: This is used to keep track of loan taken by the company. This group has three sub groups which are as follows. a) Bank OD Accounts: It is used to hold all overdraft accounts with banks. b) Secured Loans: It is used to hold long/medium term loans taken by the company from financial companies and Banks etc. c) Unsecured Loans: It is used to hold the loans taken unconditionally by the company. VII. Suspense Accounts: This is used by many companies to
maintain a suspense ledger which keeps track of money received or paid by the companies, whose nature of transaction is not yet known. VIII. Miscellaneous Expenses: The loss of the company, which has not been written off but carried forward to the next year, should fall here. However, tally treats it as a negative profit and carries it to the profit and loss account. IX. Branches/Division: This is used to keep the names of all companies which may be branches, divisions of the company. X. Sales Account: It is used to all goods sales accounts of the companies. XI. Purchase Account: It is used to all goods purchase accounts of the companies. XII. Direct Income: It is used to hold ledger accounts of non‐trade income accounts that affect gross profit. XIII. Indirect Income: This is used to hold ledger accounts of those expenses of the company that determine its gross profit. For example interest received and commission received. XIV. Direct Expenses: This is used to hold ledger accounts of those expenses of the company which determine its gross profit. Expenses like salary paid to labour, transportation, electricity bills etc. XV. Indirect Expenses:This is used to hold ledger account of those expenses of the company, which determine its net profit. Expenses like advertising, maintenance of vehicles, administrative expenses etc. 3. Create Ledgers: Ledgers are actual account heads to which the transactions are identified. You Make all voucher entries in these accounts. You have to classify all ledgers in to groups. 4. Voucher Entries: For Making the Voucher Entries first of all we have to set the voucher date by pressing F2 then enter the voucher date. There are various types of vouchers in tally. Those are describes as follows: ‐ I. Contra Voucher: This type of voucher is used for Cash to Bank, Bank to Cash and Bank to Bank Entries. Press F4 to select the voucher type. II. Payment Voucher: This type of voucher is used for the Cash Payment Entries. Press F5 to select the voucher type. III. Receipts Voucher: This type of voucher is used for the Cash Receipts Entries. Press F6 to select the voucher type. IV. Journal: This is used for the Journal Entries like debit of credit Entries. Press F7 to select the voucher type. V. Sales Voucher: This is used for the Goods Sales Entries. Press F8 to select the voucher type. VI. Purchase Voucher: This is used for Goods Purchase Entries. Press F9 to select the voucher type. VII. Memo: This is used to create Memorandum or Reverse Journal Voucher. Press F10 to select the voucher type. 5. Display Reports: There are several types of reports are generated by the tally like Trading and Profit and Loss Account, Balance Sheet,
Inventory Reporting Ratio Analysis etc.
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). Tally software was developed by Mr.Bharat Goenka in the year 1988.
Features of Tally
1. Accounting wihtout codes 2. Comprehensive Accounting. Maintains complete range of books of Accounts, Final A/c’s like Balance Sheet , Profit & loss A/c, cash and fund flow , Trial Balance and others. 3. Provides Multiple reports in Diverse formats 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 and balance sheet and ledger , trial balance and profit and loss a/c. 11. Backup and restore option 12. Tally is allow to cheque printing 13. Multi tax calculation like VAT, TDS, TCS, FBT, e t c . 14. Calculate Payroll calculation easily. 15. Use Security levels for audit purpose.
To start Tally : Start -> Programs ->Tally 9 -> Tally 9 Release 2 Or Double click on the Tally shortcut in the desktop to open Tally
Tally Screen Components:
1) Title Bar - Displays the version number , system date and time 2) Gateway of Tally - Displays menus, screens and reports. 3) Calculator - used for calculator functions. 4) Buttons toolbars - displays buttons that provide quick interaction with tally. 5) Minimize Button - Performs the standard windows function allowing us to minimize tally to work on other applications.
Creating a Company When Tally first loads the Gateway of Tally area is available. When no companies are there , then the Select company option is not activated. The cursor is placed the create company meaning that a company should be created. Press enter in Create company option in order to create a company. To create a company choose create company option in the gateway of tally screen or company information menu. While creating a new company it will ask for the following inforamtion.
a) Directory - In this if needed we have to specify the path where the company file should be stored in your computer. By default D:\Tally\Data is the path taken. b) Name - In this we have to type the name of the company. c ) Mailing Name - In this we have to type the mailing name, which is used to all the letters used in Tally. d) Mailing Address - In this we have to type the mailing address, such as street , city, pincode for the company. e ) E-mail Address - In this we have to type the E-mail id for the company. f) Statutory compliance for - By default the statutory compliance for India. It is used for tax calculation for country wise. g) Currency Symbol - By default the currency symbol Rs is taken. Since Tally is a Indian product. h) Maintain - In this we have to choose either Accounts only or Accounts with Inventory i ) Financial Year - In this we have to type the starting date of the financial year. In accountancy financial year start from April 1 of year to Mar 31 of the next year. For example 1 april 2007 to 31 march 2008. Automatically tally adds 12 months with the starting date of the financial year. j ) Book Beginning From - In this we have to 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. k) Tally Valut Password - In this we have to specify the password for the company, if so the company name will not be displayed in the Select company option. l ) Use Security Control - While opening the company if we need to specify the user name and password for protection ( ex: other person can’t open our company) , we can make this option to yes and specify the user name and password. m) 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, Is symbol suffixed with amount etc. Note : All the above information is not must, we can specify the important things and omit the others.
Group And Leger Accounts Organization: Ledger accounts and groups In manual accounting, accounts are grouped upon preparation of Trial balance to prepare final accounts, namely Profit and loss A/c and Balance Sheet. In tally at the time of creation ledger accounts, we place it under appropriate account group. Account Groups provide us the ability to classify our accounts to get all the reports instantly and properly classified. We have the liberty to re-group later to suit our requirements.
Creating a Group
Tally provides a list of 28 pre-defined groups. Of these, 15 are primary groups and 13 are sub-groups. We may configure our groups to enable / disable advanced mode. Press F12 -> Accts/ Inv info -> Account Masters -> Set to yes the following options Allow Advances entries in masters - Yes Use Address for Ledger Accounts - Yes Single group - Allows us to work on one group or sub-group at a time. Gateway of Tally -> Accounts Info -> Groups -> Single -> Create Name of Group : Enter the name of the desired group or sub-group ( eg: Salary) Alias : Give an alias to allow access the group using the alias in addition to its name , or leave it blank Under: Specify under which existing (Parent) group the sub-classification is needed. We can create a new parent group by using Alt +c. In other words Alt +C is the shortcut key to create a ledger or group during creation or during voucher entry.
Altering Groups Once created, groups can be altered by selecting Alter for single or multiple groups. The procedure is the same as we used to display groups except of course we may alter the data.
Deleting Groups
We can delete a group via the Group Alteration screen by pressing Alt +D. However , we cannot delete Tally pre-defined groups,or groups with subgroups, or groups containing ledgers. The lowest level must be deleted first.
Ledgers Once we have created necessary Masters, now it is the turn of ledger creation. Tally on its own, Creates 2 ledgers listed below all others we have to create. Cash (under Cash- in - hand Group) Profit & Loss Account (Primary edger) Ledger is the actual account head to which we identify a transaction. We pass all accounting voucher entries using ledgers. All ledgers have to be classified into groups. Hence, a through understanding of account classification is important working with ledgers List of ledgers frequently used and their related Groups 1. Capital Account → Capital Account 2. Name of your creditors → Sundry Creditors 3. Name of your Debtors → Sundry Debtors 4. Name of Expenses → Direct Expenses or Indirect Expenses according to the nature of expenses 5. Name of Income → Indirect Income
6. Name of Bank → Bank Account 7. Name of Current Asset → Current Assets • stock in hand • deposits • show short term investment 8. Name of Fixed Asset → Fixed Asset 9. Name of Current Liabilities → Current Liabilities 10. Name of Fixed Liabilities → Fixed liabilities 11. Name of Loss → Direct Expenses or Indirect Exp. 12. Bad Debts → Indirect Exp. 13. Provision for Bad Debts → Current Liabilities 14. Outstanding Expenses → Current Liabilities 15. Advance Income → Current Liabilities 16. Outstanding Income → Current Assets 17. Sale Tax / VAT → Duties and Taxes 18. Excise Duty / CENVAT → Duties and Taxes 19. Drawing → Capital 20. Purchase → Purchase account 21. Sale → Sale Account Ledgers can be created in single and multiple modes. In multiple mode you can create multiple ledgers at a time. Go to Gateway of Tally> Accounts Info. > Ledgers> Create (under Single Ledger) Name Enter the Name of the account Alias Enter an alias name if required Under All accounts must be classified under their appropriate Groups. Select the Group under which the Ledger is created from the List of Groups. Go to Gateway of Tally> Accounts Info > Ledgers > Create (under Multiple Ledgers) Under Group Select the name of the group under which you want to create the Ledgers from the List of Groups. S.No This is auto generated. Name of Ledger Enter the name of the Ledger. Under This field defaults to the parent group selected in Under Group
Opening Balance This is the balance remaining when you first enter your books on Tally, i.e. the date of beginning of books Exercise: 1 Name : King Sons Mailing Name : King Address : 101, 7th Main, M.G. Road, Bangalore State : Karnataka PIN Code : 588 002 Telephone No : 6789999 E-Mail :
[email protected] Currency Symbol : Rs. Maintain : Account only Exercise: 2 Name : GI Enterprises Mailing Name : GI Address : 45, 3rd Main, Rajajinagar, Chennai State : Tamil Nadu PIN Code : 600 268 Telephone No : 4789043 E-Mail :
[email protected] Currency Symbol : Rs. Maintain : Account with Inventory Exercise: 3
Create a Ledger: Mariya’s Capital A/C Canara Bank Purchase Sales Rent Electricity Bill Wages Stationery Discount Paid Insurance Paid Discount Received Commission Paid Paid Petty Cash Office Expenses
Exercise: 4
Ravi’s Capital A/C SBI Bank A/C Purchase A/C
Sales A/C Machinery & Furniture A/C Investment A/C Brokerage A/C Typewriter A/C Purchase from Nick Computers A/C Rent A/C Salary A/C Return Inward A/C Return Outward A/C Drawing A/C Sold to Suresh A/C Traveling Expenses A/C Discount Allowed A/C Telephone Charges A/C Sales to Raba Traders A/C
Accounting Vouchers In manual accounting, we record transactions through Journal entries. In computerized Accounting systems we do it through Voucher entry. Normally, a transaction is supported by a Document, e.g., Supplier’s Bill, Copy of Sales Bill , Counter foil/ Record Slip entry of Cheque book , Pay -in-slip , Pay Register etc. For every transaction/ source document, we should enter a Voucher. A voucher contains details of the transaction. Particulars If you create Accounts voucher In this field you should specify Dr or Cr. Type the letter D or Dr over the existing prompt to change, then select the ledger name from the pop-up list that Tally opens. There may be multiple Debit and Credit entries in one single voucher. If you create Inventory voucher If you are creating inventory voucher in Tally you will give information about the stock item you receive or issue and item related details like the Godown/warehouse, Batch Details, Quantity, Rate, Amount etc. Debit / Credit Amount: This field appears in Accounts voucher only. Enter the amount of transaction and press Enter key. Tally will update current balance of the ledger and display it. This will happen only if you gave 'Yes' to the question 'Show Ledger Current Balance?' under Accounting Voucher in Vouchers Entry under F12: configure option. The total will appear on the bottom of the Debit and Credit columns. If both credit and Debit totals are not equal Tally will prompt to enter further Credit / Debit to balance the voucher. If both are equal Tally will move the cursor to Narration field.
The Narration field The last field of Voucher is Narration, here you enter details of the transaction entered in the voucher. It is not mendatory / compulsory to give narration. You can type anything about the transaction or just leave this field blank. You can turn off narration by responding No to the question 'Use Common Narration?' at voucher creation/alteration screen. Saving the Voucher: After entering narration, when you press Enter key a confirmation prompt will appear Asking 'Accept Yes/No?'. Press Y or Enter to save the voucher or press N to return cursor to the first entry allows you to alter any data in the voucher. If you give Y Tally will save the voucher and blank screen will appear next to continue voucher entry. Voucher Types in Tally: Payment voucher: The payment voucher is for all payments you make through cash or Bank. These payments can be towards expenses, purchases, to trade creditors, etc. Follow the below procedure to create a payment voucher. All payment vouchers must have first entry a debit and at least one credit to a Cash or a Bank Account. You can have any number of debit and credit entries. However, if you do not credit one cash or bank account and still try to accept the voucher a message appears asking for a cash or bank account. If configured, Fund Transfer entries can also be made in payment voucher. If you have given Yes to 'Print After Saving Voucher?' in Voucher Type creation/Alteration Tally will print the voucher immediately after saving. Receipt Voucher The receipt voucher in Tally is for all receipts into the Cash/Bank account. The voucher is similar to the payment voucher except that you debit cash or bank A/cs and credit the ledger from which you receive. The first entry in receipt must be credit and at least one debit to a cash or bank account. There can by any number of debit and credit entries. If you do not debit one Cash or bank account, a message appears asking you to rectify the entry. If you have given Yes to 'Print After Saving Voucher?' in Voucher Type creation/Alteration Tally will print the voucher immediately after saving. Alternatively you can print any voucher later by going to Voucher Alteration screen using Display menu. Open the voucher and press Alt-P to display the 'Print
Voucher' Screen. Give 'Y' to the Print? Prompt. Sales Voucher The first entry must be a debit involving any debtor, bank or cash account and second should be a credit to ledger placed under sales account group. Rest of the accounts may be any Revenue account or any account under the Group current liabilities. Thus you can include Duties & Taxes from 3rd entry onwards. Purchase voucher The first entry must be a credit involving any creditor, Cash or Bank account and second entry should be a debit to a ledger placed under purchase account group. Rest of the accounts may be any revenue account or any account under the Group Current Liabilities Contra Voucher The contra voucher is for Fund transfers between cash and Bank accounts only. The following is the rule, For example, If you pay Rs. 10000 cash into State bank Account. Your contra entry should be like this, Particulars Debit/credit Cr. Cash Credit - 15000 Dr. State bank ac Debit - 15000 Credit Note: Credit Note is raised when a buyer returns some goods that you sold him. or you give him credit due to rate difference or discount/rebate or when there is an exces debit to any party Debit Note: You create a Debit Note when you make purchase return or when you have short billed a customer or you are granted credit by your supplier due to rate difference, discount etc. Memo Voucher This is purely Non-accounting voucher. These entries will not affect your accounts nor does affect your final results. You can alter and convert a Memo Voucher into a regular voucher when you decide to bring the entry into your books. You can use memo vouchers to make suspense payments, vouchers not verified at the time of entry, Items given on approval.
Exercise: 5
Journalize the following:
No Date Transaction 01 01-02-2004 Maruthi & Sons Started business with capital of Rs. 2,00,000 02 02-02-2004 Paid into Indian bank Rs. 50,000 03 03-02-2004 Bought goods for cash 14,700 04 06-02-2004 Sold good to JJ Traders on Credit 7,000 05 09-02-2004 Cash Sales 19,000 06 11-02-2004 Received Commission 400 07 13-02-2004 Received seven tables from Amirtha Stores at 500 each 08 15-02-2004 Bought goods from Vignesh 2,000 09 21-02-2004 Paid cash to Amirtha Stores 10 26-02-2004 Paid rent 1,000 11 27-02-2004 Paid Salary 2,500
Exercise : 6
Journalize the following: No Date Transaction 01 03-07-2004 Peter started business with Rs. 75,000 02 05-07-2004 Goods purchased 6,000 03 10-07-2004 Good sold Rs. 8,000 04 15-07-2004 Goods purchased from Mathew Rs. 21,000 05 17-07-2004 Goods sold to Sanjay Rs. 24,000 06 18-07-2004 Goods returned to Mathew Rs. 1,300 07 20-07-2004 Goods returned by Sanjay Rs. 500 08 23-07-2004 Opened an account with HDFC Bank Rs. 15,000 09 25-07-2004 Drew from Bank Rs. 4,000 10 25-07-2004 Furniture purchased Rs. 3,500 11 27-07-2004 Sanjay settled his account 12 28-07-2004 Settled Mathew’s Account 13 29-07-2004 Insurance Premium paid Rs. 350 14 29-07-2004 Electric Charges paid Rs. 250 15 30-07-2004 Drew for Personal use Rs. 1,300 16 31-07-2004 Salary paid Rs. 1,500
Exercise: 7
Journalize the Following with invoice: HS & Co started the business from 01/04/2004 01/04/2004 Received capital by cash 2,00,000 01/04/2004 Cash Deposited in HDFC Bank 50,000 04/04/2004 Credit purchases from Kiran Traders 20,000 (Inv.No. 122) 04/04/2004 Credit purchases from Pooja Traders 20,000 (Inv.No. 433) 11/04/2004 Credit purchases from Kiran Traders 20,000 (Inv.No. 144) 11/04/2004 Credit purchases from Pooja Traders 20,000 (Inv.No. 444) 11/04/2004 Returned Goods to Kiran Traders 5000 (Inv.No. 122) 13/04/2004 Returned Goods to Pooja Traders 5000 (Inv.No. 444) 16/04/2004 Credit Sales to Ram & Ram 50,000 (Inv.No.1) 16/04/2004 Credit sales to Kavitha & co 50,000 (Inv.No. 2) 16/04/2004 Cash Sales 20,000 (Inv.No. 3) 18/04/2004 Credit Sales to Ram & Ram 50,000 (Inv.No.4) 18/04/2004 Credit sales to Kavitha & co 50,000 (Inv.No. 5) 18/04/2004 Goods returned by Ram & Ram 5,000 (Inv.No.1)
18/04/2004 Goods returned by Kavitha & co 5000 (Inv.No. 5) 21/04/2004 Payment made by cheque to Kiran Traders 30,000 Ch. No. 161122 21/04/2004 Payment made by cheque to Pooja Traders 30,000 Ch. No. 161123 21/04/2004 Received cheques from Ram & Ram 75000 Ch. No. 320321 21/04/2004 Received cheques from Kavitha & co 75000 Ch. No. 112310 Payment Made by cash: 26/04/2004 Paid to Petty cash by cash 1,000 26/04/2004 Furniture purchased 20,000 26/04/2004 Salaries paid 10,000 26/04/2004 Rent 4,000 26/04/2004 Electricity charges 3,000 26/04/2004 Telephone charges 3,500 26/04/2004 Cash Purchases 5,000 Payments Made by Petty Cash: 30/04/2004 Conveyance 150 30/04/2004 Postage 100 30/04/2004 Stationeries 200 30/04/2004 Staff Welfare 100 30/04/2004 Stationeries purchased from Jain & Co 1500 on Credit 30/04/2004 Depreciation on Furniture 10% Answer: Balance Sheet Total Rs. 3, 21,950
Memorandum Exercise: 8 25 Apr 2007 Paid advance in Travailing Rs.10000 27 Apr 2007 Paid salary advance Rs.3000 01 May 2007 Paid salary Rs.3000 against advance 05 May 2007 Paid Traveling exp Rs.8900 against advance 25 May 2007 Paid rent Advance Rs.5000 02 June 2007 Paid rent against advance Voucher Types:
By default Tally 9 provides 18 types of Vouchers (with out counting payroll vouchers) for recording different natures of transactions. However, if you require further Voucher Types that function like the one of the existing type, you can create New Voucher Types and give different Voucher Numbering series. The Voucher Type facility is great as you can make several alternates of each pre-fixed Voucher Type. For example, for Sales Voucher, it may be convenient to have several Voucher Types like Cash Sales, Credit Sales, Sales To Registered Dealers, Sales to Unregistered Dealers, Export Sales, etc. By creating separate voucher types for them, you can independently configure their numbering scheme, layout, etc. Voucher Number: To identify a voucher uniquely, normally every voucher is given unique
number. The number may be allotted by the user, or can be automatically generated by Tally, according to options set in voucher Types under Accounts Info. Tally provides three options for voucher numbering 1) Automatic 2) Manual 3) None If Automatic is opted for the selected Voucher Types, Tally allots incremental number and cursor would not move here. And we cannot change the voucher number. If Manual is specified for the selected voucher type, cursor would blink at the voucher number field to input from keyboard. We can modify the voucher Number If none is opted for the selected Voucher Type, voucher number field would not appear.
Features Tally controls operational Features through F11: Features button. F11:Features button appear almost in every screen upon selecting a company. We get same option irrespective of screen where we launch it. Feature settings are company specific. We can activate an option for one company and deactivate the same for another company.
Accounting Features - 11
1. Integrate Accounts and Inventory: This option basically affects accounts. If we set this option to Yes, the value of stock is automatically computed on the basis of Inventory and posted in Balance sheet, Profit & loss a/c and we are not allowed to input the stock value on our own as the accounts are integrated with the Inventory Part. If we set No, our Accounts & Inventory remains separate and we have to input the value of closing stock in the ledger under Stockinhand group which is posted in the Balance Sheet & Profit & Loss A/c. 2. Income /Expense Statement Instead of P & L: We change Profit and Loss A/c to Income and Expenditure statement. By default, Profit & Loss A/C 3. Allow Multi Currency: If we wish to record transaction in foreign currency, we should set this option to yes. On setting this feature to yes, Currency option would be available at Accounts Info menu and in ledger creation we can specify currency for the ledger. In case we do not need foriegn currency option, we should respond No, that would keep, Accounts Info menu and ledger creation screen tidly. 4. Maintain Billwise Details: By default, Tally would maintain ledger wise balance and display net debit or credit balance for a ledger. If we receive or grant credit on purchase or sales, mere ledger balance may not reflect the true state of affairs-as a ledger may show an amount due which may not be over due on that date. By maintaining Bill wise details, we can get bill wise
outstanding ,compute bill wise overdue interest , In case we need these features, respond Yes to this option that would allow to selectively option to maintain Bill Wise Details for ledgers. In case mere ledger balances is sufficient to meet our requirement. Respond No to keep the ledger creation screen more sleek. 5. Maintain Cost Centres: If we wish to make cost centre wise allocation, respond Yes that would activate Cost Centres option which we would get in Accounts inof menu 6. More than One cost Category: If we respond Yes to the above option, we are asked this question. If we wish to allocate a transaction to more than one set of cost centres simultaneously, respond Yes that would activate Cost Category option under accounts info menu and we would be able to allocate to multiple set of cost centres. 7. Interest Calculations:Interest is re-calculated with every change in balance outstanding. The Cr in the interest amount should not be confused to mean an Income. It only means that it is payable and is a liability. 8. Maintain Payroll: If we set this option to yes, we can create a employee pay slip. 9. Allow Invoicing: If we set this option to yes, we can enter sales transactions in Invoice mode also if we respond No, we will ne restricted to enter sales transactions in voucher mode only. 10. Maintain Budgets and Controls: If we wish to use Budget to compare with actual or other budgets and get variance or set Credit Limit for party,set this feature to yes. When we set this feature to yes, Budget option would be avaliable at Accounts info and Credit Limits under Accounts Info-Ledger menu. In case we do not need to use Budgets or credit limits, set to No. 11. Use Reversing Journals & Optional Vouchers:If we set this option to yes, It would be enable to voucher entry. 12. Allow Zero valued entries: If we need to make Voucher entires whose monetary transaction value is 0, respond yes (For example, to prepare an Invoice for sample of zero value), otherwise respond No. 13. Enable Cheque printing : You can choose to write cheques directly from Tally. Cheques will be printed when printing a Payment Voucher. However, first activate the capability and set dimensions
Multi-Currency Organizations who transact in multiple currencies need to record transaction in the currencies they transact with. We can create and transact in any currency. We can also enter selling and buying rate of different currencies. F11- Features→ Allow Multi currency Yes Once this option is said to yes we get currencies under accounts info. Select currencies → press enter The currencies menu has the usual create, display and alter options. Symbol : Enter currency symbol
Formal Name : Enter the name of currency, must be different from the symbol. Number of Decimal places : Enter the number of decimal places for the Currency.
Rate of Exchange:
Thee screen always comes up in Alter mode. Rate of Exchange: It operate on day-to-day Standard Rate : The standard rate is used to calculate variances from The actual transaction rates Selling Rate : Enter the rate at which we are selling the currency to our money exchange. Buying Rate : Enter the rate at which we are buying the currency from our Banker or Money Exchanger. Come to voucher entry → Press F5 → Payment → Payment is made to Krishna Traders in Dollars that is 50 dollars. The entry is passed as shown below : Once enter is pressed in the amount column the Dollar gets converted to Rupee as on the date of voucher Entry as shown below and the amount is displayed based on Rupee currency. Exercise: 9
Mr. Laxman started a business in the name of Laxmana Traders on 1/5/2005 02/5/2005 Received capital from Murali 1000 Dollars. 02/5/2005 Standard rate Dollars 67,68,65 03/5/2008 Purchased items from Vimal & co for 150 Dollars 03/5/2008 Standard rate Dollars 61, 63, 60 06/5/2008 Sold goods to Raja & Raja for 75 Dollars 06/5/2008 Standard rate Dollars 46, 48, 47 08/5/2008 Received 70 Dollars from Raja & Raja 08/5/2008 Standard rate Dollars 58, 59, 57 Exercise: 10
Create currencies for the following: Standard Selling Buying Rate Rate Rate $ (Dollar) 62 63 60 # (Frank) 45 47 46 £ (Pound) 72 73 72 ¥ (Yen) 58 60 59 € (Euro) 82 83 82 1.2.2004 Sathesh Started business with Rs. 5,00,000 01-02-2004 Opened Current Account in HDFC Rs. 25,000 03-02-2004 Bought goods from Levi Traders $200 06-02-2004 Sold good to Jagan Traders on Credit £150 09-02-2004 Goods Purchased from Mahila & Co ¥100 11-02-2004 Furniture purchased £500 13-02-2004 Goods returned to Mahila & Co ¥15 15.2.2004 Bought goods from Vinita & Sons €100
21-02-2004 Settled Mahila & Co Account 26-02-2004 Paid rent 1,000 27.2.2004 Paid Salary 2,500 27.2.2004 Sold to Peter Steel Enterprises € 200 28-02-2004 Peter Steel Enterprises settled his account. 28-02-2004 Drew from Bank Rs.10, 000
Cost Categories and Cost Centres By providing cost centre, a transaction can be allocated to it which would then enable extraction of all transactions for a cost centre. Hence, a cost centre can be said to be any unit of an organization to which transactions can be allocated when only costs or expenses are allocated to these units; they are referred to as cost canters. F11-Featrues→ Set yes to two options Maintain Cost centre yes More than one Cost Category yes Steps Involved: Cost Categories → Single → create Name: Department Allocated Revenue Items: yes Accept → yes Cost Centre→Multiple Cost Centre →Create Under Cost Centre: All items. In Category Column → Select Department Under Name of Cost Centre → Type the different types of Cost Centres Accept → yes Come to voucher Entry Press F5 → Payment and enter the following entry By Salaries Rs. 45,600 Once we press enter we get the following screen, select Cost Category, then select cost centres and type the salary amount incurred for the different departments as shown below: Type to cash → Type the Narration → Accept Yes
COST CENTRE CLASS
Cost Centre Classes affect all voucher types. In voucher entry, the allocation screen would not appear, but allocation would be made automatically.
Steps Involved:
1. Press F11 -> Features -> Maintain Cost Centres and more than one cost category options should be set to Yes. 2. press F11 -> Features -> Pre-defined cost centre allocation during entry set Yes. 3. The following screen appears. 4. Type a Class name, say Expenses Allocation . Press Enter the
following screen appears. 5. Select the name of the cost category as Department , select Cost Centres and type the Percentage of allocation for each department. The percentage should be typed by us. Press Enter Accept Yes. 6. Come to Voucher Entry. Press F5 -> payment -> Under Cost Centre Class -> Select the name of the class as Expenses allocation. Then pass the entry. To view the Allocation of Expenses under different Cost Centre: Display -> Statements of Accouts -> Cost centres Exercise No: 11 Cost Category: Chennai Cost Centre: Marketing, Finance, Administration 01/4/2005 Paid Salary Rs.28, 000 (M-10, 000, F-10, 000, A- 8,000) 03/4/2005 Paid Rent Rs. 8, 000 (M-2, 300, F- 2,200, A- 3, 500) 17/4/2005 Paid Stationeries Rs. 3,000 for all departments 24/4/2005 Paid Electricity charges Rs. 12,000 (M-4, 000, F- 3,500, A- 4,500) 30/4/2005 Paid Sales Tax Rs. 1,650 for all departments 01/4/2005 Paid Income Tax Rs. 1,800 for all departments Exercise No: 12 Cost Category: Department Cost Centre: Account, Purchase, Sales, Computer Date Expenses Accoun t Purchas e Sale s Compute r Total 03/5/05 Electric Bill 2000 2000 1400 5000 1040 0 05/5/05 Rent 1500 1500 300 3000 630 0 07/5/05 Interest 500 200 150 85 0 05/5/05 Wages 500 200 70 0 09/5/05 Stationery 250 50 12 0 100 52 0 13/5/05 Salary 4500 2000 3000 4000 1350 0 25/5/05 Postal Charge 400 150 55 0 27/4/05 Telepone
Bill 1300 300 200 1500 330 0
Bill-Wise Details By activating the Bill wise feature in F11: Features, the ledger masters under Sundry Debtors and Sundry Creditors automatically displays an additional option called Maintain balances bill-by-bill. On setting this option to Yes, you get an additional option Default Credit Period. When you enter details of sales and purchases with Bill-wise turned on, Tally prompts you to identify the invoice with an appropriate reference number. The reference can then be used to allocate payments to the correct invoice to maintain an accurate account of outstanding. Bill-Wise Types: New Ref: To enter new credit purchase or new credit sales value Advance To settle payment or receipt before purchase or sales Against Ref: To settle payment or receipt against purchase or sales On Account To settle an opening balance to study party Creation of Bill_Wise_Details: F11: Accounting Feature: Maintain Bill-wise Details? Yes (for Non-trading A/c s also) No Ledger creation: Purchase → Purchase A/c Ram & Co → Sundry Creditor Voucher Creation: Gateway of Tally→Accounting Voucher Report: Go to Gateway of Tally > Display > Statements of Accounts > Outstanding> Receivables/Payables.
Exercise No: 13 Capital 2, 50,000 Sundry debtors Milky (P)Ltd 5160 Bill No Date Amount Due days S/01-02/301 27/01/02 1430 30 S/01-02/304 26/02/02 1730 30 S/01-02/309 27/03/02 2000 45 Sundry Creditors Praveen & Sons 7050 Bill No Date Amount Due days C/01-02/1248 26/01/2002 1500 30
C/01-02/1252 21/02/2002 4050 30 C/01-02/1282 25/03/2002 1500 45 Fixed Assets Furniture 30,000 Computer 40,000 Opening Stock 10,000 Cash in hand 70,000 SBI 1, 01,890 Voucher Entry: Sales bill Milky (P)Ltds Bill No Date Amount Due days 202 30/04/02 1430 30 214 15/05/02 1500 30 256 31/07/02 3640 15 301 28/10/02 2750 351 25/10/03 5050 45 392 15/03/03 11000 45 Kamal & Co Bill No Date Amount Due days 417 12/04/02 2230 15 431 16/05/02 2650 15 452 17/08/02 5630 30 515 15/11/03 10780 45 659 21/01/03 1530 815 30/03/03 2130 30 Purchase bills Praveen & Sons Bill No Date Amount Due days 0001 03/04/02 455 0002 05/05/02 1000 15 0003 16/08/02 1675 30 0004 22/11/02 4050 30 0005 31/03/03 12350 45 Malar & Co 0006 02/02/03 11450 30 0007 15/02/03 5540 15 0008 24/02/03 875 15 0009 31/03/03 1234 30 Received cash Milky (P) Ltd Bill No Date Amount 304 02/05/02 1730 214 17/06/02 1500 301 01/11/02 2750 351 31/03/03 4000
Kamal & co 417 30/4/02 2230 452 20/8/02 5000 515 31/1/03 10000 659 25/1/03 1530 Payments Made Praveen & Sons 1282 15/5/02 1500 0001 4/4/02 455 0004 20/9/02 4050 0005 30/3/03 12000 Malar & Sons 0006 5/3/03 10,000 0007 15/3/03 5,540
Interest Calculations The Activate Interest Calculation field is displayed in the Ledger Creation screen only if Activate Interest Calculations is set to Yes in F11: Features. Set this field to Yes for each specific ledger account for which interest is to be calculated. Simple Mode (Where advanced parameters are not applicable) To calculate Interest in the Simple Mode: 1. Go to Gateway of Tally> F11: Features > Set Activate Interest Calculation to Yes. > Set Use Advanced Parameters to No. 2. In the Ledger Creation screen set Activate Interest Calculation to Yes. 3. The Interest Parameters sub screen is displayed. Enter the Rate and select the interest style from the list. Interest calculation transaction by transaction Interest calculated on Outstanding Balances. 1. Go to Gateway of Tally> Accounts Info.> Ledgers> Alter (Single)> Bank Ltd (bank account) 2. Set Activate interest Calculation to Yes. 3. Rate: 15%. 4. Interest Style:. Of the four options, select 365-Day Year. 5. Accept the screen. The Interest Calculations Report can be displayed and printed. Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculations> Ledger> Bank Account Interest calculation transaction by transaction 1. Alter a Customer account 2. Set Activate Interest Calculation to Yes. 3. Set Calculate Interest Transaction-by-transaction to Yes.
4. Set Over-ride Parameters for each transaction to No. To view the Interest calculated Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculations> Ledger> Advanced Mode ( Where advanced parameters are applicable) The advanced parameters are particularly useful where interest rates change from time to time. 1. Go to Gateway of Tally> F11: Features > Accounting Features > Set Activate Interest Calculation to Yes. > Set Use Advanced Parameters to Yes. 2. The Interest Parameters sub-screen is displayed • For Ledgers created under the Group Sundry Debtors/Sundry Creditors, the Interest Parameters sub-screen is displayed as shown below: • For Ledgers created under the Group Bank Accounts, or if the option Calculate Interest Transaction by Transaction is set to No, then the Interest Parameters sub-screen is displayed as shown below To view the report on Outstanding balances: Go to Gateway of Tally> Display> Statements of Accounts.> Interest Calculations> Ledgers> Bank Ltd. Advanced Parameters - Interest calculation transaction by transaction: Activate and specify interest calculations in ledger masters. Advanced Parameters - Interest calculation transaction by transaction Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculation > Ledger>X a/c Exercise: 14 1.6.2004 Capital Rs. 1,50,000
2.6.2004 Purchased goods from Raabiya Traders for a sum of Rs.75,000 [Credit period is 45 days, Bill no.24] Interest Rate 12% and 15% 6.6.2004 Sold goods to Kamalam & Co for a sum of Rs. 1,25,000 [Credit period is 45 days] Interest rate 13% and 18% 2.12.2004 Amount paid to Raabiya Traders plus the interest rate. 3.3.2005 Amount received from Kamalam plus the interest rate. Display the interest calculations from 1-06-2004 to 31-03-2005
Budgets
Budgets are used to set targets and compare against actual and get variances. We can create multiple budgets for different purpose.
Press F11-Accounting Features → Maintain Budgets and Controls- set yes Creation of Budgets: Gateway of Tally → Accounts Info → Budgets→ create On selection of create option, we get a screen as shown below Name : Enter a name of the Budget for identification Under : Primary Period of Budget : Given the period range of the Budget in the Columns From and To Press Enter → Under Ledgers → Type yes, the next screen appears and type the contents as shown below: Account Name : Name of the Group or Ledger for which the budget is created. Cost Centre : Not applicable Type of Budget : We get 2 options to select the type of Budget, namely 1. On Nett Transactions 2. On Closing Balance On Nett Transactions: This option is suitable for accounts where nett transactions are to be monitored (eg. Revenue A/C) On Closing Transactions: This option is suitable for accounts where closing balance is to be monitored (eg. Personal A/C) Press Enter→ Enter→ Accept yes. Budget has been created. To view the Budget, Go to Gateway of Tally → Display → Trial Balance → Press Alt + B → Budget Variance→ select the name of the Budget→ Press Enter Exercise: 15 Expenses Budget Conveyance 5,400 Wages 50,000 Carriage Outwards 500 Electricity Expenses 3,000 Advertising 2,000 Selling and Distribution 1,500 Enter the following entries for Budget and Controls May 2005 Paid Conveyance 200 Paid Wages 500 Paid Carriage Outwards 2,500 Paid Electricity Expenses 3,000 Paid Advertising 2,000 Paid Selling and Distribution 1,100
June 2005 Paid Conveyance 500 Paid Wages 250 Paid Carriage Outwards 1,500 Paid Electricity Expenses 2,000 Paid Advertising 2,000 Paid Selling and Distribution 1,220
Bank Reconciliation
Bank Reconciliation means that the accounts maintained by the banker tallies with the bank ledger account in our Books. Even if both the accounts are in sync, the balances may not be equal for various reasons. Bank Reconciliation is the process to ensure that even if these two balances apparently differ, the bank Pass Book is in sync with the Bank Book in the books of accounts. Steps Involved: 1. Our current account statement has been sent to us by our Bank for the month ended may 2005 2. Bring up the monthly summary of Current Account (Display→Account Books→Bank Books and select the bank Account) 3. Bring the cursor to May and Press Enter. This brings up the vouchers for the month of May 2005 4. It is helpful to see the Narration as that contains cheque numbers and other details. So Press F12: Configure and activate Show Narration. 5. Since this is a Bank Account, an additional button F5 Reconcile will be visible on the right. Press F5 6. The display now becomes an Edit screen in reconciliation mode. The primary components are: • A Column for the Banker’s Date • The Reconciliation at the bottom of the screen, Showing: Balance as per Company Books, Amounts not Reflected In Bank and Balance as per bank 7. Enter the bank date for the payment voucher and contra voucher. 8. The next time we come for reconciliation, we will be presented with only those vouchers, which remain unreconciled. Exercise: 16
01/4/2005 Received Capital by Cash 1,00,000 02/4/2005 Cash deposited in SBI 50000 Deposit Slips 05/4/2005 Kiran 45000 07/4/2005 Sanjaj 25000
10/4/2005 Kavi 20000 11/4/2005 Kiran 20000 15/4/2005 Kavi 15000 Counter Foils 08/4/2005 Kavitha 15000 09/4/2005 Sachin 5000 11/4/2005 Amutha 7500 12/4/2005 Sachin 10000 15/4/2005 Amutha 4500 17/4/2005 Kavitha 12000 30/4/2005 Bank Charges 250 Pass Book of SBI as on 30/4/2005 Date Name Deposits (Dr) Withdrawal (Cr) Balance 02/4/05 Cash 50000 50000 Cr 06/4/05 Kiran 45000 95000 Cr 09/4/05 Sanjay 25000 120000 Cr 10/4/05 Kavitha 105000 Cr 13/4/05 Amutha 7500 97500 Cr 14/4/05 Sachin 10000 87500 Cr 17/4/05 Kavi 15000 102500 Cr 30/4/05 Bank 250 102250 Cr Exercise: 17 Jeevan & Co Started business on 1/4/2004 1/4/2004 Received capital by Cash Rs. 50,0000 1/4/2004 Cash deposited in Canara Bank Rs. 20,000 Following is the details of Deposit Slip (Sundry Debtors) 10/4/2004 Kabir 40,000 12/4/2004 Usha 25,000 14/4/2004 Syam 20,000 25/4/2004 Usha 15,000 29/4/2004 Kabir 10,000 Following is the details of counter Foil of Cheque Book (Sundry Creditors) 11/4/2004 Ashima Textiles 12,500 13/4/2004 Fashion Textiles 3,350 15/4/2004 Silky 5,000 17/4/2004 Ashima Textiles 10,000 19/4/2004 Fashion Textiles 5,000 28/4/2004 Silky 3,000 30/4/2004 Bank Charges 100 Date Name Deposits (Dr) Withdrawal (Cr) Balance 01/4/2004 Cash 20,000 20,000 Cr 12/4/2004 Kabir 40,000 60,000 Cr 13/4/2004 Ashima Textiles 12,500 47,500 Cr 14/4/2004 Usha 25,000 72,500 Cr 15/4/2004 Fashion Textiles 3,350 69,150 Cr
17/4/2004 18/4/2004 26/4/2004 30/4/2004
Silky 5,000 64,150 Cr Ashima Textiles 10,000 Usha 15,000 69,150 Cr Cheque Book 100
Optional and Post-Dated Voucher This is another non-accounting voucher. Unlike a Memo voucher, this is not a separate voucher type. You can mark an existing voucher (for example, a payment voucher or a receipt voucher) as Optional. Press CTRL + L or click on Optional from the Button Bar. This button toggles with Regular. By marking a voucher Optional, the voucher does not get posted anywhere but remains in the Optional Register. You can make a voucher type default to Optional if you need to create a new voucher type or alter an existing voucher type. Go to Gateway of Tally > Accounts Info > Voucher Types> select a Voucher Type> Set Make Optional as default to Yes. Enabling Optional Vouchers 1. Go to Gateway of Tally 2. Select F11:Features > Accounting Features to display Company Operations Alteration screen 3. Set Use Rev. Journals & Optional Vouchers? to Yes. 4. Accept the screen to save. Use of Optional Vouchers • If you do not want a transaction that is incomplete to affect the accounts, you can mark this as an Optional Voucher. Once the transaction is complete, modify the voucher and post it as Regular Voucher. For example, Performa sales invoice. In fact, an optional sales invoice prints as a Performa Invoice. • Optional Vouchers allow you to see the impact of transactions without actually posting them. • Optional Vouchers can be used to forecast future sales. For example, create a New Voucher Type - Sales Forecast. Record future sales projections using this voucher type. Let us consider the following example. On 30th June you want to view the Balance Sheet as of today but June rent is not due for payment until the first week of July. This liability is not reflected in the Balance Sheet. To overcome this, enter an Optional Voucher dated 30th June. The above entry is made as shown below 1. Enter Date 2. Select Optional from the button bar 3. Debit Rent account
When you view the Balance Sheet, generate a report with the Optional Voucher included. The Optional Voucher should be already defined as a Scenario (Refer section on Scenario Management for more details). The voucher affects the report temporarily. Once you quit the report, Tally does not retain the Scenario details. The next time you view the balance sheet, it will not include the effect of the Optional Voucher unless you include it.
Post-Dated Vouchers While entering vouchers, you can mark them as post dated. Tally will not update the vouchers in ledgers until the specified date is approached. This is useful to enter transactions that take place on a regular basis. For example, if you pay for something by installments, you can set up the payments in advance, and Tally will only enter them in the ledgers as they fall due. Mark vouchers Post Dated by using CTRL + T or click on Post dated button from the Button Bar. This button toggles with Current.
Accounting with Inventory Inventory accounting includes recording stock details, the purchase of stock, the sale of stock, stock movement between storage locations/ godowns and providing information on stock availability. With Tally it is possible to integrate the inventory and accounting systems so that financial statements reflect the closing stock value from the Inventory system. The Inventory system operates in much the same way as the accounting system. First we set up the inventory details, which is a similar operation to creating the chart of accouts although , in this case there is no pre-defined set of stock groups. Second, we create the individual stock items. which is similar to setting up the ledgers. Finally, We are ready to use vouchers to record the various stock transactions.
Stock items:
Stock items are the actual items in stock, and we account for the issued and receipts of stock at this level.
Stock Groups: We classify stock items into stock group based on any common feature.
Stock Categories:
This is a useful Tally feature, Which allows us to classify similar stock items together across different stock groups, enabling us to obtain reports on alternatives or substitutes for a stock item.
Locations/Godowns: We can specify where the stock items are held, e.g., which warehouse shelf or rack, obtain stock reports for each Godown, and account for movement of stock between locations/Godowns.
Units of measure: We will need to create units of measure for stock items. These can be simple units such as nos, metres, kilograms, pieces, or compound units, e.g., box of 10 pieces or 1 dozen is 12 nos.
Maintain Accounts with Inventory
Tally displays a pop-up list called Type of Company – this is how your books of accounts will be maintained.
Accounts only Select this only if you do not have any inventory transactions (suitable for professionals and corporate offices). Tally would not permit intrusion ofInventory related information that are not required. However, at a later date (if required) you can alter the information as Maintain Accounts-with-Inventory – Tally accordingly now provides all the inventoryrelated information.
Accounts-with-Inventory
This obviously allows you to maintain both financial accounts and inventory. You may choose not to use one or the other until the need arises.
Stock Groups 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. Your stock items could then be Sony 3.5" disks, Sony tapes, etc. Classify the Sony products under the Stock Group Sony. Creating Single Stock Group: Gateway of Tally→Inventory Info→Stock Group→Single Stock Group In the Name field→ Enter Sony In the under field → Select Primary Can Quantities of Items be Added? Set yes Check the data is correct and press enter and Accept – Yes
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. Can quantities of items be ADDED? Field allows us to specify if it is logical for totals of stock-in-hand to be displayed for this group heading in Stock Summary.
Creating Multiple Stock Group:
• Select Create in multiple Stock groups to bring up the multi stock group creation screen. • Select group name from the Pop-up list of Groups for the Under Group field. • In Name of Stock Group type and enter sub group name. • In the next line type another group name and Accept -> yes.
Displaying and Altering Stock Groups
Once created, stock groups can be displayed and altered in single and multiple mode. We can delete a stock group via single Stock group alter by pressing +. However. we cannot delete a stock group with subgroups or stock items.The lower levels must be deleted first
Delete a Stock Group
Note:You can delete a stock group only if it does not have any children under it. The children could be stock group or stock item or both. Gateway of Tally—>Inventory Info—>Stock Groups—>Single Alter Press [ALT]+[D]to delete the stock group You cannot delete a stock group from multiple mode.
Stock Categories: Stock Categories offers parallel classification of items. You may create Stock Categories like Floppy Disks and Floppy Drives. Require information like total stock of floppy disks or alternative items that could be used, these would be best available through Stock Categories. F11 Features: Maintain Stock Categories – Yes
Creating Single Stock Category: Gateway of Tally > Inventory Info > Stock Categories In the Name field→ Enter Floppy Disks In the under field → Select Primary
Creating Multiple Stock Categories
• Select create in multiple mode to bring up the multi stock category creation screen. • Select any one stock categories from the list of categories. Type and enter sub stock categories. • Press Enter twise to accept the data and return to the stock categories menu.
Display or Alter a Stock Category
Gateway of Tally—>Inventory Info—>Stock Categories—>Single/Multiple Display Or Gateway of Tally—>Inventory Info—>Stock Categories—>Single/Multiple Alter Select the stock category whose particulars you wish to display. When you display or alter a stock category, the information entered while creating it is displayed. • Display from this mode is for master information only. You will not obtain any
balances for a stock category here. Use the Display option from the Gateway of Tally for display of balances and transactions. • In earlier days of computing, one would look at the master information for balances. Tally believes that balances are a logical consequence of the transactions; hence, they should be available with the transaction summaries. You would find all summaries and details through the Display option in the main Gateway of Tally.
Delete a Stock Category
You can delete a stock category only if it does not have any children under it. The children could be stock category or stock item or both. Gateway of Tally—>Inventory Info—>Stock Categories—>Single Alter Press [ALT]+[D]to delete the stock category
Units of Measure You will need to create units of measure for stock items. These can be simple units such as numbers., metres, kilograms, pieces, or compound units, e.g. box, where, say, one box equals ten pieces.
Create a Unit of Measure
There are two types of Unit of measure: 1. Simple 2. Compound Select Units of measure from the Inventory info menu and select create the Units menu to bring up the unit creation screen. In symbol type and enter nos. in formal name type and enter Number of press Enter twice to accept the data without quitting from the unit creation screen. Gateway of Tally—>Inventory Info.—> Units of Measure—> Create In Symbol type ad enter doz. In Formal Name type and enter Dozen. Press Enter twice to accept the data. Use the up arrow or backspace key to position the highlight in the Type field. Select Compound form the types of units Pop-up menu. Select doz as the First Unit. Type and enter 12 as the conversion factor. Select nos as the Second Unit and accept the data. Press enter to return to the units menu.
Displaying and altering units of measure Gateway of Tally > Inventory Info. > Units of Measure > Display/Alter Once created, units of measure can be displayed and altered. You can delete a unit of measure in the alteration screen by pressing [Alt]+[D]. However, you cannot delete a unit of measure that is part of a compound measure. The compound measure must be deleted first.
Godown Godown is the place to store goods. Tally allows us to create any number of Godown and nest into any number of levels. F11 Features: Maintain Multiple Godowns? Yes
Creating single Godown: Gateway of Tally > Inventory Info. > Locations > Create
Name
In the Name field, give the name of the location.
Address
Give a address of the godown, if required.
Under
Give the location under which this location is to be sub-grouped. Use [alt]+ [C] to create the parent location. Select primary if it is not a child of any location.
Allow Storage of Materials? Tally permits you to create a location/godown where you may not store materials at all but treat it as a virtual location. Virtual location are useful in case like Head Office which may have many different stock points under it that store materials. Hence, Head Office acts like a primary group location. Or , for example, designate London as a virtual location with Wimbledon Warehouse, Harrow Warehouse, Brixton Warehouse as sublocations/ godowns. These sub-locations or godowns will allow storage of materials.
Displaying and altering stock godowns
Once created, stock locations can be displayed and altered in single and multiple mode. You can delete a stock location via Single Location Alter by pressing [Alt]+[D]. However, you cannot delete a stock location with sub- locations. The lower levels must be deleted first.
Stock Item Stock items are the actual items in stock, and we account for the issued and receipts of stock at this level. Stock items are the actual items in stock, and we account for the issued and receipts of stock at this level. Creating Stock Item: Gateway of Tally→Inventory Info→Single Stock Item In the Name field→ Enter Sony Disks 3.5” In the under field → Select Sony In the unit field → Box of 100 Nos.
Delete a stock item
You can delete a stock item only if it has not been used form transaction entry. Gateway of Tally > Inventory Info > Stock Items > Single Alter Press [ALT]+[D] to delete the Stock Item
Stock Group Exercise No: 18 a) Journalize the following Transaction in the Book of Anandha Stores 2007 Aug 01 Anand Started the business Rs.7,00,000 08 Anand Deposit into the Indian Bank Rs.25,000 10 Purchase 100 kg Ponni Rice per kg Rs.20.50 19 Purchase from Rasi Stores 200 kg Ambai 18 per kg Rs.17 Sep 02 Salary for staff Rs.4,500 05 Paid Rent for Rs.5,000 15 Purchase 50 lit Gingilly Oil per lit Rs.98 17 Purchase 300 Hamam soap (100g) per soap Rs.13 Paid Stationery Rs. 450
20 Paid to Rasi Store for Rs.3,400 Purchase from Milky & Co 125 Lax Soap per soap Rs.12 Oct 01 Purchase 75 Lit VVD Coconut Oil per lit Rs.78 05 Paid Salary Rs.4,500 15 Purchase 200 Sandal Soap per soap Rs.21 18 Sales 125 Hamam Soap (100g) per soap Rs. 15 24 Purchase 100 Hamam Soap (150g) per soap Rs.18 from Haji Store 29 Sold to Jeya Traders, 50 kg Ponni Rice Rs.22 45 kg Hamam Soap (150g) Rs.20 Nov 03 Sales Ambai 18, 50kg per Rs.18 and 75 Lax Soap per soap Rs.13 to Laxmi Store 5 Sales 10 lit VVD Coconut Oil per lit 80 6 Paid Salary Rs.4,500 12 Purchase Weight Machine Rs. 8,000 18 Sales 35 lit Gingilly Oil per lit Rs.99.50 23 Paid Telephone Bill Rs. 1,200 24 Return by Jeya Traders14 kg Ponni Rice 28 Sales 15 Hamam Soap(100g) for cash per soap Rs.15 Dec 05 Amount Settled by Jeya Traders 7 Paid to Haji Store Rs.1,000 8 Paid Salary Rs. 4,500 15 Purchase 20 lit Gingilly Oil Rs. 98 Stock Group: Rice, Soap, Oil
b) Journalize the following Transaction in the Book of Rahuman & Sons 2006 Oct 01 Started business with Capital Rs. 10, 00,000 2 Opened a Bank account in HDFC Rs. 1,00,000 5 Purchased Stationery item for Rs.5,500 6 Purchased Furniture for Rs. 23,000 7 Credit Purchased from Guru Store Inv. No. 123 Television Rs. 6,000 10 nos Fridge Rs. 8,800 15 nos Audio System Rs. 4,500 5 nos 10 Credit Purchased from ALM Traders Inv. No. 124 Television Rs. 6,500 3 nos Fridge Rs. 7,900 5 nos 11 Withdraw from Bank Rs. 5,600 for Personal use Ch.no. 098765 14 Bought a Computer for Rs.17,000 from Sai System 17 Guru Store amount settled through a cheque 18 Sold Goods for Cash Television Rs. 6,000 5 nos Audio System Rs. 4,500 3 nos 19 Paid into Bank Rs. 15,000 20 Sold Goods to Varun & Co on Credit Television Rs. 7,000 10 nos Fridge Rs. 9,000 15 nos Audio System Rs. 5,500 5 nos 22 Paid Telephone Charges Rs. 1000
23 Received cash Rs. 16,000 from Varun & Co 24 Paid made by Cash Paid to Petty Cash Rs. 2,000 Salaries Rs.10,000 Wages Rs. 7,000 Carriage Inward Rs. 1,500 26 Payment Made by Petty Cash Conveyance Rs. 200 Postage Rs. 150 Stationeries Rs. 120 Staff Welfare Rs. 200
Stock Categories Exercise No: 19 1.4.2007 Kishore Trading Company Started business with cash 80,000 4.4.2007 Paid into Bank Rs. 10,000 6.4.2007 Purchase from Uthira & Co (Inv.no. 111) Television BPL Color TV Rs. 7,000 10 nos BPL Black & White Rs. 9,000 12 nos Sony Rs. 12,500 10 nos Samsung Rs. 11,200 15 nos 9.4.2007 Purchase from Ruba & Sons (Inv. No. 122) Computer HCL Rs. 12,000 15 nos LG Rs. 10,000 10 nos 11.4.2007Credit Sales Hamsa Traders (Inv.No. 1) Television BPL Black & White Rs. 9,500 2 nos Sony Rs. 13,500 5 nos 16.4.2007Credit Purchase from Santhosh Electricals (Inv.No. 133) Fan Usha Rs. 1,000 5 nos Philips Rs. 1,200 8 nos 20.4.2007Cash Sales (Inv.No.2) Computer HCL Rs. 12,000 4 nos LG Rs. 10,000 4 nos Fan Usha Rs. 1,000 2 nos Philips Rs. 1,200 4 nos 22.4.2004Paid into Telephone Charges Rs. 1,000 24.4.2004Cash Purchase Mixci Kanchan Rs. 1,200 5 nos Preethi Rs. 1,500 5 nos Butterfly Rs. 1,000 5 nos 26.4.2004Payments Made by cash Paid to Petty Cash Rs.20, 000 Furniture Rs. 1,500 Salaries Rs.10, 000
Wages Rs. 7,000 Carriage Inward Rs. 1,500 27-4-2004 Payment Made by Petty Cash Conveyance Rs. 200 Postage Rs. 150 Stationeries Rs. 120 Staff Welfare Rs. 200
Godown Exercise No: 20 Journalize the following Transaction in the Book of Reethu Stores 01-9-2007 Started Business with cash Rs. 20,00,000 02-9-2007 Stationery Items Rs. 5,000 03-9-2007 Cash Purchases Godown Item Rate (Rs.) Pettai (kg) Town (kg) I.R. 20 18 1500 2000 Ponni 20 1000 1300 Basm ati 22 1000 1000 I.R. 8 17 2000 500 5.9.2007 Purchase from Samir Stores (Invoice No. 44) Godown Item Rate( Rs.) Junction (kg) Palay (kg) Black Gram 35 1000 1000 Green Gram 25 2500 1400 Wheat 18 1800 1500 8.9.2007 Credit Sales Laxman Traders (Invoice No. 1) Godown Item Rate( Rs.) Junction (kg) Palay (kg)
Black Gram 38.50 500 450 Green Gram 26.50 2000 750 Wheat 20.25 1000 250 10.9.2007Purchase from Kalyan Store (Invoice No. 54) Godown Item Rate( Rs.) Junction (lit) Palay (lit) VVD Coconut Oil 22 1000 1000 Idahaya Gingili oil 13 2500 1400 Sunflower Refined Oil 18 1800 1500 12.9.2007 Received cheque from Laxman Traders From 2,00,000 20.9.2007 Payment made by Cheque Samir Stores Rs. 50,000 Kalyan Store Rs. 25,000 25.9.2007 Payments made by cash Paid to petty Cash Rs. 2,000 Furniture Rs. 25,000 Salaries Rs. 30,000 Wages Rs. 25,000 Carriage Inwards Rs. 4,000 Rent Rs. 10,000 Electricity Charges Rs. 5,430 Telephone Charges Rs. 8,340 27.9.2007 Payment made by Petty Cash Conveyance Rs. 250 Postages Rs. 300 Stationeries Rs. 250 Staff Welfare Rs. 200 Vehicle Maintenance Rs. 250 General Expenses Rs. 150 30.9.2007 Depreciate 10% on Furniture
Integrate Accounts with Inventory F11: Features ->F2: Inventory Effect on Balance Sheet and Profit & Loss Account The option in F11:Features has a significant effect on the Balance Sheet and Profit & Loss Account. If set to Yes, it brings the
stock/inventory balance figures from the inventory records and provides a drill down to the Stock registers from the Balance Sheet. If it is set to No, it ignores the inventory books figures and picks up manually entered closing stock balances. Stock records often contain compensating errors caused by wrong allocation to items and the like. The feature enables finalisation of financial books without waiting for reconciliation of stocks that may take time.
Allow Zero value entries F11: Features ->F2: Inventory To use zero values in vouchers, activate the feature in F11:Company Features. There is usually no point in having a voucher that is totally without value. However, in some situations, zero values are required, for example,
Batch- wise Details Batch-wise details are given for maintaining batch information pertaining to stock items. The various options are activating batch-wise details, setting manufacturing date and expiry date. Manufacturing date and expiry date options can be used only in accordance with batch-wise details as per requirements. This is useful for business that deal in goods that have expiry dates like medicines, food and other edibles. During voucher entry, Date of manufacture of the product defaults to the date of the Voucher. Which can be changed but not to a date later than the voucher date. Expiry date cannot be a date prior to the voucher date. Tally walk - through to activate batch-wise details: 1. Return to Gateway of Tally. 2. Activate the option “ Maintain Batch wise details” in F11: Features -> Company features -> Inventory Features 3. Activate Set Expiry Dates for Batches. 4. Accept the screen. 5. From Gateway of Tally go to Inventory Info 6. Create a new stock item - Tomoto Ketchup 7. Create it under Stock Group - Ketchup (create the group if it does not exist. 8. Put it under Stock Category ‘Sauces’. 9. Activate the option “ Maintain in Batches” in that item.
10. Track date of Manufacture yes 11. Use Expiry Dates- Yes 12. Alter Standard Rates No 13. Rate of Duty 5 14. Accept defaults for other options. 15. Create a ledgerAnantha Departmental Store under sundry Creditors 16. Get back to Gateway of Tally menu an go to voucher entry. 17. Press F9: Purchase. 18. Create the following entries. 19. Date: 02-06-2008. Purchase 150 nos form Anantha Departmental Stores 120.00. Purchase Invoice number AD/001 20. Credit period 20 days. 21. After we enter item an item allocation screen will appear, here enter batch no as AD/001 having manufacturing date as 02/06/2008 and expiry date as 1/2/2009. 22. Accept the voucher. Exercise: 20 Enter the following entries for Batches and Expiry dates: 2007 May 01 Kabir invested Rs. 5,00,000 02 Paid into HDFC bank Rs. 45,000 05 Purchase Computer Rs. 16,000 06 Purchase Viva 100 nos for Rs. 260 [Batch no.V201 Expiry date 2/12/2007] Rajia & Co 8 Purchase Rin 100 gm 500 nos for Rs. 19.50 [Batch no. R301,Expiry date 1-10-2007]Mohana & Co 9 Withdraw Cash from Bank Rs. 5,000 10 Purchase Maltova 250 nos for 220 [Batch no. M202,Expiry date 1-7-2007] 11 Purchase Power Soap 300 nos for 12 50 [Batch no. P302, Expiry date 1-8-2007] 12 Paid Salary Rs. 13,000 13 Purchase La Soap 130 nos for Rs.11.50 [Batch no. L303, Expiry date 9-10-2007] Mohana & Co 14 Sales Viva 25 nos for Rs. 275 to Kavitha Store 15 Sales Rin 100 gm 230 nos for Rs. 21 to Kavitha Store 25 Purchase Liril 200 nos for Rs.22.50 [Batch no. Li302, Expiry date 11-10-2007] 28 Sales La Soap 6 nos for Rs. 12 and Liril 55 nos for 24 to Malar Traders 2007 June 02 Purchase Maltova 250 nos for 220 [Batch no. M202, Expiry date 1-7-2007] from Rajiya & Co 16 Purchase Power Soap 300 nos for 12 50 [Batch no. P302, Expiry date 1-8-2007] from Mohana & Co 17 Paid Rent Rs. 3,000 18 Paid Telephone Bill Rs. 3,400 19 Paid Salary Rs. 13,000
20 Purchase La Soap 100 nos for Rs.11.50 [Batch no. L303, Expiry date 9-10-2007] from Mohana & Co 21 Sales Maltova 25 nos for Rs. 230 to Jerry Store 22 Sales Power Soap 230 nos for Rs. 13 to Jerry Store 29 Paid Electricity Bill Rs. 2,300 30 Withdraw Cash for Personal use Rs. 1,300 2007 Sep 04 Purchase Boost 50 nos for 230 [ Batch No. B203, Expiry date 259-2009] 11 Paid Salary 13,000 13 Paid Rent Rs. 3,000 23 Sales La Soap 60 nos for 13 [Batch no. L303, Expiry date 9-102007] 24 Purchase Lux 300 nos for Rs. 15 [Batch No. Lx304, Expiry date 1111-2007] from Mohana&Co 25 Sales Lux 150 nos for Rs.16.50 to Nirupama Store
Use Different Actual & Billed Quantity This option enables you to specify quantities, that are different from that delivered, when invoicing, and record the fact. It is possible that you have delivered goods but some of them are in dispute and your customer wishes to be invoiced for only the quantity that he agrees to. He may consider the rest later and would then like to be invoiced. On the other hand, the rest is so bad that it is useless even for you to take back. Hence, you can record the fact when raising the invoice without altering the delivery note or passing a rejection entry. Select this option if you have many such occasions. Normally, the Billed and Acutal quantity is same when we set the option Use different Actual and Billed Qty to No in F11: Features. However the quantity deliverd/ received may be different from quantity billed ub same cases as: i. Free items are received or given.( Free & sold items are same. For example, 1 box of Surf Excel is given free on every 5 box of surf excel. iii. Free items are received or given. (Free & sold items are different). For example, one piece of 100gm Promise tooth pase given free on every 5 box Surf Excel. iv. The billing quantity is rounded off v. Invoicing in Part. If the Billing quantity is different from actual quantity, to enter both quantities in transaction, we need to activate option Use different Acutal & billed qty under F11: Features -> F2: Inventory . Consquently during transaction entry, we wil be prompted to enter 2 quantities, i.e., Actual and billed. Actual Quantity will update stock and Billed Quantity will be used to compute transaction value.
Exercise: 21
20.10.2006 Purchased the following items from Omega InfoTech in an sale offer made by them. The offer was that on every purchase of 5 items one item is given free. He purchased the following items and agreed to make
payment with in 10 days. Items Purchased Free of Total Rate Quantity cost Quantity Processors 25 5 30 5200 Hard Disks 20 4 24 3200 Printers 20 4 24 5100 Monitor 20 4 24 10500 UPS 20 4 24 1700 25.10.2006 Vimal introduced the sale offer and sold the following items on credit Paramount Services and Peripherals: Items Purchased Free of Total Rate Quantity Cost Quantity Processors 25 5 30 6800 Hard Disks 20 4 24 3500 28.10.2006 I – Tech Peripherals Items Purchased Free of Total Rate Quantity Cost Quantity Printers 10 4 14 6000 Monitor 12 4 16 11000 UPS 20 4 24 2300
Order With Tracking Number In Tally, order processing is linked to inventories. You can track the order position of a stock item, know what goods that were ordered have arrived, whether you have fulfilled the orders on time and what is the delay, if any. In this module, you learn how to record purchase orders, and to call the orders while entering a purchase invoice and likewise with sales orders and sales invoices. You will also learn how to display outstanding orders position and the effect of orders on stocks. Remember, orders do not affect financial records nor do they update inventories. Activate Sales and Purchase Order Processing in F11: Company Features. • Activate Tracking numbers in F11: Company Features, if it is not already activated. In this unit, you will use Not Applicable for Tracking Numbers. We will take up entries using Tracking numbers in the next unit. • Create a stock item Bricks with unit of measure Pcs. This is tradeable item as well as to be used for construction. Stock will be maintained. Hence, Treat all Purchases as Consumed should be set to No. • Create a Supplier - Universal Bricks with bill-wise activated and no interest calculation.
Purchase Order Processing Purchase Order details will also depend on configuration settings. Hence, have a look at the configuration and voucher types. Activate Accounting allocations in Order Entry.
Enter a Purchase Order
1. Return to Gateway of Tally. 2. Select Voucher Entry->F9: Purchase ->Select Purchase Order(Alt+4) 3. Voucher date: 15/12/08. Party's A/c Name: Universal Bricks 4. Order No: The voucher number will be your Purchase Order number. This particular Order No. field is an additional field to record order number if different from the voucher number. 5. Name of the item: Bricks. (Once the name is given the Item Allocations subscreen pops-up that needs to be filled in.) 6. Due on: 25/12/08 - 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. 7. Location: Warehouse. (in case multiple location feature is active, this field is required to be given, else it does not appear.) 8. Quantity, Rate and Amount - 5000 Pcs @ 3 per Pc. The amount is calculated but is modifiable to enable rounding off.
Item allocation sub-screen: • Next Item: Since 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]. Select Freight @3% on the item values. • Narration: Optional.
Alter a Purchase Order
You can alter a Purchase Order by displaying it from a variety of places but is easier through the Purchase Orders Book or the Day Book. Gateway of Tally ->Display -> Day Book or Gateway of Tally, Inventory Books, Purchase Order Book.
Sales Order Processing :-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. 1. Gateway of Tally->Voucher Entry ->F8:Sales ->Select Sales Order (Alt+5) 2. Voucher date: 16/12/08. Party's A/c Name: Wimbledon Properties 3. Order No: The voucher number will be your internal serial number. This particular Order No. field is for the customer's order number which is different from the voucher number. Enter WP/5. 4. Name of the item: Bricks. 5. Due on: 26/12/08.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. 6. Location: Warehouse. 7. Quantity, Rate and Amount - 4000 Pcs @ 5 per Pc.
8. Next Item: Since no other item is required, press [Enter] on the blank field to take the cursor to the tax/expense field. 9. 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]. Select or create Tax @ 17.5% to be charged on the item values.
Alter a Sales Order
You can alter a Sales Order by displaying it from a variety of places but is easier through the Sales Orders Book or the Day Book. Gateway of Tally->Display-> Day Book or Display, Inventory Books, Sales Order Book.
View Order position Stock summary is perhaps the best place to view the order position. Gateway of Tally -> Stock Summary ->Detailed [F1] Currently, all you see is the closing balances or stock in hand as on the last day of the period. However, you do not know how much stock is on order both inward and outward. if you knew that, you could take plan your stocks better and not lose out on orders. 1. Press the Orders button [alt]+[F7] 2. Select Sales Orders Outstanding 3. Type No for Due orders only. You are now in Sales Order Outstanding screen showing On Order items. Of course, you have only Bricks on order 4. Select the line Bricks and press Enter. The outstanding Sales order for Bricks is detailed. 5. Select F12:Configuration. 6. Select Yes to all options. You now see your Order Analysis with Sales and Purchase Orders outstanding position for the stock item Bricks. 1. Return to the Stock Summary screen 2. Select Detailed 3. Press [alt]+[n] Auto-Column Button. 4. Select Orders & Stock Details. 5. Remove Rate and item from display by configuring it using F12. This will enable all columns to fit in one screen. Take note of the change in figures. Can you accept an order for 2000 bricks ? 6. You may further drill down into each column to view greater detail. In the Stock Summary screen, you can even bring up a new column using [alt]+[C] the New Column button and get more options for detail. Experiment with Types of Values to get familiar with them. They are powerful and give great business information.
Adjust Orders You adjust orders at the time of raising delivery notes and invoices. 1. Select Voucher Entry 2. Select Purchase -> Purchase
3. Enter a Purchase invoice no UB/6 4. Voucher date: 25/12/08. Party's A/c Name: Universal Bricks 5. Name of the item: Bricks. (Once the name is given the Item Allocations subscreen pops-up that needs to be filled in.) 6. Tracking number : Not Applicable as goods are accompanying the bill. 7. Order No: Select the order number. 8. All fields are filled up. 9. Now enter as you would normally in a Purchase voucher. Quantity, Rate and Amount - 5000 Pcs @ 3 per Pc. 10. Expense/Tax: Freight @3% on the item values
Reorder Level
Reorder Level signifies the quantity of a Stock Item in hand, after reaching which you must place orders for your supplies. The importance of Reorder Level arises from the desire to have sufficient stocks to service customer orders and, at the same time, not to unnecessarily accumulate stock. Therefore, the points to be considered while deciding the reorder levels are as follows. o The lead-time for suppliers to deliver the stock. o The delivery time specified by the customer. o The stock-in-hand to satisfy orders in the meantime. In simple mode, Tally accepts the quantities that you specify. In advanced mode, it considers the past consumption patterns to suggest reorder levels. You can however, choose to define your own reorder levels. You may also specify the minimum quantity of the item to be ordered, either in simple or advanced mode. The purpose of specifying reorder levels is to obtain a report that indicates the quantity of a Stock Item that you must order. Specifying Reorder Levels Go to Gateway of Tally > Inventory Info > Reorder Levels Select a group of Stock Items from the List of Groups, to specify Reorder Levels for the Stock Items in the Specify Reorder Levels screen. For each item in stock, you can define a Reorder Level and the Minimum Order Quantity. If you click Simple Reorder button, the consumption alternatives will not be available and hence you have to input the quantities. Note: The option Reorder Levels is displayed in the Inventory Info. menu only if Allow Purchase Order Processing is enabled in F11: Features. The Reorder level screen appears as follows: The options that you have while defining Reorder Level and Minimum Order Quantity for individual stock items are as follows. Reorder Level/Quantity Enter the level/quantity in this field. Advance Parameter for Reorder Level (Consumption for the Last) This field lets Tally calculate the reorder level/order quantity based on the total consumption in the past for a chosen period. Period
The choices for periods are: Days, Weeks, Months and Years. Note that it is not the average consumption for the period but the total consumption. Enter zero (0), if you do not want Tally to calculate the reorder level based on the consumption of the item in the past. Criteria Choose whether you want the higher/lower of the two, i.e., input/calculated level/quantity. Rounding Method Specify whether the calculated level/quantity must be rounded and also the method of rounding. Minimum order quantity You can specify the minimum order quantity required.
Tracking Number You were buying and selling goods or services where the stock would be affected when making the purchase or sales entry. Many businesses deliver stock with a delivery note or a challan. The bill is raised later. The bill has to be linked or tracked with the goods already delivered. In Tally, tracking numbers do the job. Tracking numbers allow Goods Receipt and Goods Delivery Notes for goods not accompanied by an invoice to be linked with the invoice that is raised later. Of course, Tally permits the opposite too. A bill can be raised first and the goods delivered. Again, tracking numbers do the trick. Tally walk-through for using tracking numbers 1. Go to voucher entry. 2. Select Purchase, Receipt Note. 3. Enter the following transaction: 4. On 12/12/98 - Ref GRN/UB - 1000 Pcs of Bricks received from Universal Bricks @2 per Pc. 5. For Bricks, select Tracking Number GRN/UB and give item details. 6. Press Enter on the blank Tracking number to return to the main voucher. 7. Accept the voucher and Return to Gateway of Tally 8. Select 'Display', 'Statements of Inventory', and then 'Purchase Bills Pending'. Purchase Bills Pending screen: 1. Tally tracks down the Goods received but whose bills have not been received. 2. View the Profit & Loss Account and the Purchase Accounts. 3. Tally provides the purchase so that the profits are correctly arrived at. 4. View the Balance Sheet, Sundry Creditors. Has Tally provided for the liability? 5. Tracking numbers - track bills with goods delivered Now go back to Voucher Entry 1. On 15/12/08, you receive the purchase bill no UB/15 from Universal Bricks for their Delivery Note no GRN/UB for 1000 Pcs of Bricks @ 2 per Pc. You get
30 days credit. 2. Select Purchase, Purchase Ref: UB/15 Cr Universal Bricks 2000 Billwise UB/15 30 days 2000 Dr Project Purchase 2000 3. Inventory Allocation • Tracking Number: Select GRN/UB. Note UB/15 is also listed there. Do not select this. • Accept the other information that is filled up. Press Enter on the blank Tracking number to return to the main voucher. 4. Cost Centre is activated for Project Purchase. Select Projects and Assignments Category and Buildings Cost centre. 5. Accept the voucher. 6. Now go back to Purchase Bills Pending. Is there anything pending? Exercise No: 22
a) 1.4.2008 Received Capital By Cash Rs.5,00,000 1.4.2008 Cash Deposited in SBI Rs.2,00,000 5.4.2008 Purchase Order Made to Rahul Textiles [P.O.N0.101] 5.4.2009 Due 12.4 Cotton Sarees 50 nos at Rs.300 Chudithar 50 nos at Rs.400 7.4.2008 Purchase Order Made to Kiran Textiles [P.O.N0.102] Due 15.4 Cotton Sarees 75 nos at Rs.300 Chudithar 60 nos at Rs.400 10.4.2008 Purchase Order Made to Sona Textiles [P.O.N0.103] Due 25.4 T-Shirts 100 nos at Rs.100 Jeans 100 nos at Rs.1000 10.4.2008 Purchase invoice raised for the Order 102 [Bill No.1234] 12.4.2008 Received Materials For the Purchase Order From Sona Textiles [P.O.N0.103] [RN.NO 567] 15-4-2008 Returned T-Shirts 10 nos, Jeans 5 nos [RN.NO.567] 20-4-2008 Purchase invoice raised for Sona Textiles [Bill No.5678] 18-4-2008 Sales Order Received From Arjun Stores [SO.NO.111] Due Date 25/4 Cotton Sarees 60 nos 500 Chudithar 40 nos 750 22.4.2008 Sales Order Received From Brinkley Garments [SO.NO.118] Due Date 30/4 T-Shirts 60 nos 150 Jeans 60 nos 1300 27.4.2008 Sales Invoice Raised For Sales Order NO 111 [Arjun Stores] + TNGST 4% 29.4.2008 Delivery Note Given For Brinkley Garments For Sales Order No.118 [DN.NO.556] 1-5-2008 Returns From Brinkley Garments T-Shirts 10 nos
Jeans 5 nos 5.5.2008 Sales Invoice Raised For The Delivery Note 556
b) Kiran Electricals Started Business of Electrical items 1.8.2002 Received Cash For Capital Rs.8,00,000/1.8.2002 Deposited in UCO Bank Rs.3,00,000/7.8.2002 Purchase Order Made to Nithya Fan House [NO.124] [Due Date 14/8] Ceiling Fan 500 nos @ Rs.1500 Table Fan 500 nos @ Rs.1200 10.8.2002 Purchase Order Made to Athi Electricals [NO.111] [Due Date 18/8] Ceiling Fan 150 nos @ Rs.1500 Table Fan 150 nos @ Rs.1200 14.8.2002 Purchase Invoice Raised For Order NO.124 19.8.2002 Received Materials For the Purchase Order NO.111 through Receipt Note NO.12 20.8.2002 Returned 10 nos of the Ceiling Fan & 5 nos of Table Fan For the Order NO.124 22.8.2002 Sales Order Received From Akshai Traders [NO.2,Due Date 1/9] Ceiling Fan 300 nos @ Rs.2000 Table Fan 300 nos @ Rs.1500 1-9-2002 Raised Sales Invoice For the Order NO.2 with Sales Tax @ 4% 2.9.2002 Sales Order Received From ABI Traders [3.Due Date 10/9] Ceiling Fan 200 nos Table Fan 200 nos 10-9-2002 Delivery Note Raised For the Order NO.3 12.9.2002 Returned 5 nos of Ceiling Fan.Table Fan 14-9-2002 Sales Invoice raised For the Order NO.3
Track Additional Cost Of Purchase Normally, in case of purchase, taxes etc, are also considered to be part of purchase and we may wish to debit purchase account only for the entire cost. With this feature, without debiting separate account, we may get breakup of basic price as well as additional cost incurred, resulting into the Effective Rate on various inventory reports. For Example, Athi & Co purchased the following components CPU 50nos 15000 Keyboard 50nos 7000 At the time of purchase of components, they spent additional cost such as Carriage 15000 Packing charges 2000 F 11 Features – Activate the options Track Additional Cost of Purchase - Yes • Create ledger Under Sundry Creditor Athi & Co • Create an Unit of Measure Nos as Shown below:
• Create a stock item as CPU • Pass purchase Entry After entering the purchase go to Display →Inventory Books → Movement Analysis → Stock Item Analysis → Select the Item Exercise: 23 a) On 1/1/2005 Received capital by cash Rs. 5, 00,000 On 2/1/2005 Deposited in ICICI Bank Rs. 2, 00,000 On 5/1/2005 Purchased from GTL 500 Nos. of Lux Soaps @ 15/No Sales Tax 4% Packing Rs. 500 Carriage Rs. 700 [Create bill no. Credit days 30] On 8/1/2005 Purchased from GTL 500 Nos. of Power Soaps @ 10/No Sales Tax 4% Packing Rs. 700 Carriage Rs. 1000 [Create bill no. Credit days 30] On 20/1/2005 Purchased from GTL 200 Nos. of Arial Powder @ 50/No Sales Tax 4% Packing Rs. 750 Carriage Rs. 1200 [Create bill no. Credit days 30] On 31/1/2005 Paid to GTL for all the products. Discount received 5 % b) Rahuvar & Sons purchased the following components CPU 100 Nos 15000 Keyboard 100 Nos 7000 Mouse 100 Nos 1500 IC Chips 150 Nos 1000 At the time of Purchase of components they spent additional cost such as Carriage 15,000 Tax 4% Packing Charges 20,000 Labour Charges 5,000
Bill of Materials A Bill of Materials contains a list of items that make up another item. In other words, it is a list of constituent items for a product. Enable Bill of Materials Facility To activate or enable Bill of Materials go to Gateway of Tally, Click on F12: Configure and select Accounts/inventory Info from the menu. Now say yes to "Allow component list details (Bill of Materials)?" A Bill of Material should be available while manufacturing an item. Hence, first enable manufacturing entries. This is done through a stock journal. Create a new manufacturing journal Create a new voucher type called Manufacturing Journal under Stock Journal.
1. To create a new Manufacturing Journal go to Gateway of Tally. Select Accts Info, Voucher Type and then Create. 2. Give Mfg.Journal (Manufacturing Journal) as the name and under ' Voucher types' select Stock Journal. 3. Follow the normal Voucher type creation as explained earlier for the rest. 4. Select Yes for "Use as Manufacturing Journal" and accept the screen. Create a Bill of Material You can create a Bill of Material (BoM) for any stock item. Typically, you would like to create a BoM only for those items that are being manufactured. You will specify a BoM at the time of creating a stock item or altering its master. Tally walk-through to specify its Bill of Materials JC Computer Supplies decides to get into the business of Televisions. They want to assemble their own televisions and sell them. Therefore, 1. Create a stock item Television. Create it under a new stock group Home Electronics. 2. Unit of measure - nos. 3. Say Yes to "Set Components (BoM)?" 4. Once this is made to yes it takes you to a screen where you can enter 1 each for Unit of Manufacture and items VDU, Picture tube, IC Chips, Sound Card and aerial which are required for the assembly of one Television. These items do not exist. Create them and group them under a stock group Television Parts. Unit of measure - nos. 5. Give Standard Cost for each of the items as follows:6. VDU - 2000, Picture Tube - 3750, Sound Card - 500, IC Chips - 5000, Aerial 300. 7. You propose to store them On-Site. Accept the screen. Accept all other defaults. None of the items will have any opening stock balance. The purpose of creating a bill of material is to enable consumption of the materials in the ratio specified when the product is manufactured. Tally uses a Manufacturing Journal to enter goods manufactured with bill of materials. First you should purchase the components required to produce the television. Make a purchase voucher entry as follows: On 21 December 08, bought 10 pcs each of the following at the standard cost mentioned against them: 1. VDU - 2000, Picture Tube - 3750, Sound Card - 500, IC Chips - 5000, Aerial 300. Paid cheque from Current Account immediately. Stored On-Site. Account Purchases. Ignore Tax. Manufacturing Journal Entry From the Gateway of Tally Menu select Voucher Entry, As you have created new voucher type Mfg. Journal, a pop-up menu will show both
the default Stock journal and the manufacturing journal. 1. Select manufacturing journal. 2. Under the Name of Product to be manufactured, type Television. 3. Manufacture it in the On-Site. 4. Quantity to be manufactured - 5. 5. Under Component (consumption) the component list for the television to be manufactured under proportionate quantity of each component is picked up automatically. The default location as specified in the BoM is also given for each component. The standard cost is picked up for each item. However the entire component list can be altered. 6. It will take you to the screen giving the details of additional cost. Under Additional Cost Components you may specify the additional cost incurred for producing the item. Additional cost of Wages - 3000 and Power - 2000 have been incurred. Add them in. If ledger accounts for these expenses do not exist, create them under Direct Expenses. 7. Note that the additional costs entered for the Iedgers, do not reflect in the relevant ledger with the amount but only add to, the cost of the item. Exercise : 24 a) Stock Item VCD Player Components Aerial Rs.2, 250 IC Chips Rs.1, 200 Speaker (2 nos) Rs.1, 500 On 19-08-2007 Manufactured 250 Nos of VCD Player Additional cost Power Rs. 20,000 Wages Rs. 15,000 b) Moorthy &Co purchased the following components for used Switch Boards: 1. 12ﾗ8 Wooden Board 1 No. 18.00/no 2. Switches 4 Nos. 15.00/no 3. 2pin plug point 1 No 20.00/no 4. 3 pin plug point 2 Nos 25.00/no On 10/5/2004 They manufactured 100 units of switch Boards Additional costs incurred are as follows: Wages 15000 Power 10000 At the time of Purchase of components, they spent additional cost such as Carriage 5000 Tax 4% c) Manu &Co purchased the following components for used Computer: 1. Mother Board 1 No. 6,900 2. SMPS 1 No. 4,780
3. Hard Disk 1 No 4,900 4. RAM 1 No. 2,500 5. Floppy Drive 1 No. 550 6. CD Drive 1 No. 1,280 On 10/5/2004 They manufactured 10 Numbers of Computer Additional costs incurred are as follows: Wages 3, 000 Power 2, 000
Price List This feature is provided in Tally to allow different pricing structure for the same item depending on their quantity of purchase or sale. Activate and create Price List Types 1. Press F11: Features. At the bottom the last option is Set/Modify Other Company Features. Type Yes. 2. Activate "Use Multiple price levels for invoicing". Tally takes you to "Company Price Levels" screen. 3. Type the different price levels - Retail Sales, Export Sales and Whole Sale and accept the screen. 4. Accept all the features and return to Gateway of Tally. Create a Price List 1. The following are the steps to create a price list. Simply go through them but create the price list in the exercise. 2. From the Gateway of Tally select Inventory Info and Click on Price List. 3. Select the required stock item group from the List of Groups or you can even select All Items if you require to set the price list for all the Stock Items you have created. 4. Now the Price List screen is displayed. 5. Select the price level from the pop - up for e.g. Retail Sales and enter the date from which your price list is applicable. 6. Enter the Quantity, Rate and the Discount % for the respective items. You will find the Standard Cost Price of the items displayed on the extreme right of the screen 7. More than one Price level can be entered for a single Stock Item. Note: These prices will automatically appear while making an Invoice once the price level is specified. When we change the price list with a new 'applicable from' date, the previous prices given for the item will be shown in the Historical Details column. Now the customer ledger accounts have to be altered to put them in the relevant price level.
a) Retail Sales Bronze 8 Less than 10 Nos. Rs.65 10 Nos. to 25 Nos. Rs.65 5% From 25 onwards Rs.65 10% Gold 8
Less than 10 Nos. Rs.80 10 Nos. to 25 Rs.80 5% From 25 onwards Rs.80 7.5% Silver 8 Less then 10 Nos. Rs.100 10 Nos. to Nos. Rs.100 5% From 25 onwards Rs.100 8% Whole Sales Price Bronze 8 Less than 10 Nos. Rs.55 10 Nos. to Nos. Rs.55 5% From 25 onwards Rs.55 10% Gold 8 Less than 10 Nos. Rs.75 10 Nos. to 25 Nos. Rs.75 5% From 25 onwards Rs.75 10% Silver 8 Less than 10 Nos. Rs.95 10 Nos. to 25 Nos. Rs.95 5% From 25 onwards Rs.95 8% On 02-06-2007 Purchased 50 Nos of Gold 8, 25 Nos of Silver 8, 22 Nos of Bronze 8. On 04-06-2007 Sold to Tirumathi & Co 25 Nos of Gold 8, 15 Nos of Silver 8, 10 Nos of Bronze 8. (Retail Sales) On 16-06-2007 Purchased 25 Nos of Gold 8, 25 Nos of Silver 8, 25 Nos of Bronze 8 On 25-06-2007 Sold to Jeba & Co 5 Nos of Gold 8, 5 Nos of Silver 8, 10 Nos of Bronze 8 (Whole Sales) b) Export price Cotton sari Less than 50 Nos. Rs.700 50 to100 Nos . Rs.700 3% More then 100 Rs.700 5% Chudidhar Less than 20 Nos. Rs.1000 20 to50.Nos. Rs. 1000 2% More then 50 Rs .1000 5% Retail Price Cotton Saris Less than 60 Nos. Rs.800 60 to100 Nos. . Rs.800 4% More then 100 Rs.800 6% Chudidhar Less than 20 Nos. Rs. 900 20 to 50.Nos. Rs. 900 2% More then 50 Rs. 900 5% Whole Sale
Cotton Sarees Less than 50 Nos. Rs.700 3% 50 to100 Nos. . Rs.850 4% More then 100 Rs.800 6% Chudidhar Less than 20 Nos. Rs. 950 20 to 50 Nos. Rs. 950 2% More then 50 Rs. 950 5% On 02/4/2004 Cash Purchase: Cottan Sarees Rs. 500 1000 Nos Chudidhar Rs. 300 800 Nos On 16/4/2004 Sold to Ram traders Cotton Sarees 150 Nos., Chudidhar 100 Nos [Whole sales] On 20/4/2004 Sold to Naveen Exporters Cotton Sarees 150 Nos, Chudi 80 Nos [Export price] On 30/4/2004 Sold to Amirtha Textiles Cotton Sari 90Nos. Chudi 40 Nos [Retail Price]
