Professional Documents
Culture Documents
Volume-2
Notices
Information in this training manual is subject to change without prior notice and does not represent a
commitment on the part of Tally Solutions Pvt. Ltd.
Trademarks
Tally is a registered trademark of Tally Solutions Pvt. Ltd.
Ver : Tally Financial Accounting Program Vol-2/Release 1.0/India/October 2005.
The age-old glass cupboards shelved with huge books of accounting has become a rare sight these
days. With computers taking over every aspect of human life, accounting also has acquired a new
face. Tally: the name synonymous to simple accounting process and business management.
Consider the job market; Tally Certified Professionals are the most-wanted and preferred employees.
Tally features a spiral learning method where the student is introduced to different aspects of
Accounting on computers. Additions are made to the lessons as and when the student becomes
confident about the previous lessons in accounting imparted by Tally. This method ensures that the
student learns Tally thoroughly. This type of teaching promises an organised and consistent learning
process.
In Volume 2, the student will learn to work with selected inventory related features of Tally. The
student will learn to design, setup and manage accounting systems with the help of Tally. They learn
to process transactions involving purchases and sales of goods, sales, Bills Receivable, and Bills
Payable, Set up related accounts and other documents, and prepare the financial statements.
Trust Tally for a brighter future! Happy learning with Tally!
Appendix
a.1 List of Transactions ................................................................................................... 165
a.1.1 Sample Exercise ...................................................................................................... 165
a.1.2 Provision Entries .................................................................................................... 179
a.1.3 Depreciation Entries ............................................................................................... 179
a.1.4 Adjustment Entries for Prepaid Expenses .............................................................. 179
a.1.5 Other Adjustment Entries ....................................................................................... 179
a.1.6 Practice Exercise .................................................................................................... 180
a.2 Chart of Accounts ...................................................................................................... 208
a.2.1 Sample Exercise ...................................................................................................... 208
a.2.2 Practice Exercise .................................................................................................... 210
a.2.3 List of Function Keys .............................................................................................. 212
Lesson Objectives
Upon completion of this lesson you will be able to:
Understand the nature of a trading organisation and its activities.
Define inventory and explain accounting terms related to inventory.
You learned to process simple transactions, set up related accounts and prepare financial state-
ments. Systematic instructions were provided on the treatment of receipts and payments; advance
and credit payments for services provided; purchase of office equipments and other supplies;
adjusting entries for depreciation, prepayment, accrued revenue and expenses. The hands-on
practical approach gave you an understanding of Tally and the fundamentals of accounting.
Volume 2 deals with trading organisations and the significant role inventory plays in these organisa-
tions. You will understand the cycle of purchases, sales and and how traders use price levels to
segment customers.
Gross Profit
Gross profit is the profit earned out of core activity of buying and selling. Gross profit is arrived at by
reducing the direct expenses from direct incomes.
Gross profit in terms of percentage = [(Gross Operating Revenue – Cost of goods sold) * 100]/
Gross Operating Revenue)
Operating Expenses
Operating expenses are periodic expenses incurred in the course of running the business. It covers
all expenses related to the ongoing operations of a company, including sales,marketing, and admin-
istrative expenses.
Net Profit
Net profit is also known as profit or net earnings.
Net profit = Operating profit – Interest expense – Income Tax expenses
In a price sensitive market, where one has to quote the selling price of the material based on the cost
of purchase, the questions to be answered are:
Is input stock identifiable with output stock?
Is the cost of input stock identifiable with output stock used for sales?
LIFO involuntary liquidation may result in income that is detrimental from a tax view.
LIFO may cause poor buying habits (because of the layer liquidation problem).
Standard Cost
Under this method, a standard price is set for each material and issues for a specified period are
made at this price. At the end of the period, the variances between actual and standard price are
booked to reflect the real position.
In the other valuation methods, comparison of two jobs is not possible due to market fluctuations.
Standard pricing method overcomes this deficiency.
Note: In Tally, perpetual inventory system is applicable when ‘Integrate accounts with Inventory’ in
F11: Features is set to ‘Yes’.
A periodic inventory system is adopted in organisations where the cost of recording stock movement
outweighs the benefits of recording and updating stock status. Organisations may not consider the
need for systematic recording :
When there is a strong physical control over the movement of goods.
When physical verification of stock is simple, on account of the low quantity of stock .
When price movement of material is insignificant.
When movement at stores level cannot be recorded or there are no stores.
Note: In Tally, periodic inventory system is applicable when ‘Integrate accounts with Inventory’ in
F11: Features is set to ‘No’.
Cost of goods sold represents direct costs incurred by businesses in the process of selling
goods.
Gross profit is the profit earned out of core activity of buying and selling.
Operating expenses are periodic expenses incurred in the course of running the business.
Operating profit is the net income before income tax and interest expenses.
Inventory consists of raw materials and other items available for sale or in the process of
being made ready for sale (work-in-process).
Lesson Objectives
Upon completion of this lesson you will be able to:
Define cash and credit purchases and differentiate between the two.
Define cash and credit sales and differentiate between them.
Understand the concept of price levels.
Understand the principles of revenue recognition.
Understand the application of bills of exchange.
Understand the accounting and commercial terms associated with purchases and sales.
Understand the concept of Value Added Tax and Sales Tax.
When both parties involved in the transaction agree upon a later date as the date of payment for the
goods purchased it is known as credit purchase. If the goods are purchased in smaller units, vendor
details are not recorded in the books. However, if the buyer orders on a regular basis, the transac-
tions are usually routed through a vendor account. This helps buyers to:
Record payments to be affected in future.
Negotiate trade and cash discounts.
Bargain for greater credit period.
Example for credit purchase: National Stores bought glass cups worth Rs. 1000 from K R
Glassware Company and paid after 90 days of purchase. The entry passed at the time of purchase
is:
Purchases Account Dr. 1000
K.R.Glassware Company Account Cr. 1000
At the time of making payment, the entry passed is:
K.R.Glassware Company Account Dr. 1000
Cash/Bank Account Cr. 1000
Note that K.R.Glassware Company Account is netted off and the second entry matches with the
earlier cash purchases entry.
This has resulted in Three Way Matching principle wherein payment is released when:
A proper purchase order has been placed to the supplier, encompassing rate, quantity,
delivery and payment terms.
Goods are actually received in “stores” and verified with respect to quantity and quality.
Invoices received from the supplier match with purchase order terms as well as goods
receipt note issued by the company’s stores.
When both parties involved in the transaction agree upon a later date as the date of payment for the
goods sold it is known as credit sales.
Example for credit sales: K.R.Glassware Company sold glass cups worth Rs. 1200 to Variety
Stores on credit of 60 days. The entry passed at the time of sale is:
Variety Stores Account Dr. 1200
Sales Account Cr. 1200
If the goods sold are in smaller units, then the seller need not record buyer details. However, if the
supplier receives regular orders, the transactions are regularly routed through the customer account.
The price level feature in Tally allows setting up of different price lists for the same items. One can
prepare invoices with ease for different customers for the same product having different price list
based on the customer or market segmentation.
Seller retains no effective control over the goods usually associated with ownership.
No significant uncertainty exists regarding the amount of consideration to be received.
Some of the factors that help in deciding the credit period are:
The credibility of the buyer based on his own financial stability and relationship with the
seller.
Overall profitability on account of repeated orders.
The profit margin in the product.
The credit period offered by the competitors.
Returns/ Allowances
Returns are the total value of merchandise returned by customers for refund or credit. Allowance,
on the other hand, is a concession granted to customers for unsatisfactory goods or services.
Goods may be returned on account of the following:
Quantity related issues.
Quality related issues.
Payment terms and delivery related issues.
It is important to understand, at the time of returns, whether purchases/sales have been booked in
the account books.
If purchases/sales are already recorded, a debit note/credit note has to be raised to account
for returns/allowances.
If purchases/sales are not recorded, a delivery note/receipt note is issued and rejection
out/rejection in is recorded to account for returns/ allowances.
Debit note is a note that accounts for an amount owed by a person or company. A debit note is
prepared showing the date of return, name of the supplier to whom the goods have been returned,
details of the goods returned and reasons for returning the goods. It informs the supplier that his
account has been debited with the value of the goods returned. If discount was allowed by the
supplier, this should be taken into consideration while calculating the value of the goods returned.
The scope of a debit note in not limited to account for purchase returns only but can also be issued
when:
The buyer does not agree with the sales invoice of the supplier after booking the purchases.
The supplier intimates the buyer that interest is due for delayed payments.
The supplier accounts for and intimates the buyer that expenditure incurred on his behalf
are recoverable.
Credit note is a note that acknowledges and accounts for an amount owned by a person or a
company. It is a simple and efficient system to inform the supplier of all the receipts due.
Transactions involving bills of exchange are governed by the provisions of the Negotiable Instru-
ments Act, 1881.
The drawer can make use of the bill in any of the following ways:
Retain the bill till the date of maturity and collect the money from the drawee.
Endorse the bill to his creditor.
Discount the bill with the banker.
Send the bill to the banker for collection.
For example: K.R.Glassware Company sold to Variety Stores glass cups worth Rs. 2000 and drew
upon them a bill of two months, for the amount, on 1-6-2005. Variety Stores accepted the bill and
returned it to K.R.Glassware Company, which retained the bill, and on its maturity, presented it to the
drawee. The bill was honoured.
ACCOUNTING ENTRIES IN THE BOOKS ACCOUNTING ENTRIES IN THE BOOKS
OF DRAWER OF DRAWEE
When goods are sold on credit When the goods are purchased on credit
Variety Stores Account Dr. 2000 Purchases Account Dr. 2000
To Sales Account Cr. 2000 To K.R.Glassware Company Cr. 2000
Account
When the bill is drawn and accepted When the bill is accepted
Bills Receivable Account Dr. 2000 K.R.Glassware Company Dr. 2000
To Variety Stores Account Cr. 2000 Account
To Bills Payable Account Cr. 2000
In addition to sales tax, some states also levy additional tax, surcharge, turnover tax and the like.
Sales tax is payable by the seller to the Government. Ordinarily, sales tax is recovered from the
buyer as a part of consideration for sale of goods. Rates of sales tax vary from state to state.
Lesson Objectives
Upon completion of this lesson, you will be able to:
Understand the basic and advanced features of Tally.
Understand the features in Tally pertaining to duties and taxes.
Recognise Tally’s capability for a trading organisation.
Lesson Objectives
Upon completion of this lesson, you will be able to:
Understand the relevant features and configuration settings.
Record transactions through accounting vouchers.
Appreciate the need for bank reconciliation and how it is done.
Understand cheque printing and its requirements.
MAINTAIN
OPTION DESCRIPTION
Accounts only Financial Accounts of the company only
Accounts with Inventory Both Financial Accounts and Inventory Records of the
company
Integrate Accounts and Inventory?: If accounts are not integrated with inventory, inventory
vouchers will not have any impact on the balance sheet stock figures. Stock balances will be main-
tained separately. However, if the accounts and inventory are integrated by setting this field to ‘Yes’
inventory entries automatically update the balance sheet stock figures. In other words, the perpetual
inventory system is activated.
Allow Invoicing?: Invoicing is generally used for sale of stock where the details of the items sold are
listed. Without invoicing, the option for price lists will not be available.
Enter Purchases in Invoice Format?: If this field is set to ‘Yes’, purchase vouchers can be created
in invoice mode. The suppliers' invoices can be entered in the same way as they physically appear.
In invoice mode, purchases can be allocated to cost centres only when cost centre classes are used.
Using the voucher mode of entry for purchases allows manual allocation of purchases to cost
centres.
Maintain Billwise Details?: This field has to be set to ‘Yes’ for it to be available for ledger accounts.
Each ledger account can then individually be set for the feature as required.
The other features will be explained as and when required in the later sessions.
Note: Base currency information can be altered only if ‘Allow Multi-currency’ is activated in F11:
Features is set to ‘Yes’.
Configuration settings affect all companies maintained in the same data directory and setting config-
uration for one company will affect other companies in that data directory.
Allow ALIASES along with names?: An alias is another name for an account head. For those who
wish to continue with account codes, this field can be used to enter codes. If an 'alias' is given, both
'Name' and 'alias' are available while entering a voucher, either of them can be used. Enter a blank
field if specifying alias is not necessary.
Allow Advanced entries in Masters?: If this field is set to ‘Yes’, fields requiring advanced settings
are displayed in the group creation and ledger creation screen.
Net Debit/Credit Balances for Reporting?: If this field is set to ‘Yes’, amounts are dis-
played as a net figure instead of separate debit and credit balances in reports.
Add NOTES for Ledger Accounts?, Use ADDRESSES for Ledger Accounts?, Use CONTACT
DETAILS for Ledger Accounts?: These three fields are self explanatory. If these are set to ‘Yes’,
user can fill in the mailing and related details along with essential notes for a ledger account head.
The other features will be explained as and when required in the later sessions.
Configuration settings of one company will affect all companies maintained in the same data direc-
tory.
Skip Date field in Create Mode (faster entry!)?: If this is set to ‘Yes’, Tally goes directly to the Dr or
Cr field, depending on the voucher type. If this is set to NO, Tally goes to the date field. If there are
many entries to be made on the same date, it is advantageous to set this option to ‘Yes’, for faster
entry.
Show Inventory Details?: If this field is set to ‘Yes’, Tally shows the name of the stock item,
quantity, rate and value details.
Show Table of Bill Details for Selection?: If this field is set to ‘Yes’, Tally displays a table listing
the pending bills references.
Show Bill-wise Details?: If this field is set to Yes, bill-wise details are available. Bill-wise details are
pertinent only for party accounts, that is, ledger accounts classified under Sundry Debtors, Sundry
Creditors and Branch/Divisions. Bill-wise details sub-screen does not come up for inventory
vouchers. It is relevant only for accounting purposes.
Bill-wise details need to be set to ‘Yes’ if the user has to track each invoice to its conclusion and to
adjust the bills and payments, bill by bill. Information about outstanding analysis, ageing analysis,
pending, due and overdue bills, and so on can be obtained from this feature.
Expand into multiple lines?: This is the additional field displayed when ‘Show Bill-wise Details’ is
activated. If this field is set to Yes, Tally displays all bill-wise information, for example, the 'due date'
based on the credit days given.
Show Ledger Current Balances?: If this field is set to ‘Yes’, Tally displays the current balance of
the ledger selected while the user makes an entry. This avoids the need to go to the report to get the
balance information.
Show Balances as on Voucher Date?: This is the additional option displayed when ‘Show Ledger
Current Balances’ is set to ‘Yes’. If this is set to yes then any voucher viewed in alteration mode will
display the ledger balances on the voucher screen based on the voucher date and not the current
balance based on date of last entry.
Allow Cash Accounts in Journals?: If this field is set to ‘Yes’, Tally allows entry of transactions
which affect cash and bank account in journal vouchers.
Use Cr/Dr instead of To/By during entry?: If this field is set to ‘Yes’, Tally uses Dr/Cr instead of the
defaults To/By. Each voucher line displays a prompt of 'Dr' or 'By' for debit entries, or 'Cr' or 'To' for
credits. Depending on the voucher type, Tally selects either 'Dr' or 'Cr' for the first prompt, which the
user cannot change. Thereafter, the prompt can be changed (if necessary) by typing over it with a D
or C.
Warn on Negative Cash Balance?: If this field is set to ‘Yes’, Tally warns the user in case the cash
ledger reaches a negative balance. Tally warns and displays the credit cash balance in Red. The
user can accordingly decide whether to proceed with the entry.
The other features will be explained as and when required in the later sessions.
Anurag Rai started a new shop ‘Smart Agencies’ on Wood Street, Bangalore, on 1-4-2005. Smart
Agencies will deal in the wholesale trade of stabilisers and pumps of different capacities.
The transaction details recorded for Smart Agencies is elaborated in the illustration.
Note: Please refer appendix I for the list of transactions for Smart Agencies. Refer appendix II for the
entire list of chart of accounts for the same.
Tally acknowledges the special requirements of some users for more voucher types. These arise
in cases like when user needs the same voucher but in different names or separate series of
numbers. Examples include Cash Payment Vouchers and Bank Payment vouchers where the
relevant predefined voucher is Payment Voucher.
i.Create ledgers Anurag Rai Capital A/c (under Capital Account) and ICICI Bank (under Bank
Accounts)
Note: Mr. Rai wants to segregate the local and outstation creditors’ accounts. Hence, he asks
his accountant to create sub-groups under the primary group sundry creditors as depicted in the
chart.
Figure 4.9 Chart representing the primary group (Sundry Creditors) and its subgroups
As per Tally conventions
i. Create group Local Creditors (under Sundry Creditors)
1. Go to Gateway of Tally > Accounts Info. > Groups > Create to view the group creation
screen.
2. Name: Local Creditors.
3. Under: Sundry Creditors.
4. Group behaves like sub-Ledger: Yes.
5. Accept? Yes or No Press Y or Press Enter.
Note: Rest of the fields are retained at their default values. Press Enter to skip fields without
making changes.
Note: Since Input VAT @ 12.5% is selected as the VAT/Tax class the percentage of calculation
automatically appears as 12.50. The method of calculation automatically is set to ‘On VAT Rate’
when VAT is selected as the type of duty/tax.
Stock Item
Stock items are the primary inventory entity. Stock items are used while recording receipts and
issues of inventory. This is the lowest level of information of inventory. Each item that is required
to be accounted for needs to be created. A stock ledger account is created for each item and
Tally calls this account 'Stock Item'.
Stock Group
Stock items can be grouped together under stock groups to reflect their classification based on
some commonality. Grouping enables easy location and reporting of stock items in statements.
Hence, items of a particular brand or type can be grouped together so that one can extract stock
of all items of that brand or type. For further analysis, sub-groups of stock groups can be cre-
ated.
Units of Measure
Unit of measure is the basic unit of measurement used to measure stock items. For every stock
item, a unit of measure needs to be created. These can be simple units (for example numbers,
meters, kilograms, pieces) or compound units (for example box, where one box equals ten
pieces). A compound unit is a relation between two simple units. Hence, before a compound unit
is created, ensure that the two simple units are created.
Note: In this level, only simple units are created and used. Creation and use of compound units
will be dealt with in the next level.
v. Create stock group Stabilisers (under Primary)
1. Go to Gateway of Tally > Inventory Info. > Stock Groups > Create to view the stock group
creation screen.
2. Name: Stabilisers.
3. (alias): Skip field.
4. Under: Primary.
5. Can Quantities of items be ADDED? : No.
ii. Create stock items Low Capacity Stabilisers (under Stabilisers), Open Well Pumps and
Submersible Pumps (both under Pumps)
12. Retain the amount displayed and accept the accounting details screen.
13. Name of Item: Open Well Pumps.
14. Quantity: 50 nos.
15. Rate: 1500.
16. Amount: Amount of 75000 is automatically displayed.
17. Press Enter to view the accounting details screen.
18. In the accounting details screen, select Purchases @ 4% from the list of ledger accounts.
19. Retain the amount displayed and accept the accounting details screen.
20. Name of Item: Submersible Pumps.
21. Quantity: 100 nos.
22. Rate: 2000.
23. Amount: Amount of 200000 is automatically displayed.
24. Press Enter to view the accounting details screen.
25. In the accounting details screen, select Purchases @ 4% from the list of ledger accounts.
26. Retain the other fields as they are and accept the accounting details screen.
27. Press Enter and select Input VAT @ 12.5% from the list of ledger accounts displayed.
28. Rest of the details are calculated and displayed automatically.
29. Press Enter and select Input VAT @ 4% from the list of ledger accounts displayed.
30. Rest of the details are calculated and displayed automatically.
31. Press Enter thrice to view the bill-wise details screen.
32. In the bill-wise details screen, select ‘New Ref’ in the ‘Type of Ref’ field.
33. Name: Type P-A2Z-02.
34. Retain the other fields as they are and accept the bill-wise details screen.
Figure 4.21 Detailed Trial Balance – 1st April 2005 to 30th April 2005
i. Create ledgers Sales @ 12.5%, Sales @ 4% (both under Sales Accounts) and Output VAT
@ 12.5%, Output VAT @ 4% (both under Duties and Taxes)
Note: During the creation of the sales accounts and duties and taxes ledgers, ensure that the
following details are as mentioned.
SALES ACCOUNTS LEDGERS DUTIES AND TAXES LEDGERS
FIELD STATUS FIELD STATUS
Cost centres are No Type of Duty/Tax VAT
applicable
Used in VAT Returns Yes Cost centres are No
applicable
VAT/Tax Class Sales @ 12.5% (4%) VAT/Tax Class Output VAT @
12.5% (4%)
Inventory values are Yes Inventory values are No
affected affected
Figure 4.26 Detailed Trial Balance – 1st April 2005 to 31st May 2005
To print a cheque:
Go to Gateway of Tally > Display > Day Book
Click on F2: Period to change period. From: 1-5-2005 To: 31-5-2005.
Select a payment voucher. For example, select bank payment voucher dated 15-5-2005.
On enabling cheque printing option, two new fields are included in payment vouchers.
Name on cheque: Type ‘A2Z Traders’.
Cross Cheque using: By default, it shows ‘Account payee’. However, this can be
changed.
Accept the payment voucher screen to view the cheque printing dialog box.
Make sure that ‘With preview’ is enabled and Accept the cheque printing dialog box.
Click Zoom or press ALT + Z to view an enlarged version of the cheque to be printed. An
enlarged version of the cheque to be printed is shown in figure.
Click on Print to generate a hard copy of the cheque format.
Figure 4.30 Accounting voucher creation – Purchase item invoice – Interest parameters
6. Accept the interest parameters screen and the purchase invoice entries.
26) 10-6-2005 Mr. Rai paid carriage inwards of Rs. 400 in cash.
i. Make an entry of the transaction in a Payment voucher
1. Debit Particulars: Carriage Inward Expenses 400.
2. Credit Particulars: Cash 400.
Note: On setting ‘Maintain Cost Centres’ to ‘Yes’ in F11: Features, ‘Cost Centres are applicable’
field is automatically activated in all ledgers grouped under expenses and incomes. Hence,
while recording the above mentioned transaction, select ledger ‘Carriage Inward Expenses’,
highlight it and make an online alteration by pressing Ctrl+Enter. Set the ‘Cost Centres are
applicable’ field to ‘No’.
27) 12-6-2005 Mr. Rai sold the following items to Java Trading Company on credit for
45 days. Interest charged is at 15% per annum, if payment is not made
within the credit period.
Item Quantity Rate Value VAT Total
Rate Amount
High Capac- 25 900 22500 12.5% 25313
ity stabilisers
Submersible 30 2500 75000 4% 78000
Pumps
Gross Total 103313
Note: Mr. Rai wants to segregate the local and outstation debtors’ accounts. Hence, he asks his
accountant to create sub-groups under the primary group sundry debtors as depicted in the
chart.
Figure 4.31 Chart representing the primary group (Sundry Debtors) and its sub groups
i. Create group Local Debtors (under Sundry Debtors)
Figure 4.33 Accounting voucher creation – Sales item invoice – Interest parameters
6. Accept the interest parameters screen and the sales invoice entries.
Note: In Tally, method of recording a sales item invoice is similar to that of recording a purchase
item invoice. The only difference is that purchase accounts are replaced with sales accounts.
28) 15-6-2005 Mr. Rai withdrew Rs. 5000 in cash for personal use.
i. Make an entry of the transaction in a Payment voucher
1. Debit Particulars: Anurag Rai Drawings 5000.
2. Credit Particulars: Cash 5000.
29) 20-6-2005 Mr. Rai deposited cash of Rs. 40000 to ICICI bank.
i. Make an entry of the transaction in a Contra voucher
1. Credit Particulars: Cash 40000.
2. Debit Particulars: ICICI Bank 40000.
30) 27-6-2005 Mr. Rai paid Rs. 2000 in cash to Mr. Jairam Sengupta as salary
advance.
Note: Salary advance is to be adjusted in four equal instalments.
i. Create ledger Salary Advance (under Loans and Advances (Assets))
Note: Set the field ‘Cost Centres are applicable?’ to ‘Yes’ at the time of salary advance ledger
creation.
i. Create ledgers Prepaid Insurance (under Current Assets) and Electricity Expenses (under
Indirect Expenses)
Figure 4.34 Detailed Trial Balance – 1st April 2005 to 30th June 2005
2. Ensure that the entries in the accounting detail screen are as given in the table.
Name of Item Particulars VAT/Tax Class Amount
High Capacity Stabilisers Purchases @ 12.5% Purchases @ 12.5% 32500
Low Capacity Stabilisers Purchases @ 12.5% Purchases @ 12.5% 8000
37) 19-7-2005 Mr. Rai paid by cheque to Pacific Traders towards bill dated 8-6-2005.
Note: Due to late payment (11 days), Mr. Rai has to pay interest (appli-
cable at the rate of 10% per annum) in addition to the bill amount.
i. Create ledger Interest Due (under Indirect Expenses)
6. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of ref Name Due Date or Credit Days Amount Dr/Cr
New Ref C/N-001 ⎯ 1945 Cr
7. Ensure that the interest parameters are as given in the table.
Rate Per On
10% 365-Day Year Credit Balances Only
8. Debit Particulars: Interest Due 1945.
38) 20-7-2005 Mr. Rai introduced a sales offer and sold the following items on credit
to Java Trading Company and Data Tech Services.
Item Sold Free Total Rate Value Output Total
Qty of Qty VAT Amt
cost (%)
JAVA TRADING COMPANY
High 20 2 22 750 15000 12.5 16875
Capac-
ity Stabi-
liser
Low 5 1 6 450 2250 12.5 2531
Capac-
ity Stabi-
liser
Gross Total 19406
DATA TECH SERVICES
High 30 3 33 750 22500 12.5 25312
Capac-
ity Stabi-
liser
Low 15 3 18 450 6750 12.5 7594
Capac-
ity Stabi-
liser
Gross Total 32906
2. Ensure that the entries in the accounting details screen are as given in the table.
Name of Item Particulars VAT/Tax Class Amount
High Capacity Stabilisers Sales @ 12.5% Sales @ 12.5% 32500
Low Capacity Stabilisers Sales @ 12.5% Sales @ 12.5% 8000
3. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of Ref Name Due Date or Credit Days Amount Dr/Cr
New Ref S-JTC-02 45 Days 19406 Dr
4. Ensure that the interest parameters are as given in the table.
Rate Per On
15% 365-Day Year Debit Balances Only
ii. Make an entry of the transaction in a Sales voucher – Data Tech Services
Note: Follow the same approach as mentioned for Java Trading Company to account for sales
made to Data Tech Services. Ensure that the corresponding entries are made as given in the
sales details for Data Tech Services.
39) 22-7-2005 Mr. Rai received a cheque from Java Trading Company and Data Tech
Services in settlement of bill dated 20-7-2005.
i. Create ledgers Advertisement Expenses and Donation Expenses (both under Indirect
Expenses)
Figure 4.40 Detailed Trial Balance 1st April 2005 to 31st July 2005
Bank statement for the period 1-4-2005 to 4-8-2005 sent to Smart Agencies from ICICI bank is as
follows.
DATE PARTICULARS DEPOSITS WITHDRAWALS BALANCE
2-4-2005 Cheque No: 187962 Deposited 1500000 1500000
(Anurag Rai Capital)
3-4-2005 Cheque No: 123451 (Cash With- 50000 1450000
drawn)
8-4-2005 Cheque No:123452 (Furniture 150000 1300000
and Fixtures)
10-4-2005 Cheque No: 123453 (As Security 25000 1275000
Deposit)
13-4-2005 Cheque No: 123454 (For Assets 75500 1199500
Purchased)
2-5-2005 Cheque No: 123455 (Salary 6900 1192600
paid)
6-5-2005 Cheque No: 123456 (Rent paid) 3500 1189100
19-5-2005 Cheque No: 123457 (Issued to 396500 792600
A2Z Traders)
4-6-2005 Cheque No: 123458 (Cash with- 11000 781600
drawn for Petty cash)
7-6-2005 Cheque No: 123459 (Salary 11500 770100
paid)
20-6-2005 Cash (Cash deposited) 40000 810100
4-7-2005 Cheque No: 123460 11000 753537
(Salary paid)
17-7-2005 Cheque No: 123461 (Purchases 45563 81660
made)
1-8-2005 Cheque No: 123462 (Issued to 647395 106142
Pacific Merchants)
3-8-2005 Cheque deposited (Java Trad- 52312 158454
ing Company)
4-8-2005 Cheque deposited (Data Tech 61875 220329
Services)
Figure 4.41 Bank Reconciliation – 1st April 2005 to 31st July 2005
48) 28-8-2005 Mr. Rai received cheque from Java Trading Company towards the bill
dated 12-6-2005.
i. Create ledger Interest Accrued (under Indirect Incomes)
49) 29-8-2005 Mr. Rai received the statement of expenditure from petty cashier for
the month end, 31-8-2005. The statement is as follows.
Nature of Expense Amount
Cell phone bill paid Rs. 800
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 400
Electricity bills paid Rs. 350
Figure 4.42 Detailed Trial Balance – 1st April 2005 to 31st August 2005
52) 6-9-2005 Mr. Rai purchased items on credit from A2Z Traders. The details are
as follows.
Item Quantity Rate Value Output Total
VAT Amount
Low Capacity 110 500 55000 12.5% 61875
Stabilisers
Submersible 50 2100 105000 4% 109200
Pumps
Gross Total 171075
i. Make an entry of the transaction in a Purchase voucher
Note: Ensure that As Invoice and Item Invoice buttons are activated. This is because the
purchase entry has to be recorded as an item invoice.
1. Party’s A/c Name: A2Z Traders.
2. Ensure that the invoice entries are as given in the table.
Name of Item Quantity Rate Per Amount
Low Capacity Stabilisers 110 nos 500 nos 55000
Submersible Pumps 50 nos 2100 nos 105000
Input VAT @ 12.5% ⎯ 12.50% ⎯ 6875
Input VAT @ 4% ⎯ 4% ⎯ 4200
3. Ensure that accounting details are as given in the table.
Name of Item Particulars VAT/Tax Class Amount
Low Capacity Stabilisers Purchases @ 12.5% Purchases @ 12.5% 55000
Submersible Pumps Purchases @ 4% Purchases @ 4% 105000
4. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of Ref Name Due Date or Credit Days Amount Dr/Cr
New Ref P-A2Z-03 ⎯ 171075 Cr
5. Accept the purchase invoice entries.
53) 10-9-2005 Mr. Rai sold items on credit to Data Tech Services and drew a bill of
exchange for 30 days which was duly accepted by them.
Item Quantity Rate Value Input Total
VAT Amount
Low Capacity 100 550 55000 12.5% 61875
Stabilisers
Submersible 50 2500 125000 4% 130000
Pumps
Gross Total 191875
As per accounting conventions
Data Tech Services Dr. Rs. 191875.
To Sales @ 12.5% Cr. Rs. 55000.
To Sales @ 4% Cr. Rs. 125000.
To Output VAT @ 12.5% Cr. Rs. 6875.
To Output VAT @ 4% Cr. Rs. 5000.
54) 15-9-2005 Mr. Rai withdrew Rs. 6000 from ICICI bank for personal use.
i. Make an entry of the transaction in a Bank Payment voucher
1. Debit Particulars: Anurag Rai Drawings 6000.
2. Credit Particulars: ICICI Bank 6000.
55) 17-9-2005 Mr. Rai sold the following items on credit of 45 days to Java Trading
Corporation.
Item Quantity Rate Value Input Total
VAT Amount
High Capac- 80 700 56000 12.5% 63000
ity Stabilisers
Submersible 60 2300 138000 4% 143520
Pumps
Gross Total 206520
4. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of ref Name Due Date or Credit Days Amount Dr/Cr
New Ref S-JTC-03 45 Days 206205 Dr
5. Ensure that interest parameters are as given in the table.
Rate Per On
15% 365-Day Year Debit Balances Only
6. Accept the sales invoice entries.
56) 22-9-2005 Mr. Rai returned 10 low capacity stabilisers to A2Z Traders purchased
on 6-9-2005 as they were not according to the specifications.
7. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of Ref Name Due Date or Credit Days Amount Dr/Cr
Agst Ref P-A2Z-03 ⎯ 5625 Dr
8. Accept the debit note entries.
57) 28-9-2005 Mr. Rai received the statement of expenditure from petty cashier for
the month-end, 30-9-2005. The statement is as follows.
Nature of Expense Amount
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 550
Electricity charges Rs. 350
Figure 4.43 Detailed Trial Balance – 1st April 2005 to 30th September 2005
6. Ensure that the entries in the accounting details screen are as given in the table.
Name of Item Particulars VAT/Tax Class Amount
High Capacity Stabilisers Sales @ 12.5% Sales @ 12.5% 10500
Submersible Pumps Sales @ 4% Sales @ 4% 23000
7. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of Ref Name Due Date or Credit Days Amount Dr/Cr
Agst Ref S-JTC-03 45 Days 35733 Cr
8. Accept the credit note entries.
61) 2-10-2005 Mr. Rai issued a cheque of Rs. 7500 to petty cashier.
i. Make an entry of the transaction in a Contra voucher
1. Credit Particulars: ICICI Bank 7500.
2. Debit Particulars: Petty Cash 7500.
62) 4-10-2005 Mr. Rai paid salaries and rent of shop by cheque for the month of Sep-
tember 2005.
Note: Adjust the salary advance of Rs. 500 (4th instalment) given to
Mr. Jairam Sengupta.
i. Make an entry of the transaction in a Bank Payment voucher
1. Debit Particulars: Salary Expenses 11500.
2. Debit Particulars: Rent Expenses 3500.
3. Credit Particulars: Salary Advance 500.
4. Credit Particulars: ICICI Bank 14500.
Note: In the cost centre allocation for salary expenses and salary advance screens enter the
required details.
63) 10-10-2005 Mr. Rai deposited the bills receivable drawn on Data Tech Services
which was duly honoured.
i.Make an entry of the transaction in a Bank Receipt voucher
1. Credit Particulars: Bills Receivable 191875.
2. Debit Particulars: ICICI Bank 191875.
64) 20-10-2005 Mr. Rai sold the following items to Seacrest Trading Corporation on
credit:
Item Qty Rate Value Output Total
VAT Amount
Open Well 200 1900 380000 4% 395200
Pumps
67) 29-10-2005 Mr. Rai received the statement of expenditure from the petty cashier
for the month end, October 2005. The statement is as follows.
Nature of Expense Amount
Cell phone bill Rs. 1500
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 450
Electricity charges Rs. 400
Figure 4.44 Detailed Trial Balance – 1st April 2005 to 31st October 2005
Note: As the accountant had no information about the electric heater classification, he grouped
it under stabilisers.
i. Create ledger Icon Enterprises (under Outstation Creditors)
76) 29-11-2005 Mr. Rai received the statement of expenditure from the petty cashier
for the month of November 2005. The statement is as follows.
Nature of Expense Amount
Cell phone bill Rs.1100
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 500
Electricity charges Rs. 300
Figure 4.46 Detailed Trial Balance – 1st April 2005 to 30th November 2005
82) 18-12-2005 Mr. Rai sold the following items for cash in an exhibition organised by
V-Guard company.
Item Quantity Rate Value Output Total
High Capac- 35 850 29750 12.5% 33468
ity Stabilisers
Electric 30 550 16500 12.5% 18562
Heater
Open Well 25 1800 45000 4% 46800
Pumps
Submersible 20 2400 48000 4% 49920
Pumps
Gross Total 148751
84) 29-12-2005 Mr. Rai received the statement of expenditure from petty cashier for
the month of December 2005. The statement is as follows.
Nature of Expense Amount
Cell phone bill Rs. 1200
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 450
Electricity charges Rs. 400
Figure 4.47 Detailed Trial Balance – 1st April 2005 to 31st December 2005
91) 12-1-2006 Mr. Rai decides to have a price list for his customers, levels were
decided on the basis of old and new customers and also the volume of
items purchased by customers.
PRICE LIST FOR OLD CUSTOMERS
Items 0-20 Dis- 20-50 Dis- 50- Dis-
count count above count
High Capac- 850 Nil 850 5% 850 7%
ity Stabilisers
Open Well 1600 2% 1600 5% 1600 6%
Pumps
PRICE LIST FOR NEW CUSTOMERS
Items 0-20 Dis- 20-50 Dis- 50- Dis-
count count above count
Submersible 2500 Nil 2500 4% 2500 8%
Pumps
The method of creating price list for new customers is same as that for old customers. Ensure
that the price list details for new customers are as given in the table.
Name of Item Quantities Rate Discount % (if any)
From Less than
⎯ 20 nos 2500/nos ⎯
Submersible Pumps 20 nos 50 nos 2500/nos 4%
50 nos ⎯ 2500/nos 8%
92) 14-1-2006 Mr. Rai sold the following items to Soft Touch traders.
Item Qty Rate Dis- Value Output Total
count VAT Value
Submersible 30 2500 4% 72000 4% 74880
Pumps
96) 30-1-2006 Mr. Rai received statement of expenditure from the petty cashier for
the month of January 2006. The statement is as follows:
Nature of Expense Amount
Cell phone bill Rs. 800
Conveyance expenses of marketing executives Rs. 500
Shop maintenance expenses Rs. 450
Electricity charges Rs. 350
Figure 4.51 Detailed Trial Balance – 1st April 2005 to 31st January 2006
4. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of Ref Name Due Date or Credit Days Amount Dr/Cr
New Ref P-PM-02 ⎯ 74925 Cr
5. Ensure that the interest parameters are as given in the table below:
Rate Per On
10% 365-Day Year Credit Balances Only
6. Accept the purchase invoice entries.
102) 12-2-2006 Mr. Rai sold the following items to Java Trading Company on credit
Item Qty Rate Dis- Value Input Total
count VAT Amount
High 30 850 5% 24225 12.5% 27253
Capacity
Stabilisers
Open well 40 1600 5% 60800 4% 63232
pumps
Gross Total 90485
Note: Create sales voucher class - 'Sales @ 12.5%' and record the sales transactions in differ-
ent sales vouchers using the corresponding voucher class.
i.Alter the Sales voucher type
1. Go to Gateway of Tally > Accounts Info. > Voucher Types > Alter > select Sales from the
list of voucher types.
2. In the voucher type alteration screen, highlight 'Sales @ 4%' and use down arrow key to add
another class 'Sales @ 12.5%' in the 'Name of Class' field.
3. Retain the rest of the fields as they are.
4. Ensure that voucher type class is defined as shown in figure.
ii. Make an entry of the transaction in a Sales voucher - voucher class 'Sales @ 12.5%'
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales > select Sales @ 12.5%
from the class table to view a sales voucher displaying voucher class as Sales @ 12.5%.
2. Party’s A/c Name: Java Trading Company.
3. Price level: Old Customers.
4. Ensure that the sales invoice entries are as given in the table.
Name of Item Quantity Rate Per Discount % Amount
High Capacity Stabilisers 30 nos 850 nos 5% 24225
Output VAT @ 12.5% ⎯ 12.50% ⎯ ⎯ 3028
5. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of Ref Name Due Date or Credit Days Amount Dr/Cr
New Ref S-JTC-04 45 Days 27253 Dr
6. Ensure that the interest parameters are as given in the table.
Rate Per On
15% 365-Day Year Debit Balances Only
7. Accept the sales invoice entries.
iii. Make an entry of the transaction in a Sales voucher - Voucher class 'Sales @ 4%'
Note: Follow the same approach as mentioned for voucher class 'Sales @ 12.5%'. Replace
12.5% with 4% and ensure that the corresponding entries are made as given in the sales
details for the item open well pumps.
103) 14-2-2006 Mr. Rai purchased the following items from WinTech Information Sys-
tems, Hyderabad on credit.
Item Quantity Rate Value Input Total
CST Amount
Low capacity 50 450 22500 4% 23400
stabilisers
i. Create ledgers WinTech Information Systems (under Outstation Creditors)
Note: Pricing level applicable: select Not Applicable from price levels list at the time of ledger
creation. In the mailing and related details select state as ‘Andhra Pradesh’.
107) 27-2-2006 Mr. Rai received the statement of expenditure from the petty cashier
for the month end, February 2006. The statement is as follows.
Nature of Expense Amount
Cell phone bill paid Rs. 1300
Conveyance expenses Rs. 700
Electricity bills paid Rs. 450
Shop maintenance expenses Rs. 400
Figure 4.54 Detailed Trial Balance – 1st April 2005 to 28th Febraury 2006
112) 18-3-2006 Mr. Rai sold the following items to Seacrest Trading Corporation on
credit.
Item Quantity Rate Value Output Total
VAT Amount
High capacity 5 950 4750 12.5% 5343
stabilisers
Low capacity 15 750 11250 12.5% 12657
stabilisers
Gross Total 18000
i.Make an entry of the transaction in a Sales voucher - Voucher class Sales @ 12.5%
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales > select Sales @ 12.5% from
the class table to view a sales voucher displaying voucher class as Sales @ 12.5%.
2. Party's A/c Name: Seacrest Trading Corporation.
3. Price level: Not applicable.
4. Ensure that the sales invoice entries are as given in the table.
Name of Item Quantity Rate Per Discount % Amount
High Capacity Stabilisers 5 nos 950 nos ⎯ 4750
Low Capacity Stabilisers 15 nos 750 nos ⎯ 11250
Output VAT @ 12.5% ⎯ 12.5% ⎯ ⎯ 2000
5. Ensure that the entries in the bill-wise details screen are as given in the table.
Type of Ref Name Due Date or Credit Days Amount Dr/Cr
New Ref S-STC-04 ⎯ 18000 Dr
113) 20-3-2006 Mr. Rai withdrew Rs. 5000 from bank for personal use.
i. Make an entry of the transaction in a Bank Payment voucher
1. Debit Particulars: Anurag Rai Drawings 5000.
2. Credit Particulars: ICICI Bank 5000.
114) 30-3-2006 Mr. Rai received the statement from the petty cashier for the month of
March 2006. The statement is as follows:
Nature of Expense Amount
Cell phone bill Rs. 1800
Conveyance expenses Rs. 700
Electricity charges Rs. 500
Shop maintenance Rs. 350
i. Make an entry of the transaction in a Journal voucher
1. Debit Particulars: Telephone Expenses 1800.
2. Debit Particulars: Conveyance Expenses 700.
3. Debit Particulars: Electricity Expenses 500.
4. Debit Particulars: Shop Maintenance Expenses 350.
5. Credit Particulars: Petty Cash 3350.
115) 31-3-2006 VAT adjustment entry
i. Make an entry of the transaction in a Journal voucher
1. Debit Particulars: Output CST @ 4 % 4120.
2. Debit Particulars: Output VAT @ 12.5 % 2000.
3. Credit Particulars: VAT adjustment A/c 6120.
116) 31-3-2006 Provision entry to transfer balance from VAT adjustment account to
VAT Payable account.
Note: As per guidance note on accounting for state-level Value Added Tax issued by the ICAI,
the debit balance in VAT credit receivable (inputs) account, at the year end, should be shown
on the "Assets" side of the balance sheet under the head "Loans and Advance".
At the year end, if the VAT adjustment account has a debit balance, a new ledger 'VAT Credit
Balance Account' under 'Loans and Advances (Asset)' is created and the debit balance is trans-
ferred to the new account created to adhere to the guidance note issued by ICAI.
i. Make an entry of the transaction in a Journal voucher
1. Debit Particulars: VAT Adjustment A/c 4015.
2. Credit Particulars: VAT Payable 4015.
Closing Entry
SL. NO. TRANSACTION
1) Transfer of profit and loss account to Anurag Rai capital account.
i. Make an entry of the transaction in a Journal voucher
1. Debit Particulars: Profit & Loss A/c (pre-defined ledger) 20155.
2. Credit Particulars: Anurag Rai Capital A/c 20155.
Figure 4.55 Detailed Trial Balance – 1st April 2005 to 31st March 2006
Lesson Objectives
Upon completion of this lesson you will be able to.
Generate accounting and inventory reports.
Print accounting and inventory reports.
View statutory masters in Tally.
Introduction
Report generation is a powerful tool in Tally, which puts the user in charge of his business information
The display of information entered in Tally, helps the user
prepare his financial statements based on the vouchers entered to date
present strategic information in a manner that would aid his decision making and control.
Tally reports are generated in real-time, and the user has infinite options to display the information in
the manner that he requires. .
For example, consider that the market value of stock on 31-3-2006 is Rs. 40000. To depict this
amount as the closing stock value:
Deactivate 'Integrate Accounts and Inventory' in F11: Features.
Create ledger Stock (under Stock-in-Hand).
Alter ledger Stock
In the field, Closing Balance: Specify date as March 31, 2006 and value as 40000.
Figure 5.3 Detailed Balance Sheet with altered Closing Stock Value
When the balances are carried forward to the next year, the opening value of stock would be taken
as 40000. This is applicable only when 'Integrate Account and Inventory' in F11: Features is
deactivated. Once this feature is activated, the manual entry is overwritten by the value calculated
automatically by Tally. Tally allows the flexibility of toggling between integration and disintegration of
accounts and inventory.
Note: As all other reports explained in this lesson consider integration of accounts with inventory,
activate 'Integrate Accounts and Inventory' in F11: Features.
Figure 5.4 Detailed Profit and Loss Account in Vertical Format with Percentages
The vertical form always shows the trading account and the income statements separately. Each line
(in condensed view) is expressed as a percentage of sales accounts. Sales accounts will be 100%
and the rest of the lines will be a percentage of sales accounts.
To view inventory-wise extract of sales register, click on F12: Configure and alter settings as
required.
Purchase Register
Purchase register displays the monthly summary of all purchases made.
Cost Centres
Cost centre reports are primarily performance reports.
Go to Gateway of Tally > Display > Statements of Accounts > Cost Centers.
Ledger Break-up
Ledger break-up is another view of a cost centre report. It enables the user to analyse the distribution
of a ledger account amongst different cost centres.
Select a ledger from the list of ledgers. For example, select Salary Expenses and press
Enter to view cost break-up of ledger.
The cost break-up of ledger, Salary Expenses is as shown in figure.
Outstandings
Receivables and payables are two important components of any firm's working capital and indeed its
business activity. Receivables are a part of current assets whereas payables are a part of current lia-
bilities. Each influences the short-term liquidity and financing of the company. Effective control of
both types of outstandings is necessary for the financial health of the firm. Tally provides many
reports and analysis to aid credit control.
Receivables
Receivables are amounts which are outstanding from debtors.
To view receivables
Go to Gateway of Tally > Display > Statements of Accounts > Outstandings > Receiva-
bles
Payables
Payables are amounts which are outstanding to the creditors.
To view payables
Go to Gateway of Tally > Display > Statements of Accounts > Outstandings > Payables
Interest Calculations
In Tally, interest is automatically calculated if 'Activate Interest Calculation' and 'Use Advanced
Parameters' features are activated in F11: Features and the related parameters are set as required
for individual ledger accounts.
Output VAT @ 4%
Output VAT @ 12.5%
Purchases – Capital Goods
Purchases – Exempt
Purchases from unregistered dealers
Depending on the type of the business, type of transaction, and the statutory requirements of a state,
appropriate classifications have to be selected from the list during ledger creations, voucher entries,
etc.
The sales and purchase transactions are segregated based upon the classification selected during
voucher entry and shown in the VAT computation.
VAT Forms
VAT returns are to be filed in the forms prescribed by each state. The form discussed here is Form
100, which is the VAT form for Karnataka. Tally enables printing of VAT form in the specified format.
CST Reports
CST Reports display forms to be received and issued. It allows you to track pending forms and
reconcile forms.
Form Receivable
This displays the CST forms receivable for the statutory reports from the CST Party Ledgers.
Go to Gateway of Tally > Display > Statutory Reports > CST Reports > Form Receiva-
ble
Select a CST party ledger from the list of ledgers displayed. For example, select State Trade
Corporation, Mumbai.
Forms to be received for the selected ledger are displayed in the Forms Receivable screen.
Figure 5.20 CST Reports – Form Receivable – State Trade Corporation, Mumbai
Enter in the Form Number and Date for forms received.
Accept to save.
Form Issuable
This displays the CST forms issuable for the statutory reports from the CST Party Ledgers.
Go to Gateway of Tally > Display > Statutory Reports > CST Reports > Form Issuable
Select a CST party ledger from the list of ledgers displayed. For example, select WinTech
Information Systems.
Forms to be issued for the selected ledger are displayed in the Forms Issuable screen.
If a transaction has not been completed, the user may not want it to affect the accounts. In such a
case, record it and at a later time simply modify the voucher and remove the 'optional' by 'regular-
ising' it.
View the balance sheet to see the effect of marking two vouchers as optional vouchers.
Stock Summary
Stock Summary is a statement of stock in hand on a particular date. The statement is updated with
every transaction to provide stock position at any given time.
Tally treats stock summary as one of the primary statements and makes it accessible directly from
the Gateway of Tally.
The statement can be drilled down as with all Tally reports and configured to view different details.
Indeed, it is possible to see the total flow of stock on a single report.
Experiment with the different buttons for this purpose.
Inventory Books
Stock Item
Stock item summary is a statement which displays the inwards, outwards and the closing balance
details of a selected stock item on a monthly basis.
POS system is a computerised cash register which adds up the sales totals, calculates the balance
to be returned to buyer and automatically adjusts the inventory levels to reflect the quantity sold. The
equipment required for POS to work effectively are cash registers, card readers, bar-code scanners
and so on.
Tally’s Point of Sale module makes it easy to streamline your retail operations by automating the
‘Check out’ process for your customers. It takes a one-time configuration in Tally for POS features to
be activated.
Tally’s point of sale application can search your inventory database not only on item description or
SKU but by alias name, part number, keywords and so on. Stock summary reports can be used for
viewing group-wise, category-wise, godown-wise, batch-wise, supplier-wise details of the stock
items.
Create a new company in Tally 7.2 with ‘Accounts with Inventory’. The completed Company
Creation screen will appear as shown in figure.
Set Standard Rates?: Set ‘Yes’. This displays a screen where the standard rates can be
specified.
Under Standard Cost, specify the rate as 15 and under Standard Selling Price
specify the rate as 20.
The date in the field Applicable from is 1-4-2005.
The Standard Rates screen appears as shown.
Note:
To view the field Set Standard Rates’, activate Allow Standard Rates for Stock Items in
F12: Configure.
In the alias column, the bar code details can be captured by simply scanning the bar code
of the stock item using a bar code reader.
Recording Transactions
Choice Supermarkets purchased 100 numbers of ‘Pepsodent 150g’ at the rate of Rs. 15 on 1-4-
2005. Make an entry in a purchase voucher to record this transaction.
Choice Supermarkets sold 5 numbers of ‘Pepsodent 150g’ for a total of Rs. 100 on 2-4-2005. The
customer pays Rs. 50 by credit card, Rs. 30 by cheque and Rs. 20 by cash. The sales voucher to
record this transaction is entered as follows
Go to Gateway of Tally > Accounting Vouchers > F8: Sales
Select the voucher type as POS Invoice.
Press F2 and change the date to 2-4-2005.
Click on the button Multi Mode Payment.
Select the sales ledger as Sales.
Select the Name of Item as Pepsodent - 150g.
(Alternatively, the bar code on the stock item can be scanned with the help of the bar code
reader and all the details are captured automatically. This is useful when there are
numerous stock items and manual entry of each item proves to be a time consuming task.)
By default, Tally displays the rate and amount for one unit of the stock item selected. To
change the quantity, use the backspace key to shift the cursor on to the quantity column.
Type 5 and press Enter to update the rate and amount details.
Note: If Set Standard Rates is activated, Tally does not allow manual entry of rate for stock
items.
In the columns pertaining to payment details make the following entries.
Gift Vouchers: Payment received through gift vouchers is entered here. Select Not
Applicable.
Credit/Debit Card Payment: Select the name of the bank with which you have the
arrangement for collecting the card receivables. Select HSBC Bank. (Press ALT+C to
create the ledger HSBC Bank - under Bank Accounts). The amount is automatically
filled with the amount of the invoice, 100. Type 50 . This will prompt you to enter the
card number. Type ‘7007526477100088’ and press Enter.
Cheque: Enter the name of the bank in which you deposit the cheques. Select HSBC
Bank. The amount column is automatically filled with the balance amount receivable,
Type ‘30’ and press Enter. This will take you to the column ‘Bank Name’. Enter the
name of the bank on which the cheque has been drawn. Type ‘Citibank’.Tally will ask
you to fill in the cheque no. Type ‘475630’ and press Enter.
Cash: Select the ledger ‘Cash’ (pre-defined). Tally automatically fills the balance
amount receivable, 20 . Enter the cash tendered by the customer, which is 50. Tally
automatically calculates and displays the balance amount to be refunded as 30.
Skip the narration field by pressing Enter.
The completed POS Invoice screen will appear as shown.
On saving the voucher, Tally asks for a confirmation to print the invoice.
Click With Preview button to see a preview of the invoice and press Enter.
which asks Print? Yes or No. Select Yes print the report using the options specified on the screen. If
selection is No, the print options can be changed before printing.
Multi-Account Printing
Multi-account printing is principally geared towards printing the primary books of accounts, like the
Cash and Bank Books, Account Ledgers, Sales and Purchase Registers etc without needing to
select the accounts one at a time and pressing ALT+P. The facilities provide for printing one account
at a time, all accounts, or all accounts in a selected group. Before printing, the date range and other
selections may also be set up.
Dot matrix format allows the user to print Tally reports in text format using the dot matrix printers. As
Tally is a Windows-based software, it has a print format compatible with dot matrix printers consider-
ing that time taken to print reports should be quick. By default, the Epson printer drivers have been
defined. Any dot matrix printer may be used, but ONLY the Epson printer drivers (LQ and FX series)
should be used for dot matrix format printing of Tally.
The neat mode and quick/draft print modes are compatible with most of the printer drivers installed
on the Windows Operating System. The default behaviour of Tally is to print in neat mode. This can
be altered by pressing ALT+F just before printing. All subsequent reports will be printed in quick/draft
format, until ALT+F is pressed again at the Printing Screen. Almost every report can be printed in
quick/draft mode (except for Cheques).
8) 21-4-2005 Mr. Rai purchased the following items from A2Z traders on credit.
Items Quantity Rate Per Value Input Total
(In num- number VAT Value
bers) (Rs.)
Low Capacity 100 40 4000 12.5% 45000
Stabilisers
Open Well 50 150 7500 4% 78000
Pumps
Submersible 100 200 20000 4% 208000
pumps
Gross Total 331000
9) 22-4-2005 Mr. Rai paid carriage inward expenses of Rs. 500 in cash on
purchases made on 20-4-2005 and 21-4-2005.
10) 27-4-2005 Mr. Rai transferred Rs. 10000 to petty cash from cash to meet the day
to day expenses.
11) 28-4-2005 Mr. Rai withdrew Rs. 5000 in cash for personal use.
12) 30-4-2005 VAT adjustment entry.
MAY 2005
13) 1-5-2005 Mr. Rai paid salaries through cheque for the month of April 2005.
(Cheque number: 123455). The details are as follows:
Name Salary Paid Number of Days
Rahul Bhatt Rs. 2400 18
Jairam Sengupta Rs. 2100 18
Shishir Mathur Rs. 1500 18
Ajith V Nair Rs. 900 18
14) 2-5-2005 Mr. Rai paid Rs. 2500 in cash for stationery, printing invoices and
vouchers to Cannon Traders.
15) 3-5-2005 Mr. Rai received the statement of expenditure from the petty cashier
for the month of April 2005. The statement is as follows
Nature of Expense Amount
Stationery purchased Rs. 2500
Cell phone bill Rs. 600
Shop maintenance expenses Rs. 450
Conveyance expenses of marketing executives Rs. 250
16) 6-5-2005 Mr. Rai paid Rs. 3500 by cheque towards shop rent for the month of
April 2005.
17) 10-5-2005 Mr. Rai sold the following items for cash details are as follows.
Item Quantity Rate Value Output Total
(in VAT Amount
pieces)
High capacity 50 850 42500 12.5% 47813
Stabilisers
Open well 15 1700 25500 4% 26520
pumps
Gross Total 74333
18) 15-5-2005 Mr. Rai issued a cheque to A2Z traders for Rs. 396500 deducting the
Rs. 2000 discount received. He received discount since he agreed to
pay the entire bill amount.
19) 28-5-2005 Mr. Rai withdrew Rs. 4000 in cash for personal use.
20) 30-5-2005 Mr. Rai received the statement of expenditure from the petty cashier
for the month of May 2005. The statement is as follows
Nature of Expense Amount
Cell phone bill Rs. 1500
Conveyance expenses of marketing executives Rs. 800
Shop maintenance expenses Rs. 200
21) 31-5-2005 VAT adjustment entry.
JUNE 2005
22) 3-6-2005 Mr. Rai paid Rs. 3500 in cash towards shop rent for the month of May
2005.
23) 4-6-2005 Mr. Rai issued a cheque of Rs. 11000 to the petty cashier.
24) 6-6-2005 Mr. Rai paid salaries for the month of May 2005 by cheque.
25) 8-6-2005 Mr. Rai purchased the following goods from Pacific Merchants on
credit for 30 days. Interest is to be calculated at 10% per annum.
Items Quantity Rate Value VAT Total
Rate Amount
High capacity 200 65 130000 12.5% 146250
stabilisers
Open well 300 155 480000 4% 499200
pumps
Gross Total 645450
26) 10-6-2005 Mr. Rai paid carriage inwards of Rs. 400 in cash.
27) 12-6-2005 Mr. Rai sold the following items to Java Trading Company on credit for
45 days. Interest charged is at 15% per annum, if payment is not
made within the credit period.
Item Quantity Rate Value VAT Total
Rate Amount
High capacity 25 900 22500 12.5% 25313
stabilisers
Submersible 30 2500 75000 4% 78000
pumps
Gross Total 103313
28) 15-6-2005 Mr. Rai withdrew Rs. 5000 in cash for personal use.
29) 20-6-2005 Mr. Rai deposited cash of Rs. 40000 to ICICI bank.
30) 27-6-2005 Mr. Rai paid Rs. 2000 in cash to Mr. Jairam Sengupta as salary
advance.
31) 28-6-2005 Mr. Rai received the statement of expenditure from the petty cashier
for the month end 30-6-2005. The statement is as follows
Nature of Expense Amount
Insurance premium for the period 1-7-2005 to 30-6-2006 Rs. 2400
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 550
Electricity expenses Rs. 500
32) 29-6-2005 Mr. Rai sold the following items to Data Tech services on credit:
Item Quantity Rate Value VAT Total
Rate Amount
Low capacity 100 550 55000 12.5% 61875
stabilisers
33) 30-6-2005 VAT adjustment entry.
JULY 2005
34) 3-7-2005 Mr. Rai paid the salaries through cheque for the month of June 2005.
35) 6-7-2005 Mr. Rai paid rent in cash for the month of June 2005.
36) 14-7-2005 Mr. Rai purchased the following items under a sales offer. He paid by
cheque.
The offer is as follows
On purchase of 10 high capacity stabilisers 1 HCS is given
free of cost.
On purchase of 5 low capacity stabilisers 1 LCS is given free
of cost.
Item Pur- Free Total Rate Value Input Total
chased of Qty VAT Amt
Qty cost (%)
High 50 5 55 650 32500 12.5 36563
capacity
stabilisers
Low 20 4 24 400 8000 12.5 9000
capacity
stabilisers
Gross Total 45563
37) 19-7-2005 Mr. Rai paid by cheque to Pacific Traders towards bill dated 8-6-2005.
38) 20-7-2005 Mr. Rai introduced a sales offer and sold the following items on credit
to Java Trading Company and Data Tech Services:
Item Sold Free Total Rate Value Output Total
Qty of Qty VAT Amt
cost (%)
JAVA TRADING COMPANY
High 20 2 22 750 15000 12.5 16875
capacity
stabiliser
Low 5 1 6 450 2250 12.5 2531
capacity
stabiliser
Gross Total 19406
DATA TECH SERVICES
High 30 3 33 750 22500 12.5 25312
capacity
stabiliser
Low 15 3 18 450 6750 12.5 7594
capacity
stabiliser
Gross Total 32906
39) 22-7-2005 Mr. Rai received a cheque from Java Trading Company and Data
Tech Services in settlement of bill dated 20-7-2005.
40) 28-7-2005 Mr. Rai received cheque from Data Tech Services towards the bill
dated 29-6-2005.
41) 29-7-2005 Mr. Rai received statement of expenditure from the petty cashier for
the month end, July 2005. The statement is as follows
Nature of Expense Amount
Advertising expenses incurred Rs. 1500
Conveyance expenses of marketing executive Rs. 600
Donation paid to charitable institution Rs. 600
Shop maintenance expenses Rs. 550
Electricity expenses Rs. 500
46) 12-8-2005 Mr. Rai sold the following items to Seacrest Trading Corporation and
allowed a trade discount at the rate of 5%.
Item Quantity Rate Value VAT Total
Rate Amount
High capacity 90 900 76950 12.5% 86569
stabilisers
47) 27-8-2005 Mr. Rai received cheque from Seacrest Trading Corporation towards
the bill dated 12-8-2005.
48) 28-8-2005 Mr. Rai received cheque from Java Trading Company towards the bill
dated 12-6-2005.
49) 29-8-2005 Mr. Rai received the statement of expenditure from petty cashier for
the month end, 31-8-2005. The statement is as follows
Nature of Expense Amount
Cell phone bill paid Rs. 800
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 400
Electricity bills paid Rs. 350
53) 10-9-2005 Mr. Rai sold items on credit to Data Tech Services and drew a bill of
exchange for 30 days which was duly accepted by them.
Item Quantity Rate Value Input Total
VAT Amount
Low capacity 100 550 55000 12.5% 61875
stabilisers
Submersible 50 2500 125000 4% 130000
pumps
Gross Total 191875
54) 15-9-2005 Mr. Rai withdrew Rs. 6000 from ICICI bank for personal use.
55) 17-9-2005 Mr. Rai sold the following items on credit of 45 days to Java Trading
Corporation
Item Quantity Rate Value Input Total
VAT Amount
High capacity 80 700 56000 12.5% 63000
stabilisers
Submersible 60 2300 138000 4% 143520
pumps
Gross Total 206520
56) 22-9-2005 Mr. Rai returned 10 low capacity stabilisers to A2Z Traders purchased
on 6-9-2005 as they were not according to the specifications.
57) 28-9-2005 Mr. Rai received the statement of expenditure from petty cashier for
the month-end, 30-9-2005. The statement is as follows.
Nature of Expense Amount
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 550
Electricity charges Rs. 350
58) 29-9-2005 Mr. Rai received bank statement from ICICI bank and found that Rs.
550 had been charged as half-yearly bank charges.
59) 30-9-2005 VAT adjustment entry.
OCTOBER 2005
60) 1-10-2005 Java trading corporation returned the following items, out of sales
made on 17-9-2005 since they were in excess of their requirements.
Name of Item Quantity
High Capacity Stabilisers 15
Submersible Pumps 10
61) 2-10-2005 Mr. Rai issued a cheque of Rs. 7500 to petty cashier.
62) 4-10-2005 Mr. Rai paid salaries and rent of shop by cheque for the month of Sep-
tember 2005.
63) 10-10-2005 Mr. Rai deposited the bills receivable drawn on Data Tech Services
which was duly honoured.
64) 20-10-2005 Mr. Rai sold the following items to Seacrest Trading Corporation on
credit
Item Qty Rate Value Output Total
VAT Amount
Open well pumps 200 1900 380000 4% 395200
65) 21-10-2005 Mr. Rai issued a cheque to A2Z Traders towards the purchases made
on 6-9-2005.
66) 28-10-2005 Mr. Rai received a cheque from Java Trading Company against sales
made on 17-9-2005.
67) 29-10-2005 Mr. Rai received the statement of expenditure from the petty cashier
for the month end, October 2005. The statement is as follows
Nature of Expense Amount
Cell phone bill Rs. 1500
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 450
Electricity charges Rs. 400
73) 13-11-2005 Mr. Rai asks the accountant to alter the voucher since he wants the
item to be grouped under heaters.
74) 14-11-2005 Mr. Rai paid Rs. 4500 by cheque for the cell phone he purchased for
his sales executive.
75) 15-11-2005 Mr. Rai sold the following items to Seacrest Trading Corporation on
credit.
Item Quantity Rate Value Output Total
VAT Amount
Open well pumps 50 1800 90000 4% 93600
76) 29-11-2005 Mr. Rai received the statement of expenditure from the petty cashier
for the month of November 2005. The statement is as follows
Nature of Expense Amount
Cell phone bill Rs.1100
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 500
Electricity charges Rs. 300
83) 19-12-2005 Mr. Rai paid Rs. 2500 in cash for the space provided in the exhibition.
84) 29-12-2005 Mr. Rai received the statement of expenditure from petty cashier for
the month of December 2005. The statement is as follows:
Nature of Expense Amount
Cell phone bill Rs. 1200
Conveyance expenses of marketing executives Rs. 600
Shop maintenance expenses Rs. 450
Electricity charges Rs. 400
92) 14-1-2006 Mr. Rai sold the following items to Soft Touch traders
Item Qty Rate Dis- Value Output Total
count VAT Value
Submersible 30 2500 4% 72000 4% 74880
Pumps
93) 15-1-2006 Mr. Rai withdrew Rs. 13000 from ICICI bank for personal use.
94) 20-1-2006 Mr. Rai withdrew capital of Rs. 500000 from the firm by cheque.
95) 25-1-2006 Mr. Rai received a cheque from Soft Touch Traders for sales made on
14-01-2006.
96) 30-1-2006 Mr. Rai received statement of expenditure from the petty cashier for
the month of January 2006. The statement is as follows
Nature of Expense Amount
Cell phone bill Rs. 800
Conveyance expenses of marketing executives Rs. 500
Shop maintenance expenses Rs. 450
Electricity charges Rs. 350
102) 12-2-2006 Mr. Rai sold the following items to Java Trading Company on credit
Item Qty Rate Dis- Value Input Total
count VAT Amount
High 30 850 5% 24225 12.5% 27253
capacity
stabilisers
Open well 40 1600 5% 60800 4% 63232
pumps
Gross Total 90485
103) 14-2-2006 Mr. Rai purchased the following items from WinTech Information Sys-
tems, Hyderabad on credit.
Item Quantity Rate Value Input Total
CST Amount
Low capacity 50 450 22500 4% 23400
stabilisers
104) 15-2-2006 Mr. Rai withdrew Rs. 5000 from bank for personal use.
105) 18-2-2006 Mr. Rai purchased the following items from Icon Enterprises on credit.
Item Quantity Rate Value Input Total
VAT Amount
Submersible 30 2200 66000 4% 68640
Pumps
106) 25-2-2006 Mr. Rai sold the following items to Mumbai State Trade Corporation
(Government Department) on credit.
Item Quantity Rate Value Output Total
CST Amount
Submersible 40 2500 100000 4% 104000
Pumps
107) 27-2-2006 Mr. Rai received the statement of expenditure from the petty cashier
for the month end February 2006. The statement is as follows.
Nature of Expense Amount
Cell phone bill paid Rs. 1300
Conveyance expenses Rs. 700
Electricity bills paid Rs. 450
Shop maintenance expenses Rs. 400
MARCH 2006
109) 5-3-2006 Mr. Rai paid salaries and rent by cheque for the month of February
2006.
110) 10-3-2006 Mr. Rai honoured the bills payable which was drawn by Pacific Mer-
chants by issuing cheque.
111) 15-3-2006 Mr. Rai sold the following items on credit to Sun-Shine Traders, Ker-
ala.
Item Qty Rate Output Total
CST Amount
High capacity stabilisers 30 850 4% 25500
Open well pumps 50 1550 4% 77500
Gross Total 107120
112) 18-3-2006 Mr. Rai sold the following items to Seacrest Trading Corporation on
credit.
Item Quantity Rate Value Output Total
VAT Amount
High capacity 5 950 4750 12.5% 5343
stabilisers
Low capacity 15 750 11250 12.5% 12657
stabilisers
Gross Total 18000
113) 20-3-2006 Mr. Rai withdrew Rs. 5000 from bank for personal use.
114) 30-3-2006 Mr. Rai received the statement from the petty cashier for the month of
March 2006. The statement is as follows:
Nature of Expense Amount
Cell phone bill Rs. 1800
Conveyance expenses Rs. 700
Electricity charges Rs. 500
Shop maintenance Rs. 350
115) 31-3-2006 VAT adjustment entry
116) 31-3-2006 Provision entry to transfer balance from VAT adjustment account to
VAT Payable account.
Closing Entry
SL. NO. TRANSACTION
1) Transfer of profit and loss account to Anurag Rai capital account.
Additional Information
The profit and losses are shared equally by the partners.
Interest on capital is paid to the partners @ 6% per annum on the opening balances of their
respective capital accounts.
Partners are paid monthly salary of Rs. 4000 each.
Partners decide to have separate vouchers for bank payments and receipts. Hence, two
new voucher types Bank Payment under Payment and Bank Receipt under Receipt have
to be created.
Activate ‘Maintain Cost Centers’ in F11: Features. Here cost centers are used for salary
expenses and incentives to staff.
Activate ‘Integrate Accounts with Inventory’ in F11: Features.
Partners decide to maintain their accounts on Tally ies 7.2 from 1-4-2005. The transactions
of the firm for the year 2005-06 are as under. You are required to
Enter opening balances from the balance sheet as at 1-4-2005.
Record the transactions.
Prepare financial statements.
Figure A.1 Detailed Trial Balance – 1st April 2005 to 30th April 2005
MAY 2005
12) 2-5-2005 Partners paid salaries to staff for the month of April 2005 by cheque.
13) 5-5-2005 Partners paid telephone bill of Rs. 1200 in cash for the month of April
2005.
14) 9-5-2005 Partners received cheque from Ganesh Technologies in settlement of
the bill dated 10-4-2005.
15) 12-5-2005 Partners sold the following items to Paramount Services and Peripher-
als on credit of 14 days.
Item Quantity Rate Value VAT Total
Rate
Processors 20 6500 130000 4% 135200
Hard disks 20 4000 80000 4% 83200
Printers 5 11500 57500 4% 59800
Total Amount 278200
16) 13-5-2005 Partners issued cheque for Income Tax (2004-05) amounting to
Rs. 15000.
17) 15-5-2005 Partners withdrew cash from the bank Rs. 15000 for office use.
18) 27-5-2005 Partners received Rs. 278200 by cheque from Paramount Services
and Peripherals for the sales made on 12-05-2005.
19) 28-5-2005 Partners paid Omega Infotech Rs. 100000 and Pigeon One Tech
Services Rs. 20500 towards purchases made in the last year. Both the
payments are made by cheque.
20) 30-5-2005 Partners received salaries for the month of May 2005 by cheque.
21) 31-5-2005 VAT adjustment entry.
24) 25-6-2005 Partners purchased the following items from Pigeon One Tech Serv-
ices on credit.
Item Quantity Rate Value VAT Total
Rate
Monitor 15 10200 153000 4% 159120
UPS 22 1600 35200 4% 36608
Total Amount 195728
25) 26-6-2005 Partners settled the bill of Pigeon One Tech Services dated 25-6-2005
by cheque.
26) 27-6-2005 Partners paid Rs. 1100 towards electricity charges for the month of
April and May by cheque.
27) 28-6-2005 Purchased the following item from X–Vault Computers paying by
cheque.
Item Quantity Rate Value VAT Total
Rate Amount
UPS 25 1550 38750 4% 40300
28) 29-6-2005 Partners received salaries for the month of June 2005 by cheque.
29) 30-6-2005 VAT adjustment entry.
33) 4-7-2005 Partners purchased the following items from Estrada Tech on credit for
90 days. Interest is payable @10% per annum.
Note: Use advanced parameters for interest calculation, specify that
interest is calculated from the ‘Due Date’ on ‘Credit Balances only’.
Item Quantity Rate Value VAT Total
Rate Amount
Monitors 25 10000 250000 4% 260000
34) 5-7-2005 Partners paid telephone bill of Rs. 1500 in cash for the month of June
2005.
35) 24-7-2005 Partners honoured the bill of exchange by issuing a cheque to Bon-
afide Peripherals and Systems.
36) 26-7-2005 Partners sold the following items to I-Tech Peripherals on credit for a
period of 15 days with a trade discount @ 5%.
Note: Set Yes to separate discount column in F11 features.
Item Qty Rate Discount Value VAT Amount
Rate
Processor 15 7500 5% 106875 4% 111150
Monitors 10 12500 5% 118750 4% 123500
UPS 5 2800 5% 13300 4% 13832
Total Amount 248482
37) 28-7-2005 Partners paid Rs. 1200 towards electricity charges for the month of
June 2005 in cash.
38) 30-7-2005 Partners received salaries for the month of July 2005 by cheque.
39) 31-7-2005 VAT adjustment entry.
Figure A.4 Detailed Trial Balance – 1st April 2005 to 31st July 2005
AUGUST 2005
40) 2-8-2005 Partners paid salaries to staff for the month of July 2005 by cheque.
41) 5-8-2005 Partners paid telephone bill of Rs. 1500 in cash for the month of July
2005.
42) 10-8-2005 Partners received a cheque of Rs. 248482 from I-Tech Peripherals in
settlement of bill dated 26-7-2005.
43) 11-8-2005 Partners purchased the following items from X-Vault Computers on
credit for a period of 45 days.
Item Quantity Rate Value VAT Total
Rate
Processors 10 5100 51000 4% 53040
Hard disks 15 2700 40500 4% 42120
Monitors 10 10100 101000 4% 105040
Total Amount 200200
44) 12-8-2005 Partners sold the following items to Tech Savvy Technologies on credit
for a period of 30 days.
Note: Interest will be charged @ 10% per annum, use advanced
parameters where specify that interest is calculated from the ‘Due
Date’ and ‘ Debit balances only’
Item Quantity Rate Value VAT Total
Rate
Processors 15 6500 97500 4% 101400
Hard disks 10 4000 40000 4% 41600
Total Amount 143000
45) 22-8-2005 Partners paid Rs. 2000 in cash towards electricity charges for the
month of July 2005.
46) 26-8-2005 Partners issued a cheque for Rs. 198000 to X-Vault Computers for the
purchases made on 11-08-2005 and received a cash discount of Rs.
2200.
47) 30-8-2005 Partners received salaries for the month of August 2005 by cheque.
48) 31-8-2005 VAT adjustment entry.
Figure A.5 Detailed Trial Balance – 1st April 2005 to 31st August 2005
SEPTEMBER 2005
49) 2-9-2005 Partners paid salaries to staff for the month of August 2005 by cheque.
50) 5-9-2005 Partners withdrew Rs. 15000 from the bank for office use.
51) 10-9-2005 Partners paid telephone bill of Rs. 1200 by cheque for the month of
August 2005.
52) 14-9-2005 Partners sold the following items to Ganesh Technologies on credit
period of 15 days.
Item Quantity Rate Value VAT Total
Rate
Monitor 10 12500 125000 4% 130000
UPS 15 2000 30000 4% 31200
Total Amount 161200
53) 28-9-2005 Partners received a cheque of Rs. 161200 from Ganesh Technologies
for the sales made on 14-9-2005.
54) 29-9-2005 Partners received salaries for the month of September 2005 by
cheque.
55) 30-9-2005 VAT adjustment entry.
Figure A.6 Detailed Trial Balance – 1st April 2005 to 30th September 2005
OCTOBER 2005
56) 2-10-2005 Partners paid salaries to staff for the month of September 2005 by
cheque.
57) 5-10-2005 Partners paid telephone bill of Rs. 1250 in cash for the month of
September 2005.
58) 10-10-2005 Partners paid electricity bill of Rs. 1100 in cash for the month of August
and September.
59) 12-10-2005 Partners received a cheque from Tech Savvy Technologies in settle-
ment of bill dated 12-8-2005.
Note: Interest received Rs. 1215 for late payment.
Set Yes to “Use Debit -Credit notes” in the F11 features.
Then alter the debit note by defining voucher class ‘simple interest’
record entry in debit note with voucher class ‘simple interest’. Finally
pass separate entry for receipt.
60) 20-10-2005 Partners purchased the following items from Omega Infotech in an
offer sale 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 within 10 days. 4% VAT is applicable on all
the items.
Items Pur- Free Total Rate Value Total
chased of Qty
Qty Cost
Processors 25 5 30 5200 130000 135200
Hard Disks 20 4 24 3000 60000 62400
Printers 20 4 24 5100 102000 106080
Monitor 20 4 24 10500 210000 218400
UPS 20 4 24 1700 34000 35360
Total Amount 557440
61) 25-10-2005 Partners introduced the offer sale and sold the following items on
credit. 4% VAT is applicable on all the items.
PARAMOUNT SERVICES AND PERIPHERALS
Items Pur- Free Total Rate Value Total
chased of Qty
Qty Cost
Processors 25 5 30 6800 170000 176800
Hard Disks 20 4 24 3500 70000 72800
Total Amount 249600
I-TECH PERIPHERALS
Printers 20 4 24 6000 120000 124800
Monitors 20 4 24 1100 220000 228800
0
UPS 20 4 24 2300 46000 47840
Total Amount 401440
62) 27-10-2005 Partners received the cheques in full settlement from I-Tech Peripher-
als and Paramount Services and Peripherals for the bill dated 25-10-
2005.
63) 28-10-2005 Partners issued a cheque of Rs. 557440 for the purchases made on
20-10-2005 to Omega InfoTech.
64) 30-10-2005 Partners received salaries for the month of October 2005 by cheque.
65) 31-10-2005 VAT adjustment entry.
Figure A.7 Detailed Trail Balance – 1st April 2005 to 31st October 2005
NOVEMBER 2005
66) 2-11-2005 Partners paid salaries to staff for the month of October 2005 by
cheque.
67) 5-11-2005 Partners paid telephone bill of Rs. 1300 by cheque for the month of
October 2005.
68) 10-11-2005 Partners paid electricity bill of Rs. 1500 in cash for the month of
October 2005.
69) 15-11-2005 Partners purchased the following items from Bonafide Peripherals and
Systems on credit period of 10 days.
Note: Set ‘No’ to “Use different actual & billed Quantity” in F11
features.
Item Quantity Rate Value VAT Total
Rate
Processors 30 5000 150000 4% 156000
Printers 20 5200 104000 4% 108160
Hard disks 10 3000 30000 4% 31200
Total Amount 295360
70) 20-11-2005 Partners sold the following items to Ganesh Technologies and drew a
bill of exchange on them for 15 days which was duly accepted by
them.
Item Quantity Rate Value VAT Total
Rate
Processors 26 6000 156000 4% 162240
Printers 28 6500 182000 4% 189280
Monitors 15 11500 172500 4% 179400
UPS 15 2000 30000 4% 31200
Total Amount 562120
71) 22-11-2005 Partners settled the bills of Estrada Tech towards dated 4-7-2005,
including payment of interest Rs. 3633 on delayed payment.
Note: Make an entry in a credit note using voucher class ‘simple
interest’. Then make a payment entry.
72) 29-11-2005 Partners received salaries for the month of November 2005 by
cheque.
73) 30-11-2005 VAT adjustment entry.
74) 30-11-2005 Provision entry to transfer balance from VAT adjustment account to
VAT Payable account.
Figure A.8 Detailed Trial Balance – 1st April 2005 to 30th November 2005
DECEMBER 2005
75) 2-12-2005 Partners paid salaries to staff for the month of November 2005 by
cheque.
76) 3-12-2005 Partners paid the VAT payable for the month of November by cheque.
77) 4-12-2005 Partners paid telephone bill of Rs. 2500 in cash for the month of
November 2005.
78) 5-12-2005 Partners paid electricity charges for the month of November 2005 Rs.
1500 in cash.
79) 6-12-2005 Ganesh Technologies honoured the bill of exchange drawn on
20-11-2005 by issuing a cheque.
80) 15-12-2005 Partners purchased the following items from Swift Computers on credit
of 30 days.
Item Quantity Rate Value CST @ Total
4%
Processors 15 5000 75000 4% 78000
Monitors 10 10100 101000 4% 105040
UPS 20 1600 32000 4% 33280
Total Amount 216320
81) 29-12-2005 Partners received salaries for the month of December 2005 by
cheque.
82) 30-12-2005 Bank charged the charges for the period of 6 months amounting to
Rs. 400.
83) 31-12-2005 VAT adjustment entry.
Figure A.9 Detailed Trail Balance – 1st April 2005 to 31st December 2005
JANUARY 2005
84) 2-1-2006 Partners paid salaries to staff for the month of December 2005 by
cheque.
85) 5-1-2006 Partners paid electricity bill of Rs. 1200 in cash for the month of
December 2005.
86) 6-1-2006 Partners paid telephone bill of Rs. 1500 by cheque for the month of
December 2005.
87) 14-1-2006 Partners returned one Processor and one Monitor to Swift Computers,
purchased on 15-12-2005 as they were not according to the specifica-
tions.
Note: Set yes to ‘use Invoice mode for debit notes’ in F11 features.
Use debit note in invoice mode to pass this entry.
88) 26-1-2006 Partners withdrew Rs. 5000 by cheque for office use.
89) 30-1-2006 Partner received salaries for the month of January 2006 by cheque.
90) 31-1-2006 VAT adjustment entry.
Figure A.10 Detailed Trail Balance – 1st April 2005 to 31st January 2006
FEBRUARY 2005
91) 2-2-2006 Partners paid salaries to staff for the month of January 2006 by
cheque.
92) 5-2-2006 Partners Paid electricity bill of Rs. 1500 in cash for the month of
January 2006.
93) 6-2-2006 Partners paid telephone bill of Rs. 1100 by cheque for the month of
January 2006.
94) 9-2-2006 Partners decided to have the price list for customers, levels were
based on quantity purchased.
WHOLESALE PRICE
Items 0-10 Dis- 10-30 Dis- 30- Dis-
count count above count
Hard disks 3500 Nil 3500 5% 3500 10%
Monitors 10500 2% 10500 5% 10500 7%
Processors 6500 2% 6500 5% 6500 10%
UPS 2600 2% 2600 5% 2600 8%
RETAIL PRICE
Items 0-5 5-15 15-30 30-above
Hard disks 3450 3400 3350 3300
Monitors 10400 10300 10250 10200
Printers 5200 5100 — —
Processors 6400 6300 6200 6100
UPS 2550 2500 2450 2400
95) 10-2-2006 Partners sold the following items to E-Comp Systems on credit of 30
days. CST @ 4% for all the items.
Note: Whole sale price list
Item Qty Rate Discount Value Total
Processors 18 6500 5% 111150 115596
Hard disks 15 3500 5% 49875 51870
Monitors 8 10500 2% 82320 85613
UPS 10 2600 5% 24700 25688
Total Amount 163171
96) 27-2-2006 Partners received salaries for the month of February 2006 by cheque.
97) 28-2-2006 VAT adjustment entry.
98) 28-2-2006 Provision entry to transfer balance from VAT adjustment account to
VAT Payable account.
Figure A.11 Detailed Trial Balance – 1st April 2005 to 28th February 2006
MARCH 2006
99) 2-3-2006 Partners paid salaries to staff for the month of February 2006 by
cheque.
100) 3-3-2006 Partners paid telephone bill of Rs. 2500 by cheque for the month of
February 2006.
101) 4-3-2006 Partners paid VAT payable for the month of Febraury 2006 by cheque.
102) 5-3-2006 Partners paid electricity charges for the month of February 2006
Rs.1800 in cash.
103) 6-3-2006 Partners paid Rs. 5000 by cheque as incentive to employees.
104) 10-3-2006 Partners sold the following items to Ganesh Technologies on credit of
30 days
Note: Sold using Retail price list
Item Qty Rate Value VAT Total
Rate
Hard disks 4 3450 13800 4% 14352
Printers 4 5200 20800 4% 21632
Monitors 15 10250 153750 4% 159900
UPS 4 2550 10200 4% 10608
Total Amount 206492
105) 15-3-2005 Ganesh technologies returned one Hard disk and one Monitor as they
were not according to the specification out of sales made on 10-3-
2005.
106) 29-3-2006 Partners received salaries for the month of March 2006 by cheque.
107) 30-3-2006 Partners paid Parmeet Kaur a part of loan taken on 1-7-2005 Rs.
250000 as principle and Rs. 15000 interest for period ending 31-03-
2006 by cheque.
108) 31-3-2006 Partners paid unsecured Loan to ‘Serve Well Technologies’ amounting
to Rs. 50000 by cheque. Amount is inclusive of interest for the year
2005-2006 Rs. 5000.
109) 31-3-2006 VAT adjustment entry.
110) 31-3-2006 Provision entry to transfer balance from VAT adjustment account to
VAT Payable account.
Provision Entries
SL. NO. TRANSACTION
1) Telephone bill paid - Rs. 950
2) Electricity charges paid - Rs. 700.
3) Provision for Income Tax(2005-2006) - Rs. 5000
3) Paid salaries to staff.
Interest on capital to be credited to the respective capital accounts of partners as calculated here-
under:
PARTNER’S NAME AMOUNT (A) INTEREST (B) INTEREST AMOUNT
(A)*(B)-100=(C)
Jayaram Sengupta 300000 6% 300000*6/100=18000
Jayasree Gupta 300000 6% 300000*6/100=18000
Depreciation Entries
SL. NO. ASSET NAME OPENING DEPRECIATION DEPRECIATION
BALANCE (A) PERCENTAGE (B) (A)*(B)-100=(C)
1) Furniture 25000 10% 2500
2) Motor Car 100000 15% 15000
3) Office Equipments 23000 25% 5750
4) Office Building 250000 10% 25000
Total 48250
Closing Entry
SL. NO. TRANSACTION
1) Divide the profit earned and transfer it to the partners accounts. Both partners
share the profit earned equally.
Figure A.12 Detailed Trial Balance – 1st April 2005 to 31st March 2006
CAPITAL
30) Jayaram Gupta Capital A/c Capital Account
31) Jayasree Gupta Capital A/c Capital Account
REVENUE
32) Sales @ 4% Sales Accounts
33) Sales-CST Sales Accounts
34) Discount Received Indirect Incomes
35) Interest Received Indirect Incomes
EXPENSES
36) Input CST @ 4% Tax on Purchases
37) Puchases @ 4% Purchase Accounts
38) Purchases-CST Purchase Accounts
39) Carriage Inward Expenses Direct Expenses
40) Bank Charges Indirect Expenses
41) Carriage Outward Expenses Indirect Expenses
42) Depreciation Expenses Indirect Expenses
43) Electricity Expenses Indirect Expenses
44) Incentive Expenses Indirect Expenses
45) Interest Expenses Indirect Expenses
46) Interest on Partners’ Capital Indirect Expenses
47) Partners’ Remuneration Indirect Expenses
48) Provision for Income Tax (2005-06) Indirect Expenses
49) Salary Expenses (Staff) Indirect Expenses
50) Seminar Expenses Indirect Expenses
51) Telephone Expenses Indirect Expenses
8) F10 Navigate between account- At the reports screens, trial balance, account
ing reports books and day book screens.
9) F11 To select the features At almost all screens in Tally.
screen
10) F12 To select the configure At almost all screens in Tally.
screen