TALLY ERP 9 Final

APOLLO COMPUTER
Tally ERP 9.0 Text Book

Training Material
Hosur
TALLY ERP 9.0
APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109.

APOLLO COMPUTER EDUCATION TALLY TEXTBOOX
Table of Contents
BASIC OF ACCOUNTING..................................................................................................................................................5
Introduction................................................................................................................................................................5
Advantages of Accounting:-.......................................................................................................................................5
Words for Accounting:-..............................................................................................................................................6
Types of Accounts:......................................................................................................................................................7
Golden Rules of Accounting:......................................................................................................................................7
Simple & Double Entry System of Book Keeping........................................................................................................7
Introduction of Tally.ERP................................................................................................................................................8
History........................................................................................................................................................................8
Versions of Tally.........................................................................................................................................................8
Company Features...................................................................................................................................................10
F1: Accounting Features...........................................................................................................................................10
F2: Inventory Features..............................................................................................................................................12
F3: Statutory & Taxation..........................................................................................................................................13
F4: Tally.NET Features..............................................................................................................................................14
F12 Configuration Menu...............................................................................................................................................14
F12: Configurations..................................................................................................................................................14
Getting started with Tally.ERP 9 Start-up.....................................................................................................................14
Setting up of Company in Tally.ERP 9......................................................................................................................15
Ledgers/ Accounts....................................................................................................................................................17
Groups......................................................................................................................................................................17
Predefined Groups of Accounts................................................................................................................................17
Create Accounts/Ledger......................................................................................................................................17
Create Multiple Ledgers:......................................................................................................................................20
Create New Group:..............................................................................................................................................20
Accounting Vouchers....................................................................................................................................................24
Contra Voucher (F4).................................................................................................................................................24
Payment Voucher (F5)..............................................................................................................................................25
Receipt Voucher (F6)................................................................................................................................................28
Journal Voucher (F7)................................................................................................................................................29
Sales Voucher (F8)....................................................................................................................................................30
Credit Note Voucher (Ctrl + F8)................................................................................................................................30
APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

Purchase Voucher (F9).............................................................................................................................................32
Debit Note Voucher (Ctrl + F9).................................................................................................................................32
Reversing Journal Voucher (F10)..............................................................................................................................33
Memo Voucher (Ctrl + F10)......................................................................................................................................34
Optional Voucher.....................................................................................................................................................35
Post-dated Vouchers................................................................................................................................................35
Cost Centre and Cost Category.....................................................................................................................................40
Assignments..................................................................................................................................................................50
Exercise -1................................................................................................................................................................50
Exercise -2................................................................................................................................................................52
Exercise -3................................................................................................................................................................53
Exercise -4................................................................................................................................................................54
Exercise 5..................................................................................................................................................................55
Exercise 5..................................................................................................................................................................55
Inventory Masters.........................................................................................................................................................56
Stock Groups............................................................................................................................................................57
Stock Categories.......................................................................................................................................................57
Godowns / Locations................................................................................................................................................58
Units of Measure......................................................................................................................................................58
Stock Items...............................................................................................................................................................58
Bill of Materials (BOM).................................................................................................................................................61
GST................................................................................................................................................................................65
Central GST(CGST)....................................................................................................................................................65
State GST(SGST).......................................................................................................................................................65
INTEGRATED GST......................................................................................................................................................65
Advantage of GST.....................................................................................................................................................67
GST Act.....................................................................................................................................................................68
GST Rates.................................................................................................................................................................68
Why Returns?...........................................................................................................................................................68
Overview of GST Returns..........................................................................................................................................69
Monthly................................................................................................................................................................69
Quarterly..............................................................................................................................................................69
Annual..................................................................................................................................................................69
TDS –TAX DEDUCTION ON SOURCE..............................................................................................................................71

TDS on Expenses (Journal Voucher).........................................................................................................................71
Payment of Party......................................................................................................................................................71
Payment of TDS.......................................................................................................................................................72
Tax Collected at Source (TCS).......................................................................................................................................74
Value Added Tax (VAT).................................................................................................................................................76
Vat Exercises.............................................................................................................................................................77
Service Tax....................................................................................................................................................................79
To enable Service Tax:..............................................................................................................................................79
Tax Head based Tax Ledgers....................................................................................................................................80
Examples..................................................................................................................................................................81
Excise Duty or Duty on Excise.......................................................................................................................................82
Excise Registration (of Factory/Warehouse)............................................................................................................82
Excise Control Code (ECC) Number...........................................................................................................................82
MASTERS..................................................................................................................................................................82
PAYROLL........................................................................................................................................................................84
Enabling Payroll in Tally.ERP 9.................................................................................................................................84
Case Study Company................................................................................................................................................84
Step 1: Company Setup............................................................................................................................................84
Step 2: Enable Payroll...............................................................................................................................................84
Employee Setup........................................................................................................................................................86
Employee Details:.....................................................................................................................................................86
Employee Category..................................................................................................................................................86
Employee Groups.....................................................................................................................................................86
Employee Master.....................................................................................................................................................87
Payroll Masters........................................................................................................................................................88
Payroll Units.............................................................................................................................................................88
Simple Payroll Units.............................................................................................................................................88
Compound Payroll Units......................................................................................................................................89
Attendance/ Production Types.................................................................................................................................90
Present Attendance Type.....................................................................................................................................90
Absent Attendance Type......................................................................................................................................91
Overtime Production Type...................................................................................................................................91
Pay Heads.................................................................................................................................................................92
Earning Pay Heads...................................................................................................................................................92

Basic Pay Head Creation......................................................................................................................................93
House Rent Allowance Pay Head Creation..........................................................................................................94
Conveyance Pay Head Creation...........................................................................................................................95
Deduction Pay Heads...............................................................................................................................................96
i. Employee’s PF Contribution @ 12% Pay Head Creation...................................................................................96
ii. Employee’s ESI Contribution @ 1.75% Pay Head Creation..............................................................................97
Salary Details Setup..................................................................................................................................................99
In the Attendance Auto Fill screen,....................................................................................................................102
Payroll Reports.......................................................................................................................................................103
Display Pay Slip..................................................................................................................................................103
reports........................................................................................................................................................................105
Financial Statements and Reports.........................................................................................................................105

BASIC OF ACCOUNTING
Introduction
Accounting: - Accounting is a process of identifying, recording, summarizing and

reporting economic information to decision makers in the form of financial statements.
Advantages of Accounting:-
Following are the advantage by keeping accounting.
1)By keeping accounting we can understand the profit or loss in a particular time period.
2) We can understand the following financial position of business-
a) How many assets are in business.
b) How many Liabilities of business.
c) How many capitals are in business?
3)Also we can understand the reasons of profit or loss by keeping accounting.
Considering above advantages we can easily understand that accounting is the soul of
business.

Words for Accounting:-

While learning accounting we have to use some words regularly. First we understand
meaning of these words –
Goods: - Goods are regularly and mainly purchase and sales in business. Eg. In Arasu
Industries Spring, Nut, Steel etc are goods. Profits depends on purchasing and selling of
goods.
Assets: - Assets valuable things which are essential and assets for business. Eg.
Building, vehicle, machinery, furniture.
Liabilities: - Liabilities are given by business to others. Eg. Loan taken from bank,
purchasing goods on credit.
Capital: - Capital means the investment made by the owner of business. This capital is in
the form of cash, goods or assets. As this capital is invested by the owner of the business,
according to the business this capital is also consider as a liabilities.
Debtor: - Persons who are belongs to give us certain amount are called debtor.
Creditor: - Persons to whom our business has to give certain amount are called
creditors.
Business Transaction: - A financial events which are related to business and effects the
financial position of the company. Eg. Purchase goods, salary given, sale goods on
credit.
Cash Transaction: - Transaction which are done by cash, are called as cash transaction.
Credit Transaction: - Transaction which are done on credit, are called as credit
transaction.
Account: - An account is a statement of transactions affecting any particular asset,

liability, expense or income.
Ledger: - A Ledger is a book which contains all the accounts whether personal, real or
nominal, which are entered in journal or subsidiary books.

Types of Accounts:
1) Personal Accounts:- All persons, societies, trusts, bank and companies accounts are
Personal accounts. Eg. Rahul A/c, Gayatri Sales A/c, Subodh Traders A/c, Bank of
Maharashtra A/c.
2) Real Accounts:- Real accounts contains all asstes and goods a/c. eg. Cash A/c,
Furniture a/c, Building A/c.
3) Nominal Accounts:- All incomes and expenses related to business comes under the
nominal account. E.g. Salary A/c, Rent A/c, Commission A/c, Advertisement A/c, Light
Bill A/c.
Golden Rules of Accounting:
While making a transaction entry, we have to decide the Debit or Credit side. For that
following are the rule –
Real Accounts Personal Accounts Nominal Accounts
Debit What Comes in The Receiver Expenses and Losses
Credit What Goes out The Giver Incomes and Gains
Simple & Double Entry System of Book Keeping
Each transaction makes two effects on business.
For example,
a) Goods purchased for cash – In this transaction goods are coming in business but
at the same time amount is going from business.
b) Goods sold to Datta Traders on credit – In these transaction goods are selling
and at the same time Datta Traders becomes debtors of our business.
As per Double Entry System of book-keeping, all these business transactions recorded in
accounts have two aspects - Debit aspect (receiving) and Credit aspect (giving).

Introduction of Tally.ERP
Tally Solutions Pvt. Ltd., is an Indian multinational company that provides enterprise resource planning software. It
is headquartered in Bangalore, Karnataka India. The company reports that its software is used by more than 1
Million customers.
History
History. Tally Solutions, then known as Peutronics, was co-founded in 1986 by Shyam Sunder Goenka and his son
Bharat Goenka.
Shyam Sundar Goenka was running a company that supplied raw materials and machine parts to plants and textile
mills in southern and eastern India.
Products:
1. Tally.ERP9,
2. Tally.Server9,
3. Tally.Developer
4. Founder: Shyam Sunder Goenka and Bharat Goenka
5. Industry: ERP Software Founded: 1986
Versions of Tally
Tally 3.0:
This version only ran on Microsoft DOS and was unable to run in Windows OS.
Tally 4:
DOS based accounting as it could not be run on windows operating system
Tally 4.5:
It offered simple financial reports and scrutiny of debtors and creditors in the business.

Tally 5:
This version comprised of inventory modules which involved detailed inventory, structure invoicing and integrating
accounting and inventory records.
Tally 5.4:
It had the capacity of importing of data facility with the help of which it was able to convert earlier data formats
into the current data format.
Tally 6.3:
it interacted with other system through Open Data Base Connectivity.
Tally 7.2:
It’s an integrated enterprise system which provides various types of taxes such as TDS, VAT & TCS along with
Service Tax modules.
Tally 8.1:
Released in 2006, this version is a software that supports multi languages. It supports 10 languages.
Tally 9:
It supports 13 languages, including foreign ones and also includes Payroll, POS (Point of Sales).
Tally ERP 9:
This version offers different features such as remote access, much commanding data security, tally.net and several
more.

Company Features
In Tally.ERP 9, you can enable and use the available features as required for your company.
F11: Features , when enabled or disabled, will apply to the current company only.
To enable company features
1. Go to Gateway of Tally > click F11: Features .
2. Select the required features in the Company Features menu.
3. Enable the required features.
4. Press Ctrl+A to accept.
F1: Accounting Features

The Accounting Features consists of configurations/ functionality, which generally affects
accounting transactions and reports. The accounting features are further sub-divided into six
sections, namely:
 General
 Outstanding Management
 Cost/ Profit Centre Management
 Invoicing
 Budgets/ Scenario Management
 Other Features
Go to Gateway of Tally > F11: Features > Accounting Features or click on F1: Accounts
The F1: Accounting Features screen is displayed as shown:


F2: Inventory Features

 General
 Storage & Classification
 Order Processing
 Invoicing
 Purchase Management
 Sales Management
 Other Features
Go to Gateway of Tally > F11: Features > Inventory Features or click on F2: Inventory
The F2: Inventory Features screen is displayed as shown:
Enable the required features and press Enter to accept

F3: Statutory & Taxation

The Statutory features are country specific and strictly depends upon the Country selected in the
Company Creation screen. The following features are available, when India is selected in the
Statutory Compliance for field in the Company Creation screen.
 GST
 Value Added Tax
 Service Tax
 Tax Deducted at Source
 Tax Collected at Source
 Payroll
 Income Tax
Go to Gateway of Tally > F11: Features > Statutory & Taxation or click on F3: Statutory
The F3: Statutory & Taxation screen is displayed as shown:
 E
nable the required features and press Enter to accept

F4: Tally.NET Features
The Tally.NET Features screen comprises of Connection Details, Remote Access and SMS Access
details of a company for connecting on Tally.NET.
F12 Configuration Menu
F12: Configurations
In Tally.ERP 9, the F12: Configuration options are provided for Accounting, Inventory, Payroll,
E-mailing, Data, Printing options, TDL etc..
Go to Gateway of Tally > press F12: Configure
The Configuration screen is displayed as shown:
Getting started with Tally.ERP 9 Start-up

o Click on Start > Programs > Tally.ERP 9 > Tally.ERP 9 icon or
o Double-click on the Tally.ERP 9 on the desktop

o
Setting up of Company in Tally.ERP 9

The first step towards understanding Tally.ERP 9 is to create a company in Tally.ERP 9.
Create a Company
Go to Gateway of Tally > Company Info. > Create Company
Create a company Athithi Trader with the details as shown in the screen:

o Press Y or Enter to accept the screen
Once the Company creation screen is accepted, the Gateway of Tally Screen loads.
Select a Company
To Select a Company,
Go to Gateway of Tally > press Alt+F3 (Company Info.) > Select Company
Alter a Company
To Alter a Company,
Go to Gateway of Tally > press Alt+F3 (Company Info.) > Alter
Shut a Company
To Shut a Company,
Go to the Gateway of Tally > press Alt+F3 (Company Info.) > Shut Company


Ledger and Groups

Ledgers/ Accounts
Before making Journal Entries we have to create ledgers. Ledges are one type of account
with the help of which we make Voucher entries. E.g. Sahayog Traders a/c, Bank A/c etc.
Groups
Groups are the collection of similar nature’s ledger. We create groups to see company
effect of similar ledgers. E.g. we take all sales ledger under Sales account group.
Predefined Groups of Accounts
In Tally.ERP 9 there are already 28 predefined Groups are there. Out of which 15 are
main or primary groups and 13 sub-groups.
Create Accounts/Ledger
To create ledger:-
Gateway of TallyAccounts InfoLedger Create

Name: Enter here the party’s/ Ledgers name.
Alias: If you want to give alias name
Under: Here select the group below which this ledger comes.
Inventory Values are Affected: If you are going to maintain Inventory and this ledger
transaction affects inventory values, then select Yes here.
Address: Enter address of the
party. State: Select State from the
list.
Pin Code: Enter the pin code.
Opening balance: Enter opening balance if any.

THE LIST OF ACCOUNT GROUPS
No. Group Name Accounts
1 Bank Accounts For Saving & Current Accounts

(Do not take banks from
which we take loan)
2 Bank OCC(Overdraft Accounts of Bank Overdraft in any
&Cash Credit) & Bank
OD A/c
3 Branch/Division Accounts of any branch or division of business
4 Capital Account Accounts for Capital
5 Cash-in-Hand For Cash A/c, Petty Cash

Owner
Purchase manager
Sales manager
Service manager
6 Current Assets For Assets A/c which are of Short Period or regularly
fluctuating value like Bills Receivable,
Tradable items and services
7 Current Liabilities Liabilities which are of short period likes Bills Payable.
Supplier and payable
8 Deposit Assets For Fixed Deposit in Bank or any Bonds
Office advance
Vehicle rent deposit
Phone deposit
Go down deposit
9 Direct Expenses & Expenses which effects directly on Production or Gross

Expenses ( Direct ) Profit like Factory Rent, Wages etc.
10 Direct Incomes & Income Incomes which affects directly on Production or on
(Direct ) Gross Profit.
11 Duties & Taxes For A/c like VAT, Excise duty, Sales Tax, Income Tax
come under this group.
12 Expenses Indirect & Expenses under administration come under this group
Indirect (Expenses ) like Advertisement, Salaries etc.
13 Income Indirect & Incomes like Commission received, Rent
Indirect (Income ) received.
14 Fixed Assets For the assets which are of long period come under this
group like Machinery, Building etc.
15 Investment For investment in Shares, Bonds, Long term Bank
Deposit etc.
16 Loans (Liability ) For the long term loan taken form others.

17 Misc. Expenses (Assets) For the Assets which are before start company.
18 Provision For the Provision of Future expenses like Income Tax,
Depreciation.
19 Purchase A/c For the accounts of Purchase & Purchase return.
20 Sales A/c For the accounts of Sales & Sales Return.
21 Reserves & Surplus / For the accounts of Reserves like General Reserve.
Retained Earning
22 Stock - in - hand For Closing Stock
23 Sundry Creditor From whom purchased goods on Credit
24 Sundry Debtor To whom sold goods on Credit.
25 Suspense A/c For the Accounts whous group we can't decied
26 Secured Loans For long term and short term loan which is taken against
security of some assets
27 Unsecured Loans For loans obtained without any security.
In the Ledges screen following option are available –
Display – It displays the list of created ledgers.
Alter – You can make change in ledger from here.
Delete ledger – You can delete ledger by pressing Alt+D in the Alter screen.
Create Multiple Ledgers:
If you want to create multiple ladgers within single group quickly then select this option.
Under group: Select the group from the list under which you want to create ladgers.
Create New Group:

Group: Group is the collection of Ledgers which are same in nature.
If you want to create new group other than tally already created, then go by following
steps -
Getway of Tally ----Account Info.----- Groups------Single Group-----------Create

Fill the following information here:
1) Name: Enter here name of the group to be created.

2) Alias: If you want to refer this group by other name, then enter the different name.
3) Under: Select the parent group from predefined Tally group, under which this group
is to be comes.
4) Group behaves like a Sub-Ledger: If you set it to Yes, then this group behaves like
control account for Ledgers under this group. Means only the group balance will be
displayed, not the Ledger wise.
5) Nett Debit/Credit Balances for Reporting: If you set it to Yes, then in the Trial
Balance net amount of this group will be displayed instead of separate debit and
credit balance.
6) Used for calculation: If you want to apply duties and taxes while accounting in this
group, then set it to Yes.
Alter Group:
After creating you can alter group by selecting Alter option which is under Single and
Multiple Groups.
Delete Group:
You can delete the group in the Group Alter window. Press Alt + D. But before you
delete the
group, you have
to delete the
Ledgers under
this group.

SAMPLE LEDGERS LIST:
S.No Ledger Name Under : Group

1 Arasu Capital A/c Capital A/c
2 Arasu Drawing A/c Capital A/c
3 Supplier Name Sundry Creditor
4 Customer Name Sundry Debtor
5 Cash A/c Cash in Hand
6 Petty Cash A/c Cash in Hand
7 Furniture A/c Fixed Asset
8 Computer A/c Fixed Asset
9 Building A/c Fixed Asset
10 Purchase A/c Purchase A/c
11 Cash Purchase A/c Purchase A/c
12 Credit Purchase A/c Purchase A/c
13 Purchase-Soap A/c Purchase A/c
14 Purchase Return /c Purchase A/c
15 Sales A/c Sales A/c
16 Cash Sales A/c Sales A/c
17 Credit Sales A/c Sales A/c
18 Sales Soap A/c Sales A/c
19 Sales Return A/c Sales A/c
20 Trade Discount on Purchase Purchase A/c
21 Trade Discount on Sales Sales A/c
22 Cash Discount Received Indirect Income
23 Cash Discount to Customer Indirect Expenses
24 Telephone Expenses Indirect Expenses
25 Salary A/c Indirect Expenses
26 Wages A/c Direct Expenses
27 Fuel Expenses A/c Direct Expenses
28 Power Expenses A/c Direct Expenses
29 Overhead Expenses A/c Direct Expenses
30 Fees Received Direct Incomes
31 Interest Received Indirect Incomes
32 Share Capital A/C Capital A/c
33 Equity Capital A/c Capital A/c
34 Partners’ Capital A/c Capital A/c
35 General Reserve A/c Reserves & Surplus
36 Capital Reserve A/c Reserves & Surplus
37 Investment Allowance Reserve A/c Reserves & Surplus
38 Share Premium A/c Reserves & Surplus
39 Indian Bank A/c Bank OD A/c
40 SBI Bank A/c Bank A/c
41 Debenture A/c Secured Loans A/c
42 Loan From Bank Secured Loans A/c

43 Loan From Outside Party UnSecured Loans A/c
44 Loan From Aravind(Friend) UnSecured Loans A/c
45 Sales Tax Duties & Taxes A/c
46 Output GST 5% Duties & Taxes A/c
48 Input GST 12% Duties & Taxes A/c
49 TDS on Rent Duties & Taxes A/c
51 All Tax A/c Duties & Taxes A/c
52 Provision for Bad Debts Provisions
53 Salary Payable A/c Provisions
54 Rent Payable a/c Current Liabilities
55 Liability of Expenses Current Liabilities
56 Investment in Share Investments
57 Stock in Hand Stock in Hand
58 Stock of Raw Materials Stock in Hand
59 Fixed Deposits Deposits(Asset)
60 Security Deposit A/c Deposits(Asset)
61 Telephone Deposit A/c Deposits(Asset)
62 Deposit in Other Company Deposits(Asset)
63 Loans to Employees Loans and Advances(Assets)
64 Kovai Branch A/c Branch/Divisions
65 Preliminary Expenses A/c Misc. Expenses(Asset)
66 Professional Fees Sales A/c
67 Commission Received Direct Income
68 Delivery Charges(In Purchase Bill) Purchase A/c
69 Depreciation A/c Indirect Expenses
70 Carriage Inwards Direct Expenses
71 Carriage Outwards Indirect Expenses
72 Freight Charges Direct Expenses

Accounting Vouchers
The standard Accounting Vouchers are:
o Contra Voucher (F4)

o Payment Voucher (F5)
o Receipt Voucher (F6)
o Journal Voucher (F7)
o Sales Voucher /Invoice (F8)
o Credit Note Voucher (CTRL+ F8)
o Purchase Voucher (F9)
o Debit Note Voucher (CTRL+ F9)
o Reversing Journals (F10)
o Memo voucher (CTRL+ F10)
You can alter these vouchers to suit your company, and also create new ones. Read ahead to understand the
function of each voucher type. The following exercises are sample enteries for understanding Voucher entry in
Tally.ERP 9, do not make these entries.
Contra Voucher (F4)

For example: withdrawing money from the bank for petty cash.
Contra Voucher
Description Record Funds transfer between cash and Bank Account
Account Amount Amount
Indian overseas bank Credit
Voucher Entry (Bank Account)
Cash Debit
(Cash-in-hand)
Use a Contra Voucher to record the entry.
Setup :
In Voucher entry mode, press F12: Contra Configuration and set the following to Yes:
o Skip the Date field in Create Mode (faster entry!)

o Use Cr/Dr instead of To/By during entry
o Warn on Negative Cash Balance
o Show Ledger Current Balances
o Show Balances as on Voucher Date

Go to the Gateway of Tally > Accounting Vouchers > F4: Contra.
Press Y or Enter to accept the screen.
Payment Voucher (F5)
For example, a company settles a creditor's bill by cheque.
Payment Voucher
Description Records all bank and cash payments

Paid Kaltronic Ltd Debit
Voucher Entry (sundry Creditors)
Bank or Cash Credit
(India overseas bank or
Cash-in-hand)
Use a Payment Voucher to record the entry.
Go to the Gateway of Tally > Accounting Vouchers > F5: Payment.
Payment in Single Entry Mode
In Voucher entry mode, use F12: Payment Configuration and set Use Single Entry mode for
Pymt/Rcpt/Contra to Yes.
Payment Voucher
Description Records all bank and cash payments
Ledger account paid Debit

Conveyance Postage
Voucher Entry (Indirect Expenses)
Bank or Cash Credit
(India overseas bank or
Cash-in-hand)
Entry made in the single entry mode appears as shown below:
The advantage of a single entry mode is that you can select multiple debits or credits depending on the type of
entry. Similarly the transactions can be recorded in single entry mode even in Receipt and Contra vouchers.
Warn on Negative Cash Balance
Warning if the cash balance is NIL when Warn on Negative Cash Balance is set to Yes in the F12: Payment
Configuration. For example, a cash ledger account has no balance. A payment of Rs. 4,500 towards Telephone
expenses is to be made. In the process of making the payment, Tally.ERP 9 displays a warning at the time of
accepting the entry.

In addition to the warning, Tally.ERP 9 also displays the negative balance amount in Red.
Receipt Voucher (F6)
For example, the company receives a bank advice that the interest has been credited to its deposit account.
Receipt Voucher
Description Records all receipts into bank or cash accounts
Ledger account receiving Credit
Voucher Entry Bank Interest
(Indirect Incomes)
Bank or cash account Debit
Deposit Account
Use a Receipt Voucher to record the entry.
Ensure in F12: Payment Configuration, Use Single Entry mode for Pymt/Rcpt/Contra is set to No.
Go to the Gateway of Tally > Accounting Vouchers > F6: Receipt.
The entry made appears as shown below:


Journal Voucher (F7)
For example, the company has entered some expenditure on advertising as general office costs, rather than
recording the transaction in the separate ledger for advertising.
Journal Voucher
Description Records adjustments between ledger accounts
Advertising
Debit
Voucher Entry (Indirect Expenses)
Office Costs Credit
(Indirect Expenses)
Use the Journal Voucher to adjust the two accounts.
Go to the Gateway of Tally > Accounting Vouchers > F7: Journal.

Sales Voucher (F8)
For example, a company sells software on credit.
Sales Voucher
Description Records all sales
Buyer’s ledger account
Voucher Entry Milton & Co. Debit
(Sundry Debtors)
Sales Accounts
Credit
(Local Sales)
Use a Sales Voucher for making this entry.
Go to the Gateway of Tally > Accounting Vouchers > F8: Sales.

Credit Note Voucher (Ctrl + F8)

This voucher type is made available when the option Use Debit/Credit Note to is set to Yes in the F11: Features
(F1: Accounting features).
For example: A customer returns stock that was incorrectly supplied.
Credit Note Voucher
Description Records credit note entry for sales returns or Customer over-
charging
Buyer’s ledger account Credit
Voucher Entry Milton & Co
(Sundry Debtors)
Sales Accounts Debit
(Local Sales)
Use a Credit note to record this entry.
Go to the Gateway of Tally > Accounting Vouchers > F8: Credit Note.

Purchase Voucher (F9)

A company buys computer parts on credit.
Purchase Voucher
Description Records all purchases
Supplier’s ledger account Credit
Voucher Entry Beltron Ltd
(Sundry Creditor)
Purchase Accounts Debit
(Local Purchases)
Use a Purchase Voucher to record this entry.
Go to the Gateway of Tally > Accounting Vouchers > F9: Purchase.
Debit Note Voucher (Ctrl + F9)

This voucher type is made available when the option Use Debit/Credit Notes is set to Yes in the F11: Features
(F1: Accounting Features).

Debit Note Voucher
Description Records debit note entry for purchase returns or over-charging
by a supplier
Supplier’s ledger account

Debit
Voucher Entry Beltron Ltd (Sundry Creditor)
Purchase Accounts Credit
(Local Purchases)
For example, a company returns damaged goods to a supplier.
Use a Debit Note to record this entry.
Go to the Gateway of Tally > Accounting Vouchers > F9: Debit Note.

Reversing Journal Voucher (F10)
Reversing Journals are special journals that are automatically reversed after the date of the journal. They exist
only for a day and are effective on the date of the reversing journal. This voucher type is available only if the
feature Use Reversing Journals & Optional Vouchers is set to Yes in the F11: Features (F1: Accounting
Features).
The entry made for this, is as follows:
Reversing Journal Voucher
Description Records the voucher entries in a Reversing Journal Register, without affecting the
ledger accounts and financial statements
Ledger account Debit
Voucher Entry
Ledger account Credit
Go to the Gateway of Tally > Accounting Vouchers > F10: Reversing Journal..
Memo Voucher (Ctrl + F10)
Memo Voucher is a non- accounting voucher and the entries made using it will not affect your accounts. In other
words, Tally.ERP 9 does not post these entries to ledgers but stores them in a separate Memo Register. You can
alter and convert a Memo voucher into a regular voucher when you decide to bring the entry into your books.

Memo vouchers are used for the following purposes :
1. Making suspense payments
For example, the company gives an employee cash to buy office supplies, the exact nature and cost of which are
unknown. You could have entered a voucher stating petty cash advance, a voucher to record the actual
expenditure details when they are known, and another voucher to record the return of surplus cash. However, a
simpler way is to enter a Memo voucher when the cash is advanced, and then turn it into a Payment voucher for
the actual amount spent, when known.
2. Vouchers not verified at the time of entry
Sometimes it so happens that you do not understand the details of a voucher you are entering. In such cases,
enter it as a Memo voucher and amend it when you get the details.
3. Items given on approval
Usually, entries are made into the books only after a sales transaction is completed. Items given on approval,
can be tracked by using a Memo voucher. It can either be converted into a proper Sales voucher or be deleted
depending on the outcome.e

Memo Voucher
Description Records the voucher entries in a memo register, without affecting the ledger
accounts and financial statements
Voucher Entry
Optional Voucher
This is another non-accounting voucher which is available only if the feature Use Reversing Journals &
Optional Vouchers is set to Yes in the F11: Features (F1: Accounting Features). It differs from the Memo
voucher in two respects:
o It is not a voucher type, since all the other voucher types can be marked as Optional during a
voucher entry.
o You have the option to bring this voucher into your accounts temporarily and see its effect on
financial reports. Any voucher type (except non-accounting voucher) can be designated as an
Optional voucher.
Optional Voucher
Description Records voucher entries temporarily, to help visualize the effect
on reports, without affecting the ledgers
Voucher Entry
Post-dated Vouchers
Post-dated Vouchers are ignored by Tally.ERP 9 until the date in question. This is useful for entering
transactions that take place on a regular basis. For example, if you pay for something by instalments, you can
set-up the payments in advance, and Tally.ERP 9 will only enter them in the ledgers as and when they fall due. A
voucher is marked as Post-dated while creating or altering it.

Creating a New Voucher Type
Athithi Traders wants to record bank and petty cash payments differently and needs two new voucher types to
replace the pre-defined Payment voucher. Inorder to do this:
Create a Bank Payment voucher
Go to the Gateway of Tally > Accounts Info. > Voucher Types > Create.
1. Name: Bank Payment

2. Type of Voucher: Payment (Specify the default Tally.ERP 9 voucher, whose functions the new voucher
should copy).
3. Abbr.: Bank Pymt (Specify the abbreviation to denote this new voucher in reports)
4. Method of Voucher Numbering: Automatic
You can choose one of the following methods for numbering from the pop-up:
Method of Numbering Purpose
Automatic For Tally.ERP 9 to do it for you.
You do it. You can also specify if you wish to prevent

Manual duplicates.
None To disable numbering for this voucher type.
5. Use Advance Configuration: No

6. Use EFFECTIVE Dates for Vouchers: No
7. Make ‘Optional’ as default: No (This is to set the voucher type as an Optional voucher, by default)
8. Use Common Narration: Yes
9. Narrations for each entry: No
10. Print after saving Voucher: No
11. Name of Class: Skip.
A Bank Payment Voucher Type Creation screen appears as shown below

Voucher Type Creation Screen — Bank Payment
12. Press Y or Enter to accept the screen.
Displaying and Altering a Voucher Type
Observe the menu, you will notice that you can also display and alter voucher types. Selecting these options
brings up a List of Voucher Types, from which you can select the one you want to view or work on. Apart from
the heading, the Voucher Type Display/Alter screens are identical to the Creation screen.
Practice Exercise
Create a Petty Cash Payment Voucher Type
Ensure that the details in the Voucher Type Creation screen are as shown below:
Voucher Type Creation — Petty Cash
Recording Accounting Transactions
Let us record the following business transactions of Athithi Traders for the month of September 2018 :
Athithi Trader Business Transaction
Date Transaction Details
1-9-2018 Paid Rs 500 to Challenger Systems by cheque
1-9-2018 Bought office supplies for Rs 150 with Petty Cash

2-9-2018 Wages of Rs 600 paid to employees by cheque
5-9-2018 Banked a cheque for Rs 5000 received from Data Link Technologies
6-9-2018 Sold 1 IBM Pentium IV to Spectrum Computers for Rs 24,785.
6-9-2018 Withdraw Rs 200 from Bank Account for Petty Cash
7-9-2018 Bought 1 Laserjet 1500 from Silver Plus computers on credit for Rs 8,100
The basic steps to be followed while entering each voucher are:
o Check if the date is correct and use F2: Date to change it if necessary.
o Select the voucher type from the button bar and make a further selection from the supplementary
list that Tally.ERP 9 displays, if necessary.
o Enter the appropriate reference for the Purchase and Sales vouchers.
o Select the ledgers and enter the amounts.
o Type the narration and check whether all the data is correct before accepting.
Create the following Accounting Vouchers in the books of Athithi Traders :
Date Voucher Type Ledgers to be Selected Debit Credit
1-9-2018 F5:Payment Dr - Challenger Systems 500.00
Bank Payment Cr - Bank Account 500.00
1-9-2018 F5:Payment Dr - Office Costs 150.00
Petty Cash Cr - Petty Cash 150.00
2-9-2018 F5:Payment Dr – Wages 600.00
Bank Payment Cr - Bank Account 600.00
5-9-2018 F6: Receipt Cr - Data Link Technologies 5000.00
Dr - Bank Account 5000.00
6-9-2018 F8: Sales Dr - Spectrum Computers

24,785.00
Cr - Computer Sales 24,785.00
6-9-2018 F4: Contra Cr - Bank Account

200.00
Dr - Petty Cash 200.00
7-9-2018 F9:Purchase Cr - Silverplus Computers

8,100.00
Dr - Printer Purchases 8,100.00

Trial Balance for September 2018
Go to the Gateway of Tally > Display > Trial Balance.
After making the above entries, the Trial Balance of Athithi Traders will appear as shown :
Enter further transactions for Athithi Traders.
Business Transactions for the months of May and June 2018 are as follows:
Athithi Trader Business Transaction
Date Transaction Details
1-5-2018 Bank Advice received for bank interest of Rs.500 credited to the deposit account.
11-5-18 Electricity bill (Office costs) for Rs.400 received from Horizon Enterprises.
Sold 1 HP Laserjet 1010 Series for Rs 9,500 to a cash customer, retaining the money as Petty
13-5-18
Cash.
19-5-18 Salaries of Rs 2,500. Amount paid through Bank Account.
24-5-18 Sold 1 HCL Pentium IV for Rs. 21,500 to Supreme Computers.
30-5-18 Purchased 5 USB Pen Drives 64MB @ Rs. 1,250 each from Challenger Systems on credit.
01-6-18 Paid freight charges of Rs 200 from petty Cash
01-6-18 Paid Challenger Systems Rs. 11,500 by cheque
09-6-09 Transferred Rs 6,000 from Bank Account to Deposit Account.
15-6-18 Cheque for Rs 15,000 received from Spectrum Computers.
22-6-18 Purchased 4 IBM Pentium IVs for Rs. 17,100 each from a new supplier and paid by cheque

Trial Balance for June 2009
Go to the Gateway of Tally > Display > Trial Balance
Cost Centre and Cost Category
Enabling Cost Centre and Cost Category

 Go to Gateway of Tally > F11: Features > F1:Accounting Features
 Set ‘Maintain Cost Centre to ‘Yes’
 Set ‘More than ONE Payroll/ Cost Category’ to ‘Yes’
Creating Cost Categories

 Go to Gateway of Tally > Accounts Info. > Cost Categories > Select
‘Create’ under ‘Single Cost Centre’.
 Enter ‘Sales Project 1’ in ‘Name’ > Accept the screen
Creating Cost Centers

Each salesman is considered as a cost center, so to create these:
 Go to Gateway of Tally> Accounts Info.> Cost Centre> Select ‘Create’
under Single Cost Centre
 Select ‘Sales Project 1’ in
‘Category’
 Enter ‘Salesman 1’ in Name
and accept the screen
Allocating Expenses to Cost Centre during Transaction

To allocate expenses to each cost Centre while making payment for salesmen’s
expense (for e.g. Conveyance):
 Let’s create a ‘Conveyance’ ledger under ‘Indirect Expense’. Also note that
‘Cost Centre is enabled by default.
To pass the payment transaction:
 Go to Gateway of Tally > Accounting Vouchers > F5: Payment
 Debit the ‘Conveyance’ ledger with the required amount
 Press Enter to open ‘Cost Allocation’ screen
 Select the ‘Sales Project 1’ in ‘Cost Category’

 Complete the Payment Voucher

Pre-
Allocation of Costs
For faster entry you can pre-allocate cost Centre by defining percentage in the
Cost Centre Class. For example, if a salary of Rs.50, 000 is to be paid and
distributed as 30% to Salesman 1, 25% to Salesman 2, 25% to Salesman 3 and
20% to Salesman 4. To do this:
Go to Gateway of Tally > F11: Accounting Features
Set 'Use Pre-defined Cost Centre Allocations during Entry' to 'Yes' > Press ‘Enter’
On the ‘Auto-Cost Allocation’ screen,

Enter the ‘Class Name’ and press ‘Enter’
Select the appropriate ‘Cost Category’ and enter the required percentage

Now, let’s use the ‘Cost Centre Class’ in a transaction for paying salary to the
salesmen. To do this, let’s first create a ledger ‘Salary’ under ‘Direct Expense’
and allocate all the cost Centre (salesmen). To pass the transaction:
 Go to Gateway of Tally > Accounting Vouchers > F5: Payment
 Select ‘Salary’ in ‘Cost Centre/Classes’
 Complete the Payment Voucher
Cost Centre Reports

1. Category Summary
2. Cost Centre Break-up
3. Ledger Break-up
4. Group Break-up
For example, the ‘Cost Category Summary’ report is shown below:
To view these cost Centre reports:
 Go to Gateway of Tally > Display > Statements of Accounts > Cost Centre

Budgeting helps a company to keep a track of how much money it has, where its money is going
and allocate those funds at any point in time. A proper budgeting system enables a business to
keep a track of its expenditures and use its funds effectively. Hence, business owners can
compare revenues and expenses with ease, and more importantly, make better future
investments.
To enable Budgets
 Go to Gateway of Tally > F11: Features (Accounting Features)
 Set ‘Maintain Budgets and Controls’ to ‘Yes’

Creating Budgets
Budgets can be created for an individual ledger account, groups of ledger accounts and Cost
Centers or for all of them. For example, we can create budgets for traveling, advertisement,
operations etc.
To create Budgets:
 Go to Gateway of Tally > Accounts Info. > Budgets
 Select ‘Create’ > Press ‘Enter’
 Enter budget name in ‘Name’
 Select ‘Primary’ in ‘Under’
 Specify the ‘Period of Budget’ in ‘From:’ and ‘To:’
1) For Group Budgets:
Set ‘Yes’ under ‘Group’ in ‘Set/ Alter Budgets of’ > Press ‘Enter’.

 In ‘Group Budgets’ screen, select the required Group in ‘Account Name’

 Select the appropriate ‘Type of Budget’
 Enter budget ‘Amount’
 Accept the screen

2) For Ledger Budget
3) For Cost Centre

Set ‘Yes’ under ‘Cost Centers in ‘Set/ Alter Budgets of’ > Press ‘Enter’

In ‘Cost Centre Budget’ screen, select the required Cost Centers and enter ‘Expenses’ for each
Cost Centre ( Income and Closing Balance can also be entered if required).

Altering and Deleting Budget
 Go to Gateway of Tally > Accounts Info. > Budgets > Alter

 To delete budget, press ‘Alt+D’ on the budget alteration screen.
Displaying Budgets and Variances for Groups and Ledgers

Financial statements such as Balance Sheet, Profit & Loss Account etc. Business owners can use
this handy feature to compare budgeted figures against the actual figures.
Let’s include the created Group Budgets in Trial Balance and view the variance.
Go to Gateway of Tally > Display > Trial Balance
Press ‘Alt+B’ or click on ‘B: Budget Variance’
 On the Variance Analysis screen, select the appropriate Budgets > Press ‘Enter’.

Displaying Budgets for Cost Centre

 Go to Gateway of Tally > Display > Statements of Accounts > Cost Centres > Category
Summary
 Press ‘Alt+B’ and select the required Budget and the report will display budgets and
variance as shown below:
 Press ‘Alt+N’
 Select the required ‘Column Details’.

Assignments
Exercise -1
Date Particularly Amount (Rs)

2018 April Mohan started business with Cash 5000
1
April 2 Deposit in the Bank 500
April 3 Furniture purchased for Cash 200
April 5 Purchased goods for Cash 400
April 8 Purchased goods from M/s Ram Narain on credit 1000
April 16 Goods sold to M/s Ram & Co. for cash 600
April 24 Goods sold on credit to Ramesh 300
April 28 Received cash from Ramesh 300
April 30 Paid Rent 100
April 30 Paid Salary 200
Answer
2018 April 1 Mohan started business with Cash 5000
Cash A/c Dr. 5000
To Mohan’s Capital A/c 5000
(Being the amount invested by Mohan in the business)
April 2 Deposit in the Bank 500
Bank A/c Dr. 500
To Cash A/c 500
(Being the amount paid into the Bank)
April 3 Furniture purchased for Cash 200
Furniture A/c Dr. 200
To Cash A/c 200

(Being furniture purchased for cash)

April 5 Purchased goods for Cash 400
Purchase A/c Dr. 400
To Cash A/c 400
(Being goods purchased for cash)
April 8 Purchased goods from M/s Ram Narain on credit 1000
Purchase A/c Dr. 1000
To M/s.Ram Narain A/c 1000
(Being goods purchased from M/s.Ram Narain on credit)
April 16 Goods sold to M/s Ram & Co. for cash 600
Cash A/c Dr. 600
To Sales A/c 600
(Being goods sold for cash)
April 24 Goods sold on credit to Ramesh 300
Ramesh A/c Dr. 300
To Sales A/c 300
(Being goods sold to Ramesh on credit)
April 28 Received cash from Ramesh 300
Cash A/c Dr. 300
To Ramesh A/c 300
(Being cash received from Ramesh)
April 30 Paid Rent 100
Rent A/c Dr. 100
To Cash A/c 100
(Being the amount paid for rent)

April 30 Paid Salary 200

Cash A/c Dr. 200
To Salary A/c 200
(Being the amount paid for salary)
Exercise -2
Types of Voucher:
Contra (F4) : This type is uses only for cash and Bank accounts. Eg. When you
deposit cash in bank or withdraw cash from bank, also transfer money from one
account to another take this voucher type. But never select this type for loan taken
from Bank loan.
Eg. 1) Open Bank Account in Bank of India with Rs. 5000
2) Withdrawn from Bank of India Rs. 2000
Payment (F5) : Select this type when transaction is in cash. i.e. when in a
transaction cash paid from cash a/c or from any bank then select the voucher type
payment.
E.g. 1) Machinery Purchase for cash Rs. 20000
2) Salary Paid Rs. 3000.
Receipt (F6) : When money in the form of cash or cheque comes in a business
from any source of income then select this type of voucher.
E. g. 1) Machinery Sold for cash Rs. 10000
2) Commission Received Rs. 2000
Journal (F7) : When there is a non cash transaction or a transaction which could
not fit above types then select this type of voucher. E.g Sales and purchase on
credit, interest on loans taken or given or some accounting adjustment.
E.g. 1) Depreciation to be charged on Machinery Rs. 50000
2) Bills Receivable of Rs. 10000 from Sun Traders.
3) Bills Payable to India co. of Rs. 2500
Sales (F8) : Select this voucher type for all sales in cash and credit.
E.g. 1) Sold Goods on credit to Sun Micro system for Rs. 20000
Credit Note (Ctrl + F8) : When we receives return of goods, then there is a note
which contains details of that the goods. This is called Credit Note. Select this
voucher when there is sales return transaction.
e.g. 1) Goods Return by Sagar Traders of Rs. 2500
Purchase (F9) : All the purchases made (in cash and credit) are entered in the
Purchase Voucher.
E.g. Purchase Machinery from Sun Traders for Rs. 40,000/-.
Debit Note (Ctrl + F9) : When we return goods that we purchased, then there is a
note which contains details of that the goods. This is called Debit Note. Select this
voucher when there is purchase return transaction.

e.g. 1) Goods return to Sumit Traders of Rs. 3000

Exercise -3
Sl. Date Voucher type Particular Debit Credit Narration

No
1 01-04-18 F6 Receipts Dr. Cash A/c 1,00,000
Cr. Capital A/c 1,00,000
2 01-04-18 F7 Journal Dr. Vehicle A/c 50,000
Cr. Capital A/c 50,000
3 01-04-18 F7 Journal Dr. Furniture A/c 30,000
Cr. Capital A/c 30,000
4 10-04-18 F4 Contra Dr. Bank of India 5,000
Cr. Cash Ac 5000
5 21-04-18 F9 Purchase Dr. Purchase A/c 70,000
Cr. Cash A/c 70000
6 26-04-18 F8 Sales Dr. Cash A/c 35,000
Cr. Sales A/c 35000
7 03-05-18 F8 Sales Dr. Sujit A/c 10,000
Cr. Sales A/c 10000
8 12-05-18 F8 Sales Dr. Bank of India 8,000 Ch. No.
Cr. Sales A/c 8000 303131
9 18-05-18 F5 Payment Dr. Telephone Bill 1,000 Ch. No.
Cr. Bank of India 1000 303133
10 21-05-18 F6 Receipt Dr. Cash A/c 2,500
Cr. Commission A/c 2500
11 2-06-18 F9 Purchase Dr. Purchase A/c 10,000
Cr. Himanshu Sales 10000
12 15-06-18 Ctrl + F9 Dr. Purchase A/c 2,000
Debit Note Cr. Himanshu Sales 2000
13 17-06-18 F5 Payment Dr. Salary A/c 2,000
Cr. Cash 2000
14 20-06-18 F6 Receipt Dr. Cash A/c 20,000
Cr. Janta Bank A/c 20000
15 22-06-18 F5 Payment Dr. Advertisement A/c 5,000
Cr. Cash A/c 5000
16 06-07-18 F5 Payment Dr. Office Rent A/c 2,000 Ch. No.
Cr. Bank of India 2000 303132
17 11-07-18 F8 Sales Dr. Dhiraj A/c 6,000
Cr. Sales A/c 6000
18 13-07-18 Ctrl +F8 Dr. Sales Return A/c 1,000
Credit Note Cr. Dhiraj A/c 1000
19 18-07-18 F5 Payment Dr. Electricity Bill A/c 3,000
Cr. Cash A/c 3000
20 23-07-18 F4 Contra Dr. Cash A/c 2,000
Cr. Bank of India
2000

21 25-07-18 F7 Journal Dr. Vehicles 1,000

Depreciation A/c
Cr. Vehicles A/c 1000
22 25-07-18 F7 Journal Dr. Furniture 3,000
Depreciation A/c
Cr. Furniture A/c 3000
23 10-08-18 F5 Payment Dr. Janta Bank A/c 2,600 Being
Cr. Cash A/c 2600 Inst.Paid
24 12-08-18 F7 Journal Dr. Bills Receivable 2,200
A/c Cr. Kishor A/c 2200
25 20-08-18 F7 Journal Dr. Mandar A/c Cr. 2,000
Bills Payable 2000
Exercise -4
S.N Date Particular

o
1 1.4.2018 Started business with cash Rs. 50,000/-
Cash a/c dr
Capital a/c cr
Hint ' F6 ' Receipt
2 2.4.2018 Deposited cash in State Bank of India Rs. 15,000/
Statebank of india a/c dr
Cash a/c cr-
Hint ' F4 ' Contra
3 3.4.2018 3.4.2009 Paid Salary Rs. 5,000/- to Mrs. Asmita
Salary a/c dr
Cash a/c cr
Hint ' F5 ' Payment
4 4.4.2018 4.4.2009 Purchase Goods worth Rs. 45,000/- on credit from Swan
Enterprises
Purchase a/c dr
Cash a/c cr.
Hint ' F9 ' Purchase
5 5.4.2018 5.4.2009 Credit Sales of goods worth Rs. 75,000/- to 'Y' Company
Hint ' F8 ' Sales
Y company dr
Credit sales cr
6 6.4.2018 6.4.2009 Returned goods to 'Swan Enterprise' Rs. 5,000/-
Hint ' F9 ' Debit Note
7 7.4.2018 7.4.2009 Received goods returned by 'Y' Company.
Hint ' F8 ' Credit Note
8 8.4.2018 8.4.2009 Purchased Machinery on Credit Rs. 40,000/- from Manish
Enterprises
Hint ' F7 ' Journal
9 9.4.2018 9.4.2009 Received commission in cash Rs. 2,000/-

Hint ' F6 ' Receipt

10 10.4.201 10.4.2009Withdrawn from State Bank of India Rs. 5,000/-
8 Hint ' F4 ' Contra

Exercise 5
1) Started business with cash Rs. 20,000/-
2) Purchased goods worth Rs. 5,000/- on credit from 'X'
3) Sold goods worth Rs. 3,000/- to 'Y' on credit.
4) Opened a bank account with State Bank of India by depositing Rs. 2,000/-.
5) Paid salary Rs. 1,000/- in cash to Ramesh.
6) Received a cheque of Rs. 3,000/- from 'Y'.
7) Received commission from Ankit Rs. 2,000/-.
8) Paid Rent Rs. 500/-
9) Withdrew from bank Rs. 1,000/-
10) Issued a cheque of Rs. 4,000/- to 'X'.
Exercise 5
Voucher Entries
1/7/2018 Started business with Cash Rs. 30,000/-, building Rs. 75,000/- & Furniture Rs.
20,000/-
2/7/2018 Opened a Bank account with Indian Bank by depositing Rs. 5,000/-
5/7/2018 Paid salary to Mr. Sane Rs. 3,000/- and Mr. Shete Rs. 2,500/-
12/7/2018 Paid commission Rs. 1,500/- to Anand.
28/7/2018 Paid electricity bill of meter no 57011210 Rs. 750/- & meter no.57011220 Rs.1,250/-
31/7/2018 Received interest Rs. 350/- from Indian Bank and Rs. 250/- from Dena Bank.

Inventory Masters
Newly created company the Inventory Info. menu comprises of four types of Masters
Stock Groups, Stock Items, Units of Measure and Voucher Types.
Go to the Gateway of Tally > Inventory Info.
Inventory Masters types
Units of Measure
Example of Indus Enterprises that sells Televisions and Music Systems.

Group A – Televisions
A1 – Sony A1a – Sony 29 inches TV
A1b – Sony 25 inches TV
A2 – Philips A2a – Philips 29 inches TV
A2b – Philips 25 inches TV
A3 – Videocon A3a – Videocon 29 inches TV
A3b – Videocon 25 inches TV
Group B – Music Systems

B1 – Sony B1a – Sony Tape-Recorder
B1b – Sony CD Player
B2 – Videocon B2a – Videocon Tape-Recorder
B2b – Videocon CD Player
The televisions are sold in numbers. Hence Unit of Measure will be Nos.
Indus Enterprises has two Godowns, the Hosur Godown and the Mumbai Godown.
Stock Group
1. Televisions (main stock group)

 Sony TV – stock group under Televisions
 Philips TV – stock group under Televisions
 Videocon TV – stock group under Televisions
2. Music Systems (main stock group)
 Sony Music Systems – Stock Group under Music Systems
 Videocon Music Systems – Stock Group under Music Systems
Stock Groups
Grouping stock items makes it easy to identify and report them in the statements
Creating Stock Group
i. Create the Stock Group – Television under Primary.
Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create (under the Single Stock
Group).
ii. Create Sony TV under Televisions.
Stock Categories
Set Yes to Maintain Stock Categories in F11: Features (F2: Inventory Features) to get an
additional option Stock Categories under Inventory Info.
Creating Stock Category
Go to the Gateway of Tally > Inventory Info. > Stock Categories > Create.
i. Create Stock Category 29 inches TV Under Primary

Godowns / Locations
A place where stock items are stored is referred to as Godowns.
For example: A warehouse, shelf or rack etc,
Set Yes to Maintain Multiple Godowns in F11: Features (F2: Inventory Features)
Creating a Godown
Go to the Gateway of Tally > Inventory Info. > Godowns > Create.
i. Create a Godown – Hosur under Primary.
Units of Measure
Stock Items are mainly purchased and sold on the basis of quantity.
Creating Units of Measure
Go to the Gateway of Tally > Inventory Info. > Units of Measure > Create.
Stock Items
Stock items are goods that you manufacture or trade (sell and purchase).
Creating a Stock Item
Go to Gateway of Tally > Inventory Info. > Stock Items > Create.

Kavish Traders that sells computers, Printers and Peripherals. Create the stock groups and sub-
groups as shown:
Stock Group Under

Computers Primary
Printers Primary
Peripherals Primary
Accessories Peripherals
Components Peripherals
Create Stock Groups
i. Creating single stock groups
Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create.
Create a Stock Group – Computers
Name Under Can Quantities of items be ADDED

Peripherals Primary Yes
Printers Primary No
Creating Multiple Stock Groups
Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create.

Creating Single Stock Categories
Name Under
National Primary
Creating Multiple Stock Categories
Under Category Name of Category
Primary HCL
Primary IBM
Primary HP
Primary Samsung
Creating Units of Measure
Go to the Gateway of Tally > Inventory Info. > Units of Measure > Create
Type Symbol Formal Name Number of Decimal
Simple Nos Number of 0
Simple Box Boxes 0
Creating Compound Units of Measure
Go to the Gateway of Tally > Inventory Info. > Units of Measure > Create
Creating Godowns
Go to the Gateway of Tally > Inventory Info. > Godowns > Create.
Create Stock Items
Go to the Gateway of Tally > Inventory Info. > Stock items > Create.
Stock Cost Warehouse On Site Total Qty Total Value Retail Price
COMPUTERS
HCL PIV 17,500 1 4 5 Nos 87,500 21,500
IBM PIV 17,100 0 4 4 Nos 68,400 24,785
PERIPHERALS
Accessories
CDROM Disks 100s 450 0 5 5 Box 2,250 500
Dust Covers 35 2 8 10 Nos 350 40
USB Pen Drives 1,250 0 10 10 NOs 12,500 1,600
64MB
Wireless Keyboard 490 10 15 25 Nos 12,250 700
Wireless Mouse 250 10 10 20 Nos 5,000 430
Printers
HP Laserjet 1010 8,200 0 7 7 Nos 57,400 9,500
Series
Samsung Laserjet 8,100 0 5 5 Nos 40,500 9,850
1500
Total 2,86,150

Bill of Materials (BOM)
To set multiple bill of materials (BoM):

• Go to ‘Gateway of Tally > F12: Configure > Accts/Inventory Info’.
• Set ‘Allow Component List Details (Bill of Materials)’ to ‘Yes’.
Creating an item with multiple BoMs
In Tally.ERP 9, creating a new item requires you to go to ‘Gateway of Tally > Inventory Info. >
Stock Items > Create.

Once the ‘Name’ and ‘Unit of Measure’ are defined, select ‘Yes’ under ‘Set Components
(BoM)’, as shown below:

Enter the ‘Name of BoM’, say ‘Customer 1’ (where the picture tube used needs to be
manufactured by only BPL) and press ‘Enter.
Press ‘F12: Configure’ and set ‘Define Type of Component for BOM’ to ‘Yes’.
Enter the name of other components that will be used in the production process.
To maintain a record of the resulting by-products, co-products and scrap, you can define the
percentage of these items produced during the production process as well. Then press ‘Enter’.

Enter the name of the second BoM, for instance, ‘Customer 2’ (where there is no restriction on
the type of picture tube used for the production of a TV set).
Enter the name of the components to be used and ‘Save’.
Passing a manufacturing transaction using multiple BoMs

When production happens on the ground, it is important to record the corresponding details into
the system as well. To record the details of the manufacture of a product in Tally.ERP 9, you
need to make an entry using the manufacturing journal voucher. The benefit of creating multiple
BoMs will be seen while creating this voucher entry journals.
When you select ‘Television’ as the name of the product, automatically Tally.ERP

In this way, you can select the type of BoM for every manufacturing voucher you enter.
Benefits of this feature

This feature of Tally.ERP 9 Series A addresses an important requirement of businesses to store
the details of multiple BoMs for one item, on the system. A greater benefit of this feature is that
you can view a consolidated report for a specific item, as a whole. This capability enables you to
do an ageing analysis or track the profitability for the item much faster. Otherwise, you would
need to create two separate items and then consolidate their individual data to produce a
combined report.

GST.
1. Indirect Tax levied on Goods and services
2. It will replace all major indirect taxes levied by center and the state
3. There will be two parts of GST
Central GST(CGST)
State GST(SGST)
INTEGRATED GST
Taxes
Direct Taxes Indirect Taxes

Imposed on person Imposed on goods and services
(Paid Directly to the govt)(Paid to the govt via third person)
Income Tax

Indirect Taxes
Central Govt State Govt
Excise Duty – On Manufacturing VAT – On sale Within State

Service tax – On Services Entertainment tax – On Entertainment
CST – On inter State Sale Luxury Tax – On Luxury Hotel Rooms
Custom Duty – On imports Octroi / Entry Tax – On transfer of goods
Indirect Taxes
Central Govt State Govt
Excise Duty – On Manufacturing VAT – On sale Within State

Service tax – On Services Entertainment tax – On Entertainment
CST – On inter State Sale Luxury Tax – On Luxury Hotel Rooms
Custom Duty – On imports Octroi / Entry Tax – On transfer of goods
CGST SGST
GST

“Cascading Effect” or “Tax on tax”
Cost of Goods 100 Cost of Goods 112

Add.Excise Duty@12% 12 Add.VAT@12.50% 14(100*12.50%)+(12/12.50%)
112 126 12.50+1.50
Advantage of GST
1. It will replace all major indirect taxes.
2. It will remove cascading effect.
3. It will reduce flow of BLACK MONEY.
4. One India one market.
5. Seamless flow of goods across nation.
6. Ease of doing business.
GST Act
One for
Manfacturing Trading Services
Tax
GST Rates
 Rates: 0%( on essential items, rice/wheat)
 5%: ( on items of mass consumption )
 12%/18%:(standard rates covering most manufactured items and Services)
 28% : ( on Consumer Durable Goods, Pan masala, tobacco and aerated drinks etc)
 Basic philosophy behind these rates are that, to the extent possible, the current combined
rate of tax levied on individual goods by the Central and the State Governments should
be maintained in GST
 Uniform GST rate not possible at this stage as luxury goods and goods consumed by
poorer sections of society cannot be taxed at the same rate
 Rates will be notified by Government on recommendations of GST Council.
Why Returns?
 Means of compliance verification.
 Mode for transfer of information to tax administration.
 To declare tax liability for a given period.
 Providing necessary inputs for taking policy decision.

Overview of GST Returns
Monthly
GSTR 1 Statement of Outward Supplies.
GSTR 2 Statement of Inward Supplies.
GSTR 3 Monthly GST Return.
GSTR 5 Non-resident taxable persons.
GSTR 6 Input Service Distributor (ISD) Return.
GSTR 7 Tax Deduction at Source (TDS) return.
GSTR 8 Tax Collection at Source (TCS) Return.
GSTR 11 Inward Supplies for Government Bodies .
Quarterly
GSTR 4 Compounding taxpayer.
Annual
GSTR 9 Annual GST Return.
GSTR 9A Annual return for Compounding Taxpayer.
GSTR 9B Reconciliation Statement.

Unscheduled
GSTR 10 Final return after cancellation, within three month of cancellation.


TDS –TAX DEDUCTION ON SOURCE
TDS on Expenses (Journal Voucher)

Example 1:
On April 12, 2010 Medha Infotech received a Bill (vide No. 220) from Super Agencies for Rs.
4,00,000 towards the Advertisement services provided.
Payment of Party
Example 2:
On April 20, 2010, payment of Rs. 3,92,000 is made towards bill no. Bill-220 to Super Agencies
for the purchase of Advertisement services, vide cheque no. 336584


Payment of TDS
Example 3:
On May 5, 2010, Medha Infotech, paid TDS of Rs. 8,000 towards Advertisement Expenses, vide
cheque no. 336725 for the month of April, 2010.

Generating TDS Challan (ITNS 281)

Tax Collected at Source (TCS)

Tax Collected at Source (TCS) refers to the collection of tax at source by the seller (collector)
from the buyer (collectee/payee) on trading of the goods

Value Added Tax (VAT)

is a type of indirect tax and is one of major source of revenue to the state.
VAT is a indirect tax on every level of Value addition to the product or good.
Input Tax This is the tax paid on purchases

Output Tax This is the tax charged on sales
TIN Tax Identification Number (TIN) is the Registration Number

given by the department to the dealer at the time of
Registration.
315984656565
PAN –PERMANENT ACCOUNT NUMBER

TAX INVOICE – SEPARATE COLUMN or ROW FOR TAX
RETAIL INVOICE – INCLUDING TAX
VAT PAYABLE = OUTPUT TAX – INPUT TAX
To enable VAT in Tally.ERP 9,
Go to Gateway of Tally> F11: Features>
F3: Statutory & Taxation
1. Set Enable Value Added Tax (VAT) to Yes
2. Enable Set/Alter VAT Details to Yes
To create a Purchase Ledger,
Go to Gateway of Tally > Accounts Info. > Ledgers > Create
 Enter the Name of the Purchase Ledger, for e.g., Purchases @ 5%
 In the Under field, select Purchase Accounts
 Set the field Inventory values are affected to Yes
 Set the field Used in VAT Returns to Yes
To create an Input VAT Ledger,

Go to Gateway of Tally > Accounts Info. > Ledgers > Create
 Enter the Name of the Input VAT ledger, for e.g., Input VAT @ 5%
 In the Under field, select Duties & Taxes
 Select VAT in the Type of Duty/Tax field
 Select Input VAT @ 5% in the VAT/Tax Class field
VAT ( 1%5%14.5%)
1% - RESALE TAX
5% - TRADE TAX(PURCHASE & SALES)
14.5% MANUFACTURING( PURCHASE,SALES & PRODUCTION)
PRODUCSOR - > MANUFACTUR -> RETAILER - > CUSTOMER
Vat Exercises
1.Enabling Value added Tax(VAT)
2. Creating Master Ledgers that are affected by VAT
The ledgers that are affected by VAT are:
‡ Purchase Ledger
‡ Sales Ledger
‡ Input VAT Ledger
‡ Output VAT Ledger
# Party Ledger
3. Creating Purchase Voucher without Inventory
On 1-6-09, Universal Traders purchased from Sujan Ltd., Bangalore, Surya Lamps 20 nos at Rs. 300 each & Philips
lamps 30 nos at Rs. 500 each. (Input VAT – 5%.)
4. Creating Purchase Voucher with default VAT Class
On 3-6-09, Universal Traders purchased from Sujan Ltd. Bangalore, Surya Lamps 30 Nos. at Rs. 300 each. VAT @

4% was charged additionally.
5. Creating Purchase Invoice with Selection of VAT Class during Entry
On 3-6-09, Universal Traders purchased from Sujan Ltd. Bangalore, Philips lamps 10 Nos. at Rs. 300 each. VAT @
4% was charged additionally.
6. Creating Purchase Invoice with Multiple VAT Rates
On 5-6-09, Universal Traders purchased the following lamps from Sujan Ltd.
Item Quantity Rate VAT %
GE Lamp 15 Nos 100 12.5
Bajaj Lamp 5 Nos 150 4
7. Creating Sales Voucher without Inventory
On 8-6-09, Universal Traders sold to Chahak Traders, Bangalore, Surya lamps 10 Nos. at Rs.350 each. VAT @ 4%
was charged additionally.
8. Creating Sales Voucher with Default VAT Class
On 15-6-09, Universal Traders sold to Somi Telicomm, Bangalore, Surya lamps 8 Nos. at Rs. 350 each and Philips
lamps 5 Nos. at Rs. 550 each. VAT @ 4% was charged additionally.

Service Tax
Service Tax is a destination based consumption tax in the form of Value Added Tax.
Service Tax is a indirect tax imposed on specified services (taxable services) provided by a
service provider (Company, Individual, Firm etc.)
1.Create Company
2. Enable Service Tax
Service Tax Registration number is a PAN based 15 digit alpha numeric numbers e.g. ASDCE1588D +
ST001 .
To enable Service Tax:
Go to Gateway of Tally > F11: Features > F3: Statutory & Taxation
 Set Enable Service Tax to Yes.
 Enable Set/Alter Service Tax Details to Yes to enter the Company Service Tax Details.
Royal Agency provide Advertising services of Rs. 1,00,000 to SysImage. On the service amount
of Rs.1,00,000, Royal Agency is liable to pay the tax of Rs. 10,300 @ 10.3% (10% on Service
Tax, 2% of Education Cess, 1% of Secondary Education Cess).

Tax Head based Tax Ledgers
Three separate ledger to account both Input service Credit and Output Service Tax of all the
service Cate gories based on the Tax Heads
Example:
Service Tax @ 10% or 14%
Education Cess @ 2% or .5%
Secondary Education Cess @ 1% or .5%

Examples
 On 4-4-2011, ABC company purchased Advertising Services from Krypton Agency
for Rs. 1,00,000 on which service tax is charged @ 10.30%.

 On 5-4-2011 ABC Company paid Rs. 1,10,300 through cheque to Krypton Agency
towards the service bill dated 4-4-2011

 On 2-4-2011, ABC Company purchased Advertising Services from Krypton Agency
for Rs. 2, 20,600 (inclusive of service Tax).
 On 4-4-2011 ABC Company utilized the Input Credit of Rs. 20,600 towards the
service bill dated 2-4-2011
 After utilizing the input credit ABC Company failed to make the payment to
Krypton Agency within Three months from the date of bill and decides to reverse
the Credit availed.
 On 5-7-2011 ABC Company recorded a Input Credit Reversal entry for Rs. 20600.
 On 6-4-2010 ABC Company sold event Management Services to CreativeIn Ad
Agency for Rs.2,50,000 on which service tax is charged @ 10.30%

 On 7-4-2010 ABC Company Received Rs. 1,10,300 through cheque from Creative
In Ad Agency towards the service bill dated 5-4-2010

 On 7-4-2010 ABC Company Received Rs. 1,10,300 through cheque from Creative
In Ad Agency towards the service bill dated 5-4-2010

Excise Duty or Duty on Excise
is a tax on goods manufactured or produced in India an intended for domestic consumption i.e.
sale in India .
Excise Registration (of Factory/Warehouse)
Excise Control Code (ECC) Number
Category Code
Central Excise Manufacturer XM
(Including registered warehouses)

Registered Dealer XD
ABCDE1234H XM 001 (for Factory)
ABCDE1234H XD 001 (for Dealer)
1. Create Company
2. Enable Excise from features (F11)
3. Enable VAT
MASTERS
Sales & Purchase Ledgers Duties & Taxes Ledger
1. Basic Excise Duty 10%
2. Educational cess @2%
3. Secondary Educational Cess @1%
4. vat 4% or 12.5%
Party Ledgers
Stock Items WITH TARRIF CODE
Voucher Types

1. Ad Valorem/ Transaction Value:
to make provision for, advertising or publicity, marketing and selling, organization expenses, storage, outward
handling, servicing, warranty, commission or any other matter.
2. Ad Quantum:
In case wof Ad Quantum the duty is payable on the basis of certain unit Like Weight, Length, volume etc.
3. Value determined on the basis of Maximum Retail Sale Price(MRP).
Purchase Order with Excise Details
Example: On 28-6-2008 Rajesh Industries placed a purchased with Lanco Manufacturers for
the
supply of 50,000 Pet Bottles @ 3 per bottle.

PAYROLL
Enabling Payroll in Tally.ERP 9

Create a new company in Tally.ERP 9 and follow the steps given below to enable Payroll.
Case Study Company

MS Software Solutions is engaged in the Software services Business. It is a Hosur-based
company with the following three major departments:
 Sales
 Administration
 R&D
Step 1: Company Setup

Go to Gateway of Tally > Company Info. > Create Company
 Press Enter to Accept the completed Company Creation screen
Step 2: Enable Payroll

Go to Gateway of Tally > Press F11: Company Features > press F1: Accounting Features
In the F11: Accounting Features screen:
Set Maintain Payroll to Yes

Set More than ONE Payroll / Cost Category to Yes
F11: Accounting Features screen is displayed
 P
r
ess Enter to Accept the F11: Accounting Features screen.
It takes five easy steps to process payroll & generate Pay Slip in Tally.ERP 9.

Essentially, Payroll involves the calculation of amounts due for an employee on the
following basis:
 Pay on Hourly wages
 Pay on a fixed basis such as certain amount per week, per month and so on Pay to sales
persons on commission
 Reimbursement of expenses such as travel expenses, either as paid by the employee or
based on per item rate
 Pay on the basis of number of pieces produced/ manufactured/ sold
It is therefore essential to quantify the following payroll information for the purpose of
computation of payments to employees. For this purpose, the following Payroll masters have
to be created in Tally.ERP 9 in the manner as discussed:
 Employee Masters
 Payroll Masters
 Pay Heads
 Salary Details
Employee Setup
The Employee Master records employee information – department, date of joining, date of
leaving, ID number, designation, location, function, employee bank details, statutory details,
Passport and Visa details, and so on.
Employee Details:
 Employee Category
 Employee Groups
 Employees
Employee Category
Go to Gateway of Tally > Payroll Info. > Employee Category
Employee Groups
i.e., Production, Sales, Marketing, Stores, Support or a particular group of employees such as
managers, supervisors, sub-staff and so on.
To create Sales as an Employee Group:
Go to Gateway of Tally > Payroll Info. > Employee Groups > Create In the Employee Group
Creation screen,
1. Select Primary Cost Category as the Category (You can also create a separate cost
category to segregate Employee Cost based on respective categories)
2. Type Sales as the Name of the Employee Group
3. Select the group as Primary (Tally.ERP 9 allows an unlimited grouping of Employee
Groups)
The Employee Group Creation screen is displayed as shown:
 Press Enter to Accept the Employee Group Creation screen
Employee Master
Go to Gateway of Tally > Payroll Info. > Employees > Create
In the Employee Creation screen,
1. Select the Primary Cost Category as the Category
2. Type the Name of the Employee as Vijay Kumar
3. Specify the Name of the Employee Group as Administration in the field ‘Under’.
4. Specify the Date of Joining as 01-04-2018


 Press Enter to Accept the screen.
Payroll Masters
As discussed in the above section Pay components are computed based on the Payroll Units.
Therefore, create the following Payroll masters in Tally.ERP 9:
 Payroll Units
 Attendance / Production Types
Payroll Units
Payroll Units refer to individual units such as Day, Week, Month, Hours, Pcs, Box, Nos
etc., Whereas, Compound Payroll Units refer to Units which are combination of two simple
units, i.e., an Hour of 60 Minutes, Month of 26 days, Day of 8 Hrs.
Calculation Periods – Days, Fortnights, Months & Weeks.
Name Type Symbol
Hours Simple Hrs
Minutes Simple Mins
Hrs of 60 Mins Compound Hrs of 60 Mins
Simple Payroll Units
Go to Gateway of Tally > Payroll Info. > Units (Work) > Create
In the Unit Creation screen,
1.Simple is defaulted as the Type of Unit

2.Specify Hrs as the Symbol
3.Type Hours as the Formal Name
4.Specify 2 as the Number of Decimal Places
The completed Unit Creation screen is displayed as shown:
 Press Enter to Accept the Unit Creation screen.
Compound Payroll Units

Create Hrs of 60 Mins as a Compound Unit.
In the Unit Creation screen:
1.Press Backspace and select Compound as the Type of Unit
2.Specify Hrs as the First Unit
3.Enter 60 as the Conversion
4.Specify Mins as the Second Unit

Attendance/ Production Types

Attendance types based on time such as Present and Absent, based production units such as
Piece productions, Sales performance.
Create the following Attendance Types for MS Software Solutions
Name Under Attendance / Production Period type
Present Primary Attendance / Leave with Pay Days
Absent Primary Leave without pay Days
Overtime Primary Production Hrs of 60 Mins
Present Attendance Type
Go to Gateway of Tally > Payroll Info. > Attendance / Production Types > Create
In the Attendance Type Creation screen,
1. Type Present as the Name of the Attendance type
2. Specify the group as Primary in the field ‘Under’. By default primary is selected.
3. Select Attendance/ Leave with Pay as the Attendance Type and the Period Type appears
as Days, by default.
4. The completed Attendance Type Creation screen is displayed as shown:

Absent Attendance Type

The completed Attendance Type Creation screen is displayed as shown:
 Press Enter to Accept the Attendance Type Creation screen.

In the same way, create Overtime as the Production Type with Production as the Attendance
Type.
Overtime Production Type

The completed Overtime - Production Type Creation screen is displayed as shown below:

Pay Heads
Some examples of Earnings Pay Heads are Basic Salary, Dearness Allowance, City
Compensatory Allowance, House Rent Allowance, Night Shift Allowance, Uniform Allowance,
Sales Commission and so on. Some examples of Deductions pay heads are Employees’ Provident
Fund (EPF), Employees’ State Insurance (ESI) Professional Tax, Income Tax, TDS, and
Advance.
The pre-set Pay Head types in Tally.ERP 9 are:
1. Earnings for Employees
2. Deductions from Employees
3. Employees’ Statutory Deductions
4. Employer’s Statutory Contributions
5. Employer’s Other Charges
6. Bonus
7. Gratuity
8. Loans and Advances
9. Reimbursements to Employees
The pay heads marked with the above pay head types will be available during payroll
processing, and if the Pay Head Type is marked as Not Applicable, it will not be available. The
Salary Payable, PF Payable, ESI Payable ledgers should be created by selecting Not Applicable
as the Pay Head Type.
Create the following pay heads in the books of MS Software Solutions.
Earning Pay Heads

Create the following Earnings Pay Heads:
Pay Head Pay Head Under Affect Name to Use for Calcul Calculation
Name Type Net Appear in Gratuity ation Period/
Salary Pay Slip Type Production
Type
Basic Pay Earnings Indirect Yes Basic Yes On
for Expenses Attend Months
Employees ance
House Rent Earnings Indirect Yes HRA No As
Allowance for Expenses Comp
-
Employees uted
Value
Conveyance Earnings Indirect Yes Conveyance No Flat Months
for Expenses Rate
Employees
Overtime Earnings Indirect Yes Overtime No On Overtime
Pay for Expenses Pay Produc
Employees tion

Basic Pay Head Creation

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
In the Pay Heads Creation screen,
1. Type Basic Pay as the Name of the Pay Head
2. Select Earnings for Employees in the field Pay Head Type.
 The Pay Head Creation screen
 Select Present in the field Attendance/ Leave with Pay.
 The Pay Head Creation screen with the List of Attendance Types
 Select Months in Calculation period field and press Enter
 The Pay Head Creation screen with the List of Calculation Periods
 Select Normal Rounding as the Rounding Method and press Enter.
 Specify 1 as the rounding Limit (The Rounding limit allows the value to be in multiples of
the limit specified and is based on the Rounding Method selected).
 The completed Basic Pay Head Creation screen is displayed as shown:
 P
r
ess Enter to Accept the screen.

House Rent Allowance Pay Head Creation

In the Pay Head Creation screen,
1. Type House Rent Allowance as the Name of the Pay Head
2. Select Earnings for Employees in the field Pay Head Type
3. Specify the group as Indirect Expenses in the field Under and then press Enter
4. Set Affect Net Salary to Yes
5. Specify HRA as the Name to appear in Pay Slip
6. Set Use for Gratuity to No
7. Select As Computed Value in the Calculation Type field and press Enter
8. Select Normal Rounding as the Rounding Method and 1 as the rounding Limit and press
Enter
9. In the Computation Info screen, select On Specified Formula in the Compute field.
10. Press Enter and the Compute sub screen is displayed.
11. In the Sub-screen Compute:
 Select Basic Pay as the Add Pay Head function and press Enter
 Select End of List
12. Specify 1-4-2018 as the Effective From date (In case of a revision in pay structure, you
can define the revised computation information for the given pay head, by giving the
effective from date).
13. The From Amount column is automatically skipped, assuming it to be zero. Press Enter
to skip the Amount Up to column.
14. Select Percentage as the Slab Type from the List of Slabs
15. Specify 40% in the Value Basis field and press Enter
The completed House Rent Allowance (HRA) Pay Head Creation screen is displayed as
shown.


Conveyance Pay Head Creation

Create the Conveyance Pay Head with Calculation Type as Flat Rate.
The completed Conveyance Pay Head Creation screen is displayed as shown:
iv.
Overtime Pay Head Creation

Create the Overtime Pay Head with Calculation Type as Production.
The completed Overtime Pay Head Creation screen is displayed as shown:

• Press Enter to Accept the screen.
Deduction Pay Heads

Create the following Deduction Pay Heads.
Pay Head Pay Head Statutory Under Affect Name to Calculati Computat
Name Type Pay Type Net Appear on Type ion
Salary in Pay Method
Slip
Employees’ Employees PF Current Yes EPF @ As On
PF ’ Statutory Account Liabiliti 12% Computed Specified
Contribution Deductions (A/c No.1) es Value Formula
@ 12%
Employees’ Employees Employee Current Yes On Basic Pay
ESI ’ Statutory State Liabiliti ESI @ Specified + HRA +
Contribution Deductions Insurance es 1.75% Formula Conveyan
@ 1.75% ce + OT
Pay (or
Current
Earnings
Variable
Pay)
i. Employee’s PF Contribution @ 12% Pay Head Creation
Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
1. Type Employee’s PF Contribution @ 12% as the Name of the Pay Head
2. Select Employees’ Statutory Deductions in the field Pay Head Type and press Enter.
3. Select PF Account (A/c No. 1) in the Statutory Pay Type field
4. Specify the group as Current Liabilities in the field ‘Under’ and press
5. Set Affect Net Salary to Yes
6. Specify EPF @ 12% in the field Name to appear in Pay Slip
7. As Computed Value appears in the field Calculation Type by default
8. Select Normal Rounding as the Rounding Method. Specify 1 as the rounding Limit
and press Enter
9. Select On Specified Formula as the Compute method and press Enter.
10. In the Compute sub-screen, select Basic Pay as the Add Pay Head function and press
Enter.
11. Press Enter to Accept the screen
12. Specify 1-4-2018 as the Effective From date
13. The column From Amount is automatically skipped, with the assumption that the
amount is zero.
14. Specify 6500 in the Amount Upto column and press Enter
15.Select Percentage as the Slab Type from the List of Slabs

16.Specify 12% as the Value Basis Percentage and press Enter (the From Amount is
defaulted as 6500)
17.Press Enter to accept the upper level as 0 and select Value as the Slab Type from the List
of Slabs
18.Specify Rs. 780 in the Value Basis field and then press Enter.
19.Press Enter twice
The completed Employee’s PF Contribution @ 12% Pay Head Creation screen is displayed as
shown:
ii. Employee’s ESI Contribution @ 1.75% Pay Head Creation

Create Employee’s State Insurance (ESI) Pay Head as discussed.
1.Type Employee’s ESI Contribution @ 1.75% as the Name of the Pay Head
2.Select Employees’ Statutory Deductions in the field Pay Head Type
3.Select ESI in the field Statutory Pay Type
4.Specify the group as Current Liabilities in the field Under and press Enter
5.Set Affect Net Salary to Yes
6.Specify ESI @ 1.75% in the field Name to appear in Pay Slip
7. As Computed Value appears by default in the field Calculation Type

8.Select the option Normal Rounding as the Rounding Method. Specify 1 as the rounding Limit
and press Enter
9.Select On Specified Formula in the field Compute and press Enter.
In the Compute On Sub-screen, sub screen,
 Select Basic Pay as the Add Pay Head function and press Enter
 Select House Rent Allowance as the second Pay Head in the Add Pay Head Function
 Similarly, select Conveyance and Overtime Pay as the Add Pay Head function
10.Specify 1-4-2018 as the Effective From date
11.The From Amount and Amount Upto fields are skipped as the amount is already entered
in the Statutory & Taxation screen
12.Select Percentage as the Slab Type from the List of Slabs
13.Specify 1.75% as the Value Basis Percentage and press Enter
The Pay Head Creation screen is displayed as shown:
The completed ESI – Employee’s Contribution Pay Head Creation screen is displayed as
shown:


















Salary Details Setup

The Salary Details masters contain information on the Employee Group/ individual employee
pay structure, comprising of both earnings and deductions pay components for the applicable
period.
 To define Salary Details for employees,
 Go to Gateway of Tally > Payroll Info. > Salary Details > Create.
1) Select Harini from the List of Employees and press Enter

In the Salary Details screen,
The Effective date is entered as 01-04-2018 by default based on the Date of Joining entered in
the Employee Master
 Select Basic Pay as the Pay Head from the List of Pay Heads
 Specify 10,000 as Rate
 The Attendance units, Pay Head Type and Calculation Type appear by default, based on
the pay head definitions.
2) Select House Rent Allowance as the second Pay Head and press Enter
3) Select Conveyance as the next Pay Head
4) Specify 800 as Rate and press Enter
5) Select Overtime Pay as the Pay Head
6) Specify 55 as the Rate and press Enter
7) Select Variable Pay as the Pay Head and press Enter
8) Select Professional Tax against the Pay Head and press Enter
9) Select Employee’s PF Contribution @ 12%, Employee’s ESI Contribution @ 1.75% as
Pay Head and press Enter
10) Select the Gratuity Expenses (Provisional) ledger and press Enter (In case of Employees
eligible for Gratuity, the Gratuity Expenses ledger should be included in the Salary
details of the respective Employee for provisional assessment of Gratuity).

The completed Salary Details Creation screen for Mrs Harini is displayed as shown:
Example 1:
On 30th April, 2009 the attendance records of M/s. Spectrum Solutions displayed the following
details:
Attendance/ Production Types Harini
Present Days 26
Overtime hours 900 Min (15hr x 60min)
Go to Gateway of Tally > Payroll Vouchers
1.Press Ctrl+F5 for Attendance Voucher
The Attendance Voucher Creation screen is displayed as shown:
2.Press F2 and specify the date as 30-4-2018

3.Press Enter
4.Press Alt+A (Attendance Auto Fill) to prefill employee payroll details.

The Attendance Auto Fill screen is displayed as shown:

In the Attendance Auto Fill screen,

 Specify the Voucher Date as 30-04-2018 if not specified earlier
 Select Primary Cost Category as Employee Category (If separate cost categories are
used to capture employee cost, then select the respective Employee category)
5.Select All Items as Employee/ Group (if you want to generate payroll voucher for individual
employee/ group, select the respective employee or group)
6.The Attendance Auto Fill with Employee Filters
7.Select Present as Attendance Type in the Attendance/ Production Type field
8.Specify the require value that should be prefilled for all Employees e.g. 26
9.Employees pertaining to the respective Employee Groups are displayed automatically
10.The Attendance Voucher Creation screen with the attendance details screen is displayed as
shown:

Payroll Reports
Chart showing Payroll Reports in Tally.ERP 9
Display Pay Slip

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip >
Single Pay Slip
 Select the required Employee and press Enter
The Pay Slip for the selected employee is displayed as shown:

reports
Financial Statements and Reports
2. Account Books and Register

3.Banking Reports
4.Inventory Registers and Reports
5.Job Work Registers and Reports
6.Job Costing Registers and Reports
7.POS Registers and Reports
8.Value Added Tax Reports
9.Service Tax Reports
10.Tax Collected at Source Reports
11.Tax Deducted at Source Report
12.Excise for Dealer Reports
13.Excise for Manufacturer Reports
14.Payroll Registers and Reports


TALLY ERP 9 Final

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APOLLO COMPUTER

Tally ERP 9.0 Text Book

TALLY ERP 9.0

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109.

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

Accounting: - Accounting is a process of identifying, recording, summarizing and

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

Words for Accounting:-

Account: - An account is a statement of transactions affecting any particular asset,

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

Debit What Comes in The Receiver Expenses and Losses

Credit What Goes out The Giver Incomes and Gains

Simple & Double Entry System of Book Keeping

Each transaction makes two effects on business.

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

DOS based accounting as it could not be run on windows operating system

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

it interacted with other system through Open Data Base Connectivity.

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

To enable company features

1. Go to Gateway of Tally > click F11: Features .

2. Select the required features in the Company Features menu.

3. Enable the required features.

4. Press Ctrl+A to accept.

F1: Accounting Features

The F1: Accounting Features screen is displayed as shown:

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

F2: Inventory Features

The F2: Inventory Features screen is displayed as shown:

Enable the required features and press Enter to accept

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

F3: Statutory & Taxation

The F3: Statutory & Taxation screen is displayed as shown:

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

F4: Tally.NET Features

F12 Configuration Menu

Go to Gateway of Tally > press F12: Configure

The Configuration screen is displayed as shown:

Getting started with Tally.ERP 9 Start-up

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

Setting up of Company in Tally.ERP 9

Go to Gateway of Tally > Company Info. > Create Company

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

o Press Y or Enter to accept the screen

Go to Gateway of Tally > press Alt+F3 (Company Info.) > Alter

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

Ledger and Groups

Predefined Groups of Accounts

Gateway of TallyAccounts InfoLedger Create

APOLLO COMPUTER, NEAR ARRS SILKS, HOSUR – 635 109. Page 40

Name: Enter here the party’s/ Ledgers name.

Alias: If you want to give alias name

Pin Code: Enter the pin code.

Opening balance: Enter opening balance if any.