Business Accounting Software

(Using Tally.ERP9)
PRACTICAL FILE
Submitted for partial fulfillment for the award of the
Degree of

BACHELOR OF COMMERCE
(B.COM (H) 2022 - 2025)
Under the supervision of
Dr. Ashu Lamba
Submitted by
NAME- AKSHAY RANA
ENROLLMENT NO. - 80917788822

SCHOOL OF BUSINESS STUDIES

VIVEKANANDA INSTITUTE OF PROFESSIONAL STUDIES
(Affiliated to Guru Gobind Singh Indraprastha University)
TABLE OF CONTENTS
Unit 1......................................................................................................................................
Introduction to Accounting......................................................................................................
Difference between Book Keeping and Accounting..................................................................
Types of Accounts....................................................................................................................
Rules of Journal Entries...........................................................................................................
Trial Balance............................................................................................................................

Unit 2....................................................................................................................................
Introduction to Tally..............................................................................................................
Introduction to Tally. ERP 9...................................................................................................
Salient Features of Tally. ERP 9..............................................................................................
Functional Features of Tally. ERP 9........................................................................................
Technology Advantages.........................................................................................................
Creating a company in Tally. ERP 9........................................................................................
Features:...............................................................................................................................
Configurations.......................................................................................................................
Ledgers..................................................................................................................................
Groups...................................................................................................................................
Ledger Creation.....................................................................................................................
Group Creation......................................................................................................................
Accounting Vouchers.............................................................................................................
Accounting Vouchers.............................................................................................................
Daybook................................................................................................................................
Range....................................................................................................................................

UNIT 3...................................................................................................................................
BANK RECONCILIATION STATEMENT......................................................................................
EXPORT AND IMPORT............................................................................................................
INVENTORY MANAGEMENT IN TALLY.ERP 9..........................................................................
INVENTORY AND ORDER VOUCHER QUESTION......................................................................
STOCK SUMMARY..................................................................................................................
BILL OF MATERIALS................................................................................................................
BILL OF MATERIALS EXERCISE................................................................................................
Ratio Analysis........................................................................................................................
Trial Balance..........................................................................................................................
Balance Sheet........................................................................................................................
Cash Flow Summary..............................................................................................................
Funds Flow Summary...........................................................................................................100
 Unit 1
Introduction to Accounting
Accounting can be defined as a process of reporting, recording, interpreting
and summarizing economic data. The introduction of accounting helps the
decision-makers of a company to make effective choices, by providing
information on the financial status of the business.

The American Institute of Certified Public Accountants (AICPA) had defined

accounting as the “art of recording, classifying, and summarizing in a significant
manner and in terms of money, transactions and events which are, in part at
least, of financial character, and interpreting the results thereof”.

Objectives of Accounting
The main objectives of accounting are:

• To maintain a systematic record of business transactions

Accounting is used to maintain a systematic record of all the financial

transactions in a book of accounts. For this, all the transactions are recorded in
chronological order in Journal and then posted to principle book i.e., Ledger.

• To ascertain profit and loss

Every businessman is keen to know the net results of business operations

periodically. To check whether the business has earned profits or incurred
losses, we prepare a “Profit & Loss Account”.

• To determine the financial position

Another important objective is to determine the financial position of the

business to check the value of assets and liabilities. For this purpose, we
prepare a “Balance Sheet”.

• To provide information to various users

Providing information to the various interested parties or stakeholders is one
of the most important objectives of accounting. It helps them in making good
financial decisions.

• To assist the management

By analyzing financial data and providing interpretations in the form of reports,

accounting assists management in handling business operations effectively.

Characteristics of Accounting:
The following attributes or characteristics can be drawn from the definition of
accounting:

(1) Identifying financial transactions and events

Accounting records only those transactions and events which are of financial
nature. So, first of all, such transactions and events are identified.

(2) Measuring the transactions

Accounting measures the transactions and events in terms of money which are
considered as a common unit.

(3) Recording of transactions

Accounting involves recording the financial transactions inappropriate book of

accounts such as Journal or Subsidiary Books.

(4) Classifying the transactions

Transactions recorded in the books of original entry – Journal or Subsidiary

books are classified and grouped according to nature and posted in separate
accounts known as ‘Ledger Accounts’.

(5) Summarizing the transactions

It involves presenting the classified data in a manner and in the form of

statements, which are understandable by the users. It includes Trial balance,
Trading Account, Profit and Loss Account and Balance Sheet.
 (6) Analyzing and interpreting financial data

Results of the business are analyzed and interpreted so that users of financial
statements can make a meaningful and sound judgment.

(7) Communicating the financial data or reports to the users

Communicating the financial data to the users on time is the final step of
accounting so that they can make appropriate decisions.

Difference between Book Keeping and

Accounting
Parameters Bookkeeping Accounting
Scope Bookkeeping involves In addition to bookkeeping,
identifying, measuring, Accounting also includes
recording & classifying summarizing, interpreting
financial transactions in and communicating the
the ledger accounts. financial data to the users
of financial statements.
Objective The main aim is to The main aim is to ascertain
maintain systematic the profitability and
records of financial financial position of the
transactions. business.
Stage It is a primary stage of It is a second stage and
accounting. begins where bookkeeping
ends.
Nature of job This job is in routine and This job is analytical in
repetitive in nature. nature.
Level of skills Bookkeeping does not It requires specialized skill
require special skills. It is to analyze, so it is
performed by Junior Staff. performed by senior staff.

Types of Accounts
Personal Account
These accounts types are related to persons. These persons may be natural
persons like Raj’s account, Rajesh’s account, Ramesh’s account, Suresh’s
account, etc. These persons can also be artificial persons like partnership firms,
companies, bodies corporate, an association of persons, etc.

Rule for this Account: -

Debit the receiver.

Credit the Giver.

Real Accounts
These account types are related to assets or properties. They are further
classified as Tangible real account and Intangible real accounts.

Tangible Real Accounts: -

These include assets that have a physical existence and can be touched. For
example – Building A/c, cash A/c, stationery A/c, inventory A/c, etc.

Intangible Real Accounts: -

These assets do not have any physical existence and cannot be touched.
However, these can be measured in terms of money and have value. For
Example – Goodwill, Patent, Copyright, Trademark, etc.

Rule for this Account: -

Debit what comes into the business.

Credit what goes out of business.

Nominal Account
These accounts types are related to income or gains and expenses or losses.
For example: – Rent A/c, commission received A/c, salary A/c, wages A/c,
conveyance A/c, etc.

Rule for this Account: -

Debit all the expenses and losses of the business.

Credit the incomes and gains of business.
 Rules of Journal Entries

The rules for debit and credit as per types of accounts, that is, personal, real
and nominal account, are as follows:

Types of Accounts Rules for Debit Rules for Credit

Personal Account Debit the Receiver Credit the Giver
Real Account Debit what comes In Credit what goes Out
Nominal Account Debit all Expenses and Credit all Incomes
Losses &Gains

The rules for debit and credit as per modern classification or accounting
equation-based classification:

Types of Accounts Rules for Debit Rules for Credit

Assets Accounts Debit the increase Credit the decrease
Liabilities Accounts Debit the decrease Credit the increase
Capital Accounts Debit the decrease Credit the increase
Revenue Accounts Debit the decrease Credit the increase
Expenses Accounts Debit the increase Credit the decrease

Trial Balance

A trial balance is a bookkeeping worksheet in which the balances of all ledgers

are compiled into debit and credit account column totals that are equal. A
company prepares a trial balance periodically, usually at the end of every
reporting period. The general purpose of producing a trial balance is to ensure
that the entries in a company’s bookkeeping system are mathematically
correct.
A trial balance can be used to detect any mathematical errors that have
occurred in a do. A trial balance is a worksheet with two columns, one for
debits and one for credits, that ensures a company’s bookkeeping is
mathematically correct. The debits and credits include all business transactions
for a company over a certain period, including the sum of such accounts as
assets, expenses, liabilities, and revenues.
Debits and credits of a trial balance must tally to ensure that there are no
mathematical errors. However, there still could be mistakes or errors in the
accounting systems. A trial balance can be used to assess the financial position
of a company between full annual auditable entry accounting system. If the
total debits equal the total credits, the trial balance is considered to be
balanced, and there should be no mathematical errors in the ledgers.

Limitations
A trial balance only checks the sum of debits against the sum of credits. That is
why it does not guarantee that there are no errors. The following are the main
classes of errors that are not detected by the trial balance.
• An error of original entry is when both sides of a transaction include the
wrong amount. For example, if a purchase invoice for rs.21 is entered as
rs.12, this will result in an incorrect debit entry (to purchases), and an
incorrect credit entry (to the relevant creditor account), both for rs.9
less, so the total of both columns will be rs.9 less, and will thus balance.
• An error of omission is when a transaction is completely omitted from
the accounting records. As the debits and credits for the transaction
would balance, omitting it would still leave the totals balanced. A
variation of this error is omitting one of the ledger account totals from
the trial balance (but in this case the trial balance will not balance).
• An error of reversal is when entries are made to the correct amount, but
with debits instead of credits, and vice versa. For example, if a cash sale
for rs.100 is debited to the Sales account, and credited to the Cash
account. Such an error will not affect the totals.
• An error of commission is when the entries are made at the correct
amount, and the appropriate side (debit or credit), but one or more
entries are made to the wrong account of the correct type. For example,
if fuel costs are incorrectly debited to the postage account (both
expense accounts). This will not affect the totals. This can also occur due
to confusion in revenue and capital expenditure.
• An error of principle is when the entries are made to the correct
amount, and the appropriate side (debit or credit), as with an error of
commission, but the wrong type of account is used. For example, if fuel
costs (an expense account), are debited to stock (an asset account). This
will not affect the totals.
• Compensating errors are multiple unrelated errors that would
individually lead to an imbalance, but together cancel each other out.

Unit 2
Introduction to Tally
Founders of Tally
Tally Solutions was co-founded in 1986 by Shyam Sunder Goenka
and his son Bharat Goenka after the family's cotton business was
destroyed by fire. It began as Peutronics Financial Accountant, an
accounting software application. The company was incorporated in
1991 and was renamed Tally Solutions in 1999.

Previous Name of Tally

Bharat Goenka developed an accounting software called ’The
Accountant’ with no-codes. He and his father together started
Peutronics in 1986 -- renamed as Tally from 1988. The latest version
is Tally ERP 9 is the world's first concurrent multi-lingual business
accounting and inventory software.

Historical Versions of Tally

TALLY 3.0
This version was released in 1990. It was basic accounting software only and
fulfilled the needs of small enterprises. Basic pre-defined operating commands
were required to operate this version software. It ran in Microsoft Disk
Operating (MS – DOS) only.

Tally 3.12
This version released in 1991 and similar to previous version but developed
some accounting features

Tally 4
This version was released in the year 1992. This was also MS DOS based
application and better version than previous versions.

Tally 4.5
This version was released in the year 1994 and like previous versions, this was
also ms dos-based application.

Tally 5
This version was released in the year 1996. This was the first version of tally
with windows operating system. And this version also included Inventory
modules. Inventory means, stock and godowns maintenance.

Tally 5.4
This version was released in 1996 and updated version of 5.0. Tally 5.4 version
has data import facility and it can convert old data formats to newer one.

Tally 6.3
This version was released in 2001. This version has open data base connectivity
(ODBC) which can it interact with other system.

Tally 7.2
This version was released in 2005. This version has taxation system. It included
the taxes like Value added tax (VAT), Central sales Tax (CST), Tax Deduction at
source (TDS), Tax collection at source (TCS) and Service Tax.

Tally 8.1
This version was released in 2006. It has the feature of Multi Languages and
support of 10 languages.

Tally 9.0
This version also released in 2006, and updated version of 8.1. In this version,
Multi Language support increased to 13. And new features like Payroll, Point
Of Sale (POS) included in this.

TALLY ERP 9
ERP stands for Enterprise Resource Planning. This is the version which can give
industries a complete business solution. This version includes remote access,
tally. net, remote access and data security etc.
Tally Prime 2.1
The latest version of tally is Tally Prime version 2.1 which was launched in the
month of March in 2022.

Introduction to Tally. ERP 9

Tally. ERP 9 is one of the most widely used financial software. Tally. ERP 9
reports can help a business owner make informed decisions to increase
efficiency, reduce costs, and organize business operations.

With Tally. ERP 9, accurate, up-to-date business information is available at your

fingertips anytime. It provides a Comprehensive solution for the accounting
and inventory needs of a business.

It provides the capability to generate fully accurate tax returns in a matter of

minutes and is also capable of extracting, interpreting and presenting financial
data.

Tally. ERP 9 is the world’s fastest and most powerful concurrent Multi-lingual
business Accounting and Inventory Management software. It is designed
exclusively to meet the needs of small and medium businesses, is a fully
integrated, affordable and highly reliable software. It is easy to buy, quick to
install, and easy to learn and use. It is designed to automate and integrate all
your business operations, such as sales, finance, purchasing, inventory, and
manufacturing. With Tally. ERP 9, accurate, up-to-date business information is
literally at your fingertips anywhere. The powerful new features and blazing
speed and power of Tally. ERP 9 combined with enhanced MIS, Multilingual,
Data Synchronization and Remote capabilities help you simplify all your
business processes easily and cost-effectively.

Salient Features of Tally. ERP 9

• A leading accounting package: The first version of Tally was released in
1988 and, through continuous development, is now recognized as one of the
leading accounting packages across the world, with over a quarter million
customers. Tally’s market share is more than 90%.
• No accounting codes: Unlike other computerized accounting packages
which require numeric codes, Tally. ERP 9 pioneered the ‘no accounting codes’
concept. Tally. ERP 9 users have the freedom to allocate meaningful names in
plain English to their data items in the system.

• Complete business solution: Tally. ERP 9 provides a comprehensive

solution to the accounting and inventory needs of a business. The package
comprises financial accounting, book-keeping and inventory accounting. It also
has various tools to extract, interpret and present data.

• Integrated/Non-integrated accounting and inventory: With Tally. ERP

9, the user is able to choose to maintain accounts only. If accounting with
inventory is opted for, the user can choose whether it should be integrated or
not.

• Flexible and easy to use: Tally. ERP 9 is very flexible. It mimics the
human thought process, which means that Tally. ERP 9 can adapt itself to any
business need. Tally. ERP 9 users need not change the way their business is run
to adapt themselves to the package.

• Speed: Tally. ERP 9 provides the capability to generate instant and

accurate reports, which assist the management to take timely and correct
decisions for the overall productivity and growth of the company.

• Power: Tally. ERP 9 allows the user to maintain multiple companies and
with unlimited levels of classification& grouping capabilities. It also allows drill
down facility from report level to transaction level

• Flexibility: Tally. ERP 9 provides flexibility to generate instant reports for

any given period (month/year) or at any point of time besides providing the
facility to toggle between Accounting & Inventory reports of the same
company or between companies.

• Concurrent multilingual capability: Tally. ERP 9 offers you the exclusive

capability of maintaining your accounts in any Indian language, viewing them
in another language and printing them in yet another Indian language.
• Real time processing: Immediate posting & updating of books of
accounts as soon as the transactions are entered, thereby facilitating instant
statements & Reports. It also facilitates a real-time multi-user environment.

• Versatility: Tally.ERP9 is suitable for a range of organizations, from small

grocery stores to large corporations with international locations and
operations.

• Multi-platform availability: Tally. ERP 9 is available on multiple versions

of windows. It runs on a single PC or on a network. On a network, it supports
access via any combination of platforms.

• Online Help: The Tally. ERP 9 Online Help (Alt+H) provides instant
assistance on basic and advanced features or any other relevant topics of Tally.
ERP 9

• Tally.NET: is an enabling framework which establishes a connection

through which the remote user can access the client’s data without copying /
transferring the data.

• Remote Access: Tally. ERP 9 provides remote capabilities to access the

data from anywhere and anytime.

• Control Centre: works as an interface between the user and Tally. ERP 9
installed at different sites and enables the user to centrally configure and
administer Site/User belonging to an account.

• Support Centre: allows a user to directly post his support queries on the
functional and technical aspects of the Product.

• Auditor’s Edition: Tally. ERP 9 offers a special Auditors’ Edition of Tally.

ERP 9, which provides auditing and compliance capabilities exclusively for
Chartered Accountants.

Functional Features of Tally. ERP 9

Basic Accounting Basic Inventory
Complete book-keeping Stock categories
Books, registers and statements of Stock query by stock group, or stock
accounts category
General ledgers Multiple godowns
Accounts receivable and accounts Stock transfers to godowns and
payable branches
Flexible voucher numbering Multiple stock valuation methods
Flexible classification of account Batch-wise/Lot-wise, including expiry
heads date handling
Panoramic view Alternate units of measure and tail
units
Drill-down display Tracking through receipt
notes/delivery notes/rejections
inwards/rejections outwards
Database reporting Additional costs incurred on purchase
Voucher and cheque printing Movement/Profitability analysis Party-
wise/Item-wise/ Stock Group-wise
Columnar reports Customizable sales invoices using
price lists with multiple prices
Bank reconciliation Sales and purchase order processing
Cash flow statement

Advanced Accounting Advanced Inventory

Multiple companies Stock items classified as raw
materials, work-in-process, finished
goods
Multi-currency Bill of Material with auto-adjustment
of stocks
Multiple financial years Job-working concepts, including sub-
contracting
Comparison of data using multi- Additional cost of manufacturing with
columnar reporting notional value and percentage
Memo vouchers CENVAT support
Post-dated vouchers Reorder levels
User-defined voucher types Stock ageing analysis
Sales and purchase extracts Batch related stock reports
Daily balances and transaction Point of Sale (POS)
values/ Interest calculations
Percentage-based reporting Excise/ VAT/ Central Sales Tax (CST)/
Tax Collected at Source (TCS) related
 Inventory transactions and reports
Ratio analysis
Value Added Tax (VAT)/ Central
Sales Tax (CST)
Service Tax (ST)
Tax Deducted at Source (TDS)
Tax Collected at Source (TCS)
Excise
Payroll

Technology Advantages
• Simple and rapid installation: Tally. ERP 9 has a simple, menu-
driven installation procedure. The user can install the program files on any
drive if the hard disk has partitions. The user can also specify the name and
directory location of the program files. Tally. ERP 9 uses minimum hard disk
space in the local drive. Its installation on the local disk takes just a few
seconds.

• Unlimited multi-user support: A multi-user version of Tally. ERP 9

can be installed on a network, having any number of computers with different
operating systems such as Win 98, NT, 2000, XP etc.

• Internal backup/restore: Tally. ERP 9 has an in-built, user-friendly

‘backup and restore’ option. It helps the user to take a backup of one or more
companies or all companies, in a single directory, in the local hard disk, or in
any external media.

• Data reliability: Tally. ERP 9 offers reliable data. It uses a flexi-field,

flexi-length, self-indexed, weighted file structure for an extremely compact and
fast database. Tally. ERP 9 is robust. Tally. ERP 9 uses signaling quality data
integrity checks, at regular levels, to ensure the complete reliability of data.

• User-defined security levels: Tally. ERP 9 offers high levels of

security. Users can define multiple levels of security according to their
requirements. Every authorized user in the company can have an individual
password, with rights to use specific features only. The user with the
administrator level password will have full access and can set controls for
other users.

• Data security: Tally. ERP 9’s data integrity checks ensure that there are
no external changes to the data. Tally. ERP 9 also uses a binary encoding
format of storage to prevent devious grouping of information.

• Tally audit: The Tally. ERP 9 audit feature provides the user with
administrator rights and the capability to check the entries made by the
authorized users and alter these entries, if necessary. Once the entries are
audited, Tally. ERP 9 displays the altered entries, if any, along with the name of
the user, who has altered the entry, and the date and time of the alteration.

• Tally Vault: Tally. ERP 9 offers a data encryption option called Tally
Vault. Without the valid Tally Vault password, the data cannot be accessed.
Tally. ERP 9 follows the DES (Data Encryption Standard) encryption method to
safeguard the data.

• Removal of data into a separate company: Tally. ERP 9 allows

users to maintain a company for any number of financial years. Once the books
of accounts have been completed for the earlier financial years, the user can
split the company data into multiple companies as per financial periods
required. The user can specify the date from which the company has to be split
and Tally. ERP 9 will split the company to form two companies as per periods
specified. Once the data has been split, the closing balance of the first period
(first company) becomes the opening balance for the next period (second
company).

• Multi-directory for company management: The user can create

multiple directories to store data. The data stored in these directories can be
accessed directly in Tally. ERP 9, by specifying the path.

• Import/Export of data: Any transaction can be exported and

imported to other software after suitably altering the current structures to
accept the Tally. ERP 9 data structure. Data can also be imported to Tally. ERP
9 by writing a TDL program. The data which is to be exported from Tally. ERP 9
can be in XML, HTML or ASCII format.
• Data Synchronization: Synchronization is the process of exchanging
Tally. ERP 9 data between two or more locations. This process enables a
branch office to send its data to the head office, over the Internet or a private
network.

• Graphical analysis of data: Tally. ERP 9 provides graphical analysis of

data which helps the user to perform deeper analysis. The user can generate
graphical analysis reports such as Sales register, Purchase register, Ledgers,
Funds flow, Cash flow, Stock Item registers and so on. This helps the
management to quickly judge performance and be better prepared for difficult
times.

• ODBC (Open Database Connectivity) compliance: It allows other

programs to use data from Tally. ERP 9, directly. Thus, any program such as
MS-Excel or Oracle, which is ODBC compliant, can use data from Tally. ERP 9.
Data connectivity is dynamic, which means that any update in Tally. ERP 9 is
reflected in real time in other ODBC compliant software. The user can also
extract data from Tally. ERP 9 and design his/her own report formats in other
ODBC compliant software.

• Protocol support: Tally. ERP 9 provides protocol support for HTTP,

HTTPS, FTP, SMTP, ODBC and raw sockets with data interchange formats such
as XML, HTML with XML islands, SOAP and related formats. Protocol refers to a
mechanism by which information (data) can be put into or taken from Tally.
ERP 9. Formats refer to the standard for Information to be generated from
Tally. ERP 9 or from other applications which can exchange data with Tally. ERP
9.

• Direct web browser access: While working on Tally. ERP 9, the user
can directly log on to the Tally website, provided he/she has access to the
Internet. The website lists details of all the facilities offered by Tally. ERP 9. The
user can also download the latest release of Tally. ERP 9 as and when it is
available. The Tally website also offers Tally Chat, by which a user can
communicate with a Tally representative and get required information.
• Ability to preview and publish reports and documents on the
Internet: Companies which want to publish reports and price lists on their
website can do so directly from Tally. ERP 9.

• E-mail Facility: Tally. ERP 9 facilitates the mailing of any Tally. ERP 9
report or document.

• Multilingual capability: Tally is the world’s first accounting and

inventory software with multilingual capability. Currently, Tally. ERP 9’s
multilingual capability extends to 12 languages which include nine Indian
languages (Hindi, Gujarati, Punjabi, Tamil, Telugu, Marathi, Kannada,
Malayalam and Bengali), Arabic, Bahasa Melayu and Bahasa Indonesia. Tally.
ERP 9 enables you to enter data in one language and have it transliterated into
different languages. You can generate invoices, purchase orders or delivery
notes in the language of your choice after entering data for the same in any of
the nine specified languages. Also, the phonetic keyboard allows you to spell
the term phonetically based on how it sounds and Tally. ERP 9 displays the
data in the language selected after transliteration.

• Point of Sale (POS): POS is an acronym for Point of Sale. Point of Sale
can be a retail outlet, a checkout counter in a shop, or any other location
where a sales transaction takes place. It is a computerized cash register which
adds up the sales totals, calculates the balance to be returned to buyer and
automatically adjusts the inventory level to reflect the quantity sold. The
equipment required for POS to work effectively are cash registers, card
readers, barcode scanners and so on.
Getting Started with
Tally. ERP 9
Components of Tally Screen

Creating a company in Tally. ERP 9

The first step towards working with Tally. ERP 9 is to create a

‘company’. A ‘company’ in Tally. ERP 9 is a central repository
where you can maintain all the financial records of your
business, and from where you can extract the required
financial reports and statements.
The procedure to create a company is explained below. To
facilitate easier understanding, we have illustrated the
creation of a company named Pearl:
• Go to Gateway of Tally > Company Info. > Create
Company
The Company Creation screen appears as per Figure 1.1

The fields in the company creation screen and the information to be

filled in each of them are explained below. To navigate between the
fields, use the Enter/Tab/Arrow Keys, or Mouse clicks.
 Directory: The path to the location of Tally. ERP 9 data is displayed
here. By default, the path provided while installing Tally. ERP 9 will
be displayed. However, you can press backspace and specify the
location in which you want the data to be stored.
 Name: Provide a name for the company that is being created. In
this example, we are creating a company named Pearl Traders.
 Primary Mailing details: The mailing name and address details are
picked from here for any report such as balance sheet and
statements of accounts.
 Mailing Name: The name provided for the company in the name
field is automatically displayed here. However, you can change it as
per requirements. The name specified here will be used for mailing
purposes. In this example, Pearl Traders is retained.
 Fill in the company's address.
 Country: Select the country in which the company is located. This
will allow users to choose the statutory capabilities available for that
country. In this example, the country selected is India.
 Fill in the relevant numbers in the Telephone No. and Mobile No.
fields.
 E-Mail: Fill in the company's official e-mail ID here. This will be
used while e-mailing reports and statements from Tally. ERP 9

Books and Financial Year Details:

 Financial Year from: This refers to the twelve-month accounting
period of the company. For Pearl Traders, the financial year begins
on 1-7-2016.
 Books beginning from: The date provided in the aforesaid field will
be automatically displayed here. In the example, the date is retained.
However, if you have started with maintaining your books of
accounts with Tally. ERP 9 mid-year, the required date can be set
accordingly. Tally will not allow you to record the transactions for
dates preceding the date entered in the books beginning from field.

Security Control:
 Tally Vault Password (if any): Once you enter a password here, you
will need it to open your company each time. The name of a
company that is locked using Tally Vault will be hidden with the
asterisk 'symbol'. You need to provide the Tally Vault password to
open and access the company.
 Repeat Password: Here, enter the password entered in the Tally
Vault field, as a confirmation.
 Use Security Control: Setting this option to Yes will allow you to
define the access rights for each user who will access your company.
This feature is explained in forthcoming chapters.

Base Currency Information:

 Base Currency Symbol: The base currency symbol will be filled as
per the country selected.
 Formal Name: The currency's formal name will be filled here. In
this example, it is INR (Indian Rupees).
 Suffix Symbol to Amount: For some countries, the currency symbol
is specified after the amount. This option can be enabled for such
countries, so that the currency symbol may be printed after the
amount. However, Pearl Traders is an Indian company and hence this
option is set to No.
 Add Space between Amount and Symbol: Tally. ERP 9 will provide a
single space between the amount and the currency symbol, if this
option is set to Yes. For e.g.: KSh 5,000. Notice the space between
symbol and the amount.
 Show amounts in Millions: If the company's financial statements
need to have their values expressed
 Number of Decimal Places: By default, the number of decimal
places for the base currency is set to 2. However, you can have up to
4 decimal places. The Indian currency has 2 decimal places whereas
certain other countries require 3 decimal places and so on.
 Word representing amount after decimal: The symbol for amounts
expressed in decimals will be set by default. For India, it is Paise.
 Decimal Places for printing amounts in Words: You can specify the
number of decimal places for printing the amount in words. This
number should be equal to or lesser than the number specified in
number of decimal Places field. For example, if the currency has up
to 3 decimal places, the value to be printed in words can be
restricted to 2 decimal places.
Note: -
Base currency information is set to the default based on the
country selected.

The Completed Company Creation screen appears as per Figure 1.2

The message Accept? Yes or No will be displayed.

Press Yes or Enter to save the details.

Select a Company
By ‘selecting’ a company, you are essentially opening the company it in Tally.
ERP 9.
1. Go to Gateway of Tally > F3: Company Info. (Alt+F3) Fig.1.3

2. Click Select Company, or press S. Tally. ERP 9 displays the Select Company
screen, with a List of Companies that are available in the location specified.
You can also press F1 to get to the Select Company screen.Fig.1.4
Shut a Company
By ‘shutting’ a company, you are essentially closing a company.
Go to Gateway of Tally > F3: Company Info. (Alt+F3)
Click Shut Company. Tally. ERP 9 displays the Close Company screen, with the
List of Companies that are open. You can also use Alt+F1 from the Gateway of
Tally to get to this screen.Fig.1.5
Alter Company Details
By ‘altering’ a company, you are modifying the details which you have
provided in the Company Creation screen.
Go to Gateway of Tally > F3: Company Info. (Alt+F3)
1. Click Alter or press A. Tally. ERP 9 displays the Select Item screen, with a
List of Companies that are available in the location specified. Select the
company which you need to alter and press Enter to view the Company
Alteration screen. Alter the company details as required and accept the
screen.Fig.1.6
Introduction to Tally. ERP 9
Features and Configurations
 Introduction:
The ‘Features’ in Tally. ERP 9 are a set of capabilities, provided as options, that
enable you to maintain financial records as per your business needs. The
company features menu can be found by clicking F11: Features on the vertical
button bar. The effect of these options will be reflected only in the company
for which they are enabled.

The ‘Configurations’ in Tally. ERP 9 are options that help you modify the way a
feature works. The configuration menu can be found by clicking F12: Configure
on the vertical button bar. The options when enabled, will have an effect on all
the companies in the data directory.

Once you have created a company in Tally. ERP 9, the next step would be to
setup Tally. ERP 9’s ‘Features’ and ‘Configurations’.

There are sets of options that help you optimize your usage of Tally. ERP 9.

Features:
The Company Features section in Tally. ERP 9 is divided into the following
major categories:

 Accounting Features

 Inventory Features

 Statutory & Taxation

 TSS Features

 Add-On Features
You can press F11: Features from any screen of Tally. ERP 9 or you may also
click the F11: Features button available in the vertical button bar, to enable the
required features. The features are specific only to the company currently in
use (for which the said feature is enabled), thereby allowing flexibility of
independently enabling different features for each of the companies.

Load the company by name Pearl Traders and go to Gateway of Tally > press
F11: Company Features

The Company Features Screen appears as per Figure 1.7

• Accounting Features
The Accounting Features consists of configurations/functionalities, which
generally affect accounting transactions and reports.
The Accounting features section is further divided into six sub-sections,
namely:
 General
 Outstanding Management
 Cost/Profit Centers Management
 Invoicing
 Budgets and Scenario Management
 Banking Features
 Other Feature
Go to Gateway of Tally > F11: Company Features > Accounting Features or
click F1: Accounting Features
The Accounting Features Screen appears as per Figure 1.8
 Enable the required features
 Press Enter to accept

• Inventory Features
The Inventory features comprise of configurations/functionalities pertaining to
inventory transactions and reports.
The Inventory features section is further divided into seven sub-sections,
namely:
 General

 Storage & Classification

 Order Processing

 Invoicing

 Purchase Management

 Sales Management

 Other Features
Go to Gateway of Tally > F11: Company Features > Inventory Features or click
F2: Inventory.

• Statutory & Taxation Features

The Statutory & Taxation features comprise of configurations / functionalities
pertaining to statutory compliances available in Tally. ERP 9. The Statutory
features are country specific and strictly depend upon the country selected in
the Company Creation screen.

• TSS Features
The Tally Software Services (TSS) screen comprises information about
Connection, Remote Access and SMS Access details of a company. The TSS
Features will be available only when Use Security Control is set to Yes in
Company Creation screen.

Go to Gateway of Tally > F11: Company Features > TSS Features or click F4: TSS

• Add-On Features

Customers, to meet their accounting requirements, may purchase customized

solutions from Tally Partners.

Depending on the customer requirement, the solution provider formulates the

solution. In some cases, a solution

may require the introduction of a new feature in Tally. ERP 9 to support the
functionality. F6: Add-On Features is a

place holder for the features provided in the Add-ons/Local TDLs loaded.

Go to Gateway of Tally > F11: Company Features > F6: Add-On Features

• Data Management and Security Features

The data management and security features comprises of
configurations/functionalities pertaining to:

 Taking backup of a company

 Restoring the backup of a company

 Splitting a company

 Exporting and importing data using Tally. ERP 9

 E-Mailing

 Data Security

• Payroll Features
Tally. ERP 9 integrates payroll features with accounting features, and simplifies
payroll processing. Tally. ERP 9 enables users to set up and implement salary
structures, ranging from simple to complex, as per the organization’s
requirements. Users can also align and automate payroll processes and
integrate the same with other accounting applications. Tally. ERP 9 also
supports pay slip printing, recording of attendance, leave, and overtime. Users
can also generate gratuity and expat reports.
 Configurations

In Tally. ERP 9, F12: Configurations are provided for Accounting, Inventory &
printing options and are user definable as per the business’ requirements. The
F12: Configurations are applicable to all the companies residing in the Tally.
ERP 9 data Directory. The F12: Configuration options vary depending upon the
context, i.e., if you press F12: Configure from voucher entry screen, the
respective F12: Configurations screen is displayed.

Go to Gateway of Tally > F12: Configure.

 Maintaining Chart of
Accounts in Tally. ERP 9
Introduction

A ‘Chart of Accounts’ is a list that depicts the accounts that a business uses to
record transactions in its books of accounts. Tally. ERP 9 will put together your
business’ chart of accounts based on the ‘Ledgers’ and ‘Groups’ that you
identify.

Ledgers and Groups

Ledgers
A ‘Ledger’ is an account head. For instance, the sales account head will be
called a ‘Sales Ledger’ in Tally. ERP 9. Similarly, a customer would be an
account head, and will be called a ‘party ledger’. You can create ledgers
specific to your business transactions. For a newly created company, there are
two pre-defined ledgers available in Tally. ERP 9: Cash Profit & Loss A/c to
view the list of ledgers, go to Gateway of Tally > Accounts Info. > Ledgers >
Display (Multiple Ledgers) > Select All Items.
The Multi Ledger Display Screen appears as per Figure 1.6
 Groups

A ‘Group’ is the accounting group under which ledgers of the same nature can
be classified. For instance, Tally. ERP 9 has a default Group ‘Sales Accounts’,
under which all the sales ledgers will be classified.
There are 28 pre-defined groups in Tally. ERP 9, which feature in the chart of
accounts of many organizations. Out of these, 15 groups are primary groups
and the remaining 13 are sub-groups.
Among the 15 primary groups, 9 groups are balance sheet items and the
remaining 6 groups are Profit & Loss A/c items. You can use these groups to
build your chart of accounts, as well as create and used group’s specific to your
business transactions.
Maintaining Chart of Accounts in Tally. ERP 9 However, you may also alter the
nomenclature of these 28 groups.
To view the list of the 28 groups, known as the List of Accounts, go to Gateway
of Tally > Accounts Info. > Groups > Display (Multiple Groups) > Select All
Items. The Multi Group Display Screen appears as per Figure 1.12
Out of the 15 Primary groups, the following appear in the Profit & Loss
Account:
1. Sales Accounts
2. Purchase Accounts
3. Direct Incomes or Income (Direct)
4. Indirect Incomes or Income (Indirect)
5. Direct Expenses or Expenses (Direct)
6. Indirect Expenses or Expenses (Indirect)

Ledger Creation

In Tally. ERP 9, we can create the ledgers in two ways given below:
I. Single Ledger Creation: Here we can create one ledger at a time.
II. Multiple Ledger Creation: Here we can create different ledgers at one go and
also ledgers which belong to
particular group.

I. Single Ledger Creation

Creation of Proprietor’s Capital Account ledger from single ledger creation
screen.
1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create (Single Ledger
Creation)
2. Enter Name as Proprietor’s Capital Account
3. Select Capital Account from the List of Groups
The Ledger Creation Screen appears as per Figure 1.13
4. Press Y or Enter to accept the screen
Tally. ERP 9 displays the total debit and credit opening balances in the right
upper corner of screen while the ledgers are being created in the ledger
creation screen. This is to avoid differences in the opening balance.

II. Multiple Ledger Creation

Now let us create the following ledgers using the Multi Ledger Creation option:
To create Multiple Ledgers at once, follow the below given steps:
1. Go to Gateway of Tally > Accounts Info > Ledgers > Multiple ledgers > Create
2. From Under Group field select All Items.
Notes:
If you select Purchase Account in the ‘Under Group’ field, then the ledger will
be created under Purchase Account Head.
3. Under Name of Ledger enter the name as Kaltronic Ltd.
4. Select as Sundry Creditors from the List of Groups
5. Press Enter and move to next line as there is no opening balance
6. Similarly, select the other ledgers as shown in figure 1.14

7. Press Enter or Y to Accept.

Now that we have learnt how to create ledgers under Tally. ERP 9’s default
pre-defined groups, let us move on to understand how to make alterations to
ledgers that are already created.

Altering and Displaying Ledgers

Now, go to Gateway of Tally >Accounts Info>Ledgers > Select Display under
single ledger, you will see that the List of Ledgers.
You can also Alter ledgers from Accounts Info. > Ledgers > Alter (Multiple
Ledgers).

Deleting Ledgers
You can delete a ledger, by pressing Alt+D in the Ledger Alteration screen. You
will not be able to delete a ledger, once the financial transactions (vouchers)
have been entered (excluding the Opening Balance). If there is a need to delete
a ledger with any financial transactions, all the transactions must be deleted
first by pressing Alt+D.
Group Creation
In Tally. ERP 9, there are 28 predefined groups, this mean that it is not
necessary to create the Account Group in Tally. ERP 9. However, considering
the different requirement of an organization and its nature, Tally. ERP 9 has
also provided flexibility to create the account group, if need be.
Group creation is similar to ledger creation in Tally. ERP 9. As with ledgers,
there are two ways of creating groups:
I. Single Group Creation: Involves creation of a single group at a time
II. Multiple Group Creation: Involves creation of multiple groups at a time
Single Group Creation.
The group to be created, and the primary group under which it has to be
classified, is specified in the table below:
Group to be created Classification
Debtors - North Sundry Debtors
To create the group,
1. Go to Gateway of Tally > Accounts Info. > Groups > Create (Single Group)
2. Enter Name as Debtors - North
3. Against the field Under select Sundry Debtors from the List of Groups
The Group Creation Screen appears as per Figure 1.14
Note: To create a Multi Group in Tally.ERP 9, go to Gateway of Tally >.
Accounts Info > Groups > Under Multiple Groups > Select Create.

Accounting Vouchers
 Introduction

In accounting terms, a voucher is a document containing the details of a

financial transaction. For example, a purchase invoice, a sales receipt, a petty
cash docket, a bank interest statement, and so on. For every such transaction
made, a voucher is used to enter the details into the ledgers to update the
financial position of the company. This feature of Tally. ERP 9 will be used most
often. Tally. ERP 9 follows the Golden Rules of Accounting:

Types of Accounts Rules for Debit Rules for Credit

Personal Account Debit the Receiver Credit the Giver
Real Account Debit what comes In Credit what goes Out
Nominal Account Debit all Expenses and Credit all Incomes
Losses &Gains
A voucher entry screen in Tally. ERP 9 comprises of the following sections:

Type of Voucher

It is essential to check if you are using the right voucher for the transaction.
You can change the voucher type by selecting a new type from the button bar,
if required. For example, on the selection of a payment voucher, Tally. ERP 9
automatically displays the list of voucher types you have created. You can
select the voucher type required.

Voucher Number

Tally. ERP 9 automatically sets the voucher number for you. You can change
the voucher number manually, if required.

Reference

You can enter a reference of your choice. A purchase order number or an

invoice number can be entered as a reference.

Date of Voucher

The date of the voucher you enter is displayed at the top-right of the voucher
creation screen. The date is taken initially from the Gateway of Tally - Current
Date and you may need to change it frequently to ensure that the vouchers are
dated as you want.

Effective Date

A voucher type can be configured to allow for an effective date. The line below
the date of voucher displays the date when the voucher will be effective. This
will be available only if the effective date option is activated in the particular
voucher type.

Particulars

This is where you enter the ledger names and the debit and credit amounts.
Each line displays a prompt of Dr or By for debit entries and Cr or To for credit
entries. Depending on the voucher type, Tally. ERP 9 selects either ‘Dr’ or ‘Cr’
for the first prompt, which you cannot change. Thereafter, you can change the
prompt (if necessary) by typing over it with a ‘D’ or a ‘C’. To select a ledger,
type the first letter of its name. Tally. ERP 9 then displays a List of ledger
accounts beginning with the letter highlighted. Only ledgers suitable for the
voucher type are displayed. The revised current balance is shown after the
amount is entered. On selecting the next ledger, Tally. ERP 9 suggests the
balancing amount as the value to be entered, which may be accepted or typed
over. The voucher entry cannot be completed until the debits equal the
credits.

Narration

Here you type whatever appropriately describes the transaction. Remember,

you can have a separate narration for each line of particulars, if you configure
the voucher type in that way.

Once the narration is complete, press Enter to bring up the Accept? The box.
Once you accept the data, Tally. ERP 9 presents another voucher entry screen.

Accounting Vouchers

Tally. ERP 9 is pre-programmed with a variety of accounting vouchers, each

designed to perform a different job. The standard accounting vouchers are of 8
types. Let us understand how to record accounting transactions in Tally. ERP 9,
with examples from the books of accounts of Pearl:
• Contra Voucher (F4)
A contra voucher is a set/group of two or more vouchers to record
transactions within the Establishment specially to record transactions for Cash
to Bank or Withdrawal from Bank or at the time of Reconciliation to Account
the various Bank related Charges.

Payment Voucher (F5)

A payment voucher is a way to record payments made to suppliers and maintain
a history of payments that your business has made. Companies use vouchers to
gather and file supporting documents that are required to approve and track
payments of liabilities. Vouchers are used by accounts payable (short-term bills
owed by companies to suppliers), invoicing and payroll.
 • Receipt Voucher (F6)
A receipt voucher is a type of voucher which is typically issued by a certain
business or an organization upon receiving payment in cash or check during a
business transaction. In some cases, a receipt voucher is used as an alternative
of printable receipts.

• Journal Voucher (F7)

Journal Voucher is the supporting document that supports transactions record in
the financial statement. It is mostly used for the adjusting and reversing entry.
Each transaction must be supported by a hard copy as the summary of
transaction. This hard copy can be a payment voucher, receipt voucher, journal
voucher, and so on.

• Sales Voucher/Invoice (F8)

A sales voucher is a record of a sales transaction. Historically, the sales voucher
was often a carbon copy of the sales invoice given to a customer. When the
customer didn't receive a written record, the sales voucher was the original
invoice
 • Credit Note Voucher (Ctrl+F8)
A credit note is a financial document that sellers provide to buyers as a token of
confirmation against registered returns. It acknowledges the cancellation and
lets the sellers make a credit entry to the buyers’ account for the required
amount. Besides, it records the returned goods as return inwards for further
processing or adjustment of the balance.
 • Purchase Voucher (F9)
When the goods are purchased on credit for resale or to use in production etc.,
then only purchase voucher is prepared. While preparing the purchase voucher,
the purchase or goods account is debited and supplier’s account is credited with
the value of purchase amount.

• Debit Note Voucher (Ctrl+F9)

Debit Note is a document/voucher given by a party to other party stating that
such other party’s account is debited in the books of sender. It is a simple
accounting entry in which the person to whom debit note is to be issued is
debited and the account due to which it is issued is credited.
You can alter these vouchers to suit your company, and also create new
ones.

Daybook
The Day Book lists all transactions made in a particular day and by
default displays the last voucher entry date of a regular voucher. It
could also be set up to list all the transactions made over a certain
period. Transactions include all financial vouchers, reversing and
memorandum journals as well as inventory voucher.
1. Gateway of Tally > Day Book.
Alternatively, Alt+G (Go To) > type or select Day Book > press
Enter.
Press Alt+F1 (Detailed) for a detailed format of the report.
 Range
1. Day Book > Alt+F12 (Range).

2. Select Voucher in the Type of Information field.

3. Select reference in the having field.
4. Select greater than in the Range of Information field.
5. Enter ‘10000’ in the last field, if you think that you might have
transactions above than 10000.
6. Press Enter to continue.
 UNIT 3

BANK RECONCILIATION STATEMENT

Bank reconciliation is a process that explains the difference between the bank balance shown
in an organization's bank statement, as supplied by the bank, and the corresponding amount
shown in the organization's own [accounting] records at a particular point of time.
Reconciling the company's bank books with the banker's statement is a regular task of
accounting.
 From the screen of Gateway of Tally select Display and then choose Account Books.
 Open the Bank Account and click on Reconcile.
 Add the bank date to reconcile by pressing F5-Reconcile.
Assignment on Bank Reconciliation Statement:

Cash/Bank Summary AKSHAY RANA BRS ctrl

+m

Ledger Monthly AKSHAY RANA BRS

ctrl +m
1-APR-2023
Bank Reconciliation AKSHAY RANA BRS ctrl +m

1-APR-2023
 EXPORT AND IMPORT
Export
This option is used to send data from one company to other company in tally or send tally
data to other software (ex- MS-word, MS-excel etc.). You have to export the masters first and
then the transactions.
Ensure that F11: Features of the exporting and the importing company are the same.
You can export masters created in a company, in different formats.
1. ASCII delimited
2. JPEG
3. PDF
4. Excel
5. XML
6. HTML
You can also choose the type of masters to export. Masters exported in XML format can be
imported into Tally.ERP9 using the Import Masters option.
1. Go to Gateway of Tally > Display > List of Accounts.
2. Click E: Export.
3. Press backspace to configure the export options.
● Select the Language.
● Select the Format.
● Enter the Export Location.
● Enter the Output File Name.
● Select the Type of Masters to be exported.
● Set the option Include dependent masters? to Yes.
4. Enable Export Closing Balances as Opening
5. Press Enter to export.

Gateway of Tally ctrl +m

Current Period Current Date

1-4-2023to 31-3-2024 1-apr-2023

List of Accounts AKSHAY BRS ctrl +M

List of Ledgers 1-APR-2023

Exports Reports AKSHAY BRS ctrl +M

1-APR-2023
AS ASCII FORMAT
AS EXCEL FORMAT

[email protected]
AS HTML FORMAT

For 1-APR-2023

AS JPEG IMAGE
 AKSHAY RANA BRS

Shahdara

AS PDF FORMAT
AKSHAY RANA BRS
Shahdara

For 1-Apr-2023
AS XML FORMAT
Meaning of Import
The only format supported for importing the data in Tally ERP9 is XML.

Understanding how to Import Masters

The company features that were enabled while exporting the data should be enabled in the
company in which the data is imported.
1. Go to Gateway of Tally > Import Data > Masters.
2. Enter the name of the .xml file to be imported, if the file is located in the Tally.ERP 9
application folder.
3. Select the behaviour to define the method by which the existing masters in the
company will be treated.
Combine Opening Balances: Select this option to import data of different branches
and consolidate the opening balances. You can also select this option when the
opening balances of existing masters are Zero and need to be overwritten by the
balances in the data being imported.
Ignore Duplicates: Select this option to import new masters along with the existing
masters in Tally ignoring the duplicates.
Modify with new data: Select this option to replace the existing balances with those
existing in the data imported and also override the other options available in list of
behaviours available. The Import Masters screen appears as shown below:
4. Press Enter to import.
Go to Accounts Info or Inventory Info to view all the masters that has been imported. You
can also open the file Tally.imp located in the Tally.ERP 9 installation folder to view the
import log.
1-4-2023 to 31-3-2024 1-apr-2023

AKSHAY RANA BRS 1-APR-2023

Import Data AKSHAY BRS ctrl +M

List of Accounts AKSHAY BRS ctrl +M

List of Ledgers
 INVENTORY MANAGEMENT IN TALLY.ERP 9
Inventory management is one of the key factors which will define the success of the business.
Inventory is money sitting around in another form and it holds huge working capital.
Inventory management can be defined as a whole lot of activities done to maintain an optimum
number of inventories to ensure uninterrupted production, sales, high customer satisfaction, reduced
inventory handling cost and so on.
In simple words, inventory management is all about striking the balance between
overstocking and understocking. Overstocking will lead to cash flow blockage and additional
cost for managing excess stock. On the flip side, understocking leads to loss of sale due to
non-availability of stock at the right time.
Thus, it is all about maintaining the right level inventories at the right time and keeping the
inventory handling cost at low.

INVENTORY INFORMATION
The Inventory Information menu lists the inventory masters like Stock Group, Stock Items,
Units of Measure of the company, using which you can create, alter, and display the
inventory master details.

By using F11: Features, you can enable the various settings under inventory features
which determine the information to be entered during transaction entries.
By using F12: Configure, you can enable the required settings of Inventory Masters.

By default, the settings pertaining to Inventory Masters are set to No. If you set them to Yes,
the features will be enabled. Typically, they are additional fields that appear during master’s
creation which enable you to obtain more information and detailed analyses.
The inventory system operates in much the same way as the accounting system. In the place
of accounting groups, ‘Stock Groups’ and ‘Stock Categories’ are used, and in the place of
ledgers, ‘Stock Items’ are used.

Assignment referred for Inventory Info.

STOCK GROUP
A Stock Group is similar to the groups we create for accounting. Stock Items of similar
nature, brand, etc. can be classified under a single stock group. In the example above, the
stock group for ‘Television’ can be the brand, like ‘Sony’, ‘Videocon’, ‘Philips’, etc.
 Go to Gateway of Tally > Inventory Info. > Stock Groups > Create (under the Single
Stock Group)
 1-4-2023 to 31-3-2024 1-apr-2023

AKSHAY INVENTORY
DISPLAYING STOCK GROUP
 Go to Gateway of Tally > Inventory Info. > Stock Groups > Display.

Multi Stock Group Display AKSHAY INVENTORY ctrl +M

Under Group : All Items

STOCK CATEGORIES
The advantage of Categorizing items is that you can classify the stock items (based on
functionality) together – across different stock groups which enable you to obtain reports on
alternatives or substitutes for a stock item.
For enabling Stock Category option in the Inventory Info menu, press F11 > Inventory
Features > Set Yes for Maintain stock categories.

 Go to Gateway of Tally > Inventory Info. > Stock Categories> Create (under the
Single Stock Category)
STOCK CATEGORY DISPLAY
 Go to Gateway of Tally > Inventory Info. > Stock Category> Display.

Multi Stock Group Display AKSHAY INVENTORY ctrl +M

Under Group : All Items
UNITS OF MEASURE
Stock items are purchased and sold on the basis of quantity. The quantity in turn is measured
in units. In Tally. ERP 9, such goods are quantified using ‘Units of Measurement’. Units of
Measure can be ‘simple’ or ‘compound’. Examples of simple units of measure are: numbers,
metres, kilograms, pieces, etc. Examples for compound units of measure are: a box of 10
pieces, etc.
 Go to Gateway of Tally > Inventory Info. > Units of Measure > Create
 Enter the required details and click on Accept.
GODOWNS
A place where stock items are stored is referred to as a “Godown”. For example, a
warehouse. You can obtain stock reports for each Godown and account for the movement of
stock between Godowns (Store houses).
Activate Godown
 To activate Godown Feature, Go to Gateway of Tally > Press F11 > Company
Features > F2: Inventory Features.
 Set the option Maintain Multiple Godown to Yes.
Creation of Godown
 Go to Gateway of Tally > Inventory Info. >Locations> Create
GODOWN DISPLAY
 Go to Gateway of Tally > Inventory Info. >Godown> Display (Multiple)

Multi Location Alteration AKSHAY INVENTORY ctrl +M

Under Group : All Items
STOCK ITEM
A Stock Item is a unit of the goods that a business trades in.It is the primary inventory entity
and is the lowest level of information on your inventory. You must create a Stock Item in
Tally.ERP 9 for each inventory item that you want to account for.
Create stock items
Stock items are goods that you manufacture or trade (sell and purchase). It is the
primary inventory entity. Stock Items in the Inventory transactions are like ledgers being
used in accounting transactions.
 Go to Gateway of Tally > Inventory Info. > Stock Items > Create
 Enter the required details and click on Accept. List of Accounts
AKSHAY BRS ctrl +M

1-4-2023 to 31-3-2024 1-Apr-2023

AKSHAY INVENTORY
STOCK ITEM DISPLAY
 Go to Gateway of Tally > Inventory Info. >Stock Items > Display (Multiple)
 INVENTORY AND ORDER VOUCHER
QUESTION
1. Received a Sales Order from Sohan of HP Laserjet Printer 5 No. to be delivered
on 2/05/2022 at a sale price of Rs.10000 per No.

a. Make an Inventory Voucher named ‘Sales Order’.

Order Voucher Creation AKSHAY INVENTORY ctrl +M

1-Apr-2023

b. Make ‘Delivery Note’

Inventory Voucher Alteration (Secondary) AKSHAY INVENTORY ctrl +M

1-Apr-2023

c. Then Prepare a simple ‘Sales Voucher’.

 Accounting Voucher Creation AKSHAY INVENTORY ctrl +M

1-Apr-2023

2. Gave an order to purchase Samsung Laserjet Series Printers 5 No. from Mohan to
be delivered on 2/05/2022 at a purchase price of Rs.12000 per No. One Samsung
Laserjet Printer returned to Mohan on 3/05/2022 on account of defect. Bill was
not sent to Mohan with the Delivery of Goods. It was sent on 5/05/2022.

a. Make a ‘Purchase Order’ Voucher.

Order Voucher Creation AKSHAY INVENTORY ctrl +M

Purchase Order NO:1

1-Apr-2023

b. Make a ‘Receipt Note’ to show that goods are received.

c. Then, Prepare a ‘Purchase Voucher’.
d. For returning a defective Samsung Laserjet, Pass a ‘Rejection Out’ Voucher.
3. Received an order from Rahul to supply him HCL PC 1 to be delivered on
3/05/2022. Sales bill shared on Delivery.

a. Prepare a ‘Sales Order’ Voucher.

b. Then make a ‘Delivery note’ to show the delivery of goods.
 c. Then make a ‘Sales’ Voucher to record sales of goods.

1-Apr-2023

4. Sohan returned one HP Laserjet Printer on 3/05/2022.

 a. Prepare a ‘Rejection In’ Voucher under Order Voucher.

Inventory Voucher Creation AKSHAY INVENTORY ctrl +M

Rejections In NO:1 1-Apr-2023

Order Voucher Creation AKSHAY INVENTORY ctrl +M

5. 2 Samsung Printers transferred from On site to Warehouse.

a. To transfer goods from one location to other, a ‘Stock Journal’ Voucher

should be prepared.
 Inventory Voucher Creation AKSHAY INVENTORY ctrl +M

Stock Journal NO:1 1-Apr-2023

6. Physical Stock Calculation revealed IBM PCs No. as 5 instead of 4.

Prepare a ‘Physical Stock’ Voucher to correct the no. of goods at a particular

Location.

Inventory Voucher Creation AKSHAY INVENTORY ctrl +M

Physical Stock NO:1 1-Apr-2023

 STOCK SUMMARY
Stock Summary is a statement of stock in hand on a particular date. The statement gets
updated with every transaction to provide stock position at any given time. Tally.ERP 9 treats
stock summary as one of the primary statements and makes it accessible directly from the
Gateway of Tally.
Similar to other Tally.ERP 9 reports, Stock Summary can also be drilled down and
configured to view various inventory information including inflow and outflow of stock.

To view the Stock Summary,

 Go to Gateway of Tally > Stock Summary
 By default, Stock Group balances are displayed
 Press Alt+F1 for detailed view

AKSHAY Inventory
For 1-Apr-2023

BILL OF MATERIALS
• Bill of Material is a comprehensive list of raw materials, components, assemblies,
sub-assemblies, parts, or anything which is required to manufacture the finished
product. The finished product or goods may be the final product itself or a semi-
finished product which is later consumed to produce a final or a larger product.
• The bill of material for finished goods not only lists the components but also the
quantity of each component required to produce the finished goods. If the finished
product has a variant by color, configuration, size etc., you can choose to have
multiple BOM for a single product.
• Bill of Material (BoM) is created only for those items that are being assembled in-
house. Therefore, you need to specify a BoM at the time of creating a Stock Item or
while altering the stock item. For trading items, you do not need a BoM.
Single BOM can be created for a stock item where you use standard set of inputs to
manufacture finished goods.
• Multiple BOM can be created for a stock items where you use varying set of components
to manufacture a specific finished goods based on the availability of goods or customer
requirements.
• The facility to create Multiple Bill of Materials for Stock Item has been provided in
Tally.ERP 9 Release 3.0. Where you can create multiple BOM with different component
list for a stock item & appropriate BOM can be selected in the manufacturing Voucher.
• This feature will be useful where you are using different components to manufacture the
same stock item based on the customer requirement.

SETTING UP BILL OF MATERIALS

• Go to Gateway of Tally > F12: Configure > select Accts/Inventory Info.
• Set Enable component list details (Bill of Materials)? to Yes.

Master Configuration AKSHAY Bills of Materials ctrl +M

OR
• Go to Gateway of Tally > Inventory Info > Stock Items > Create.
• Press F12: Configure (Stock Item Configuration) and set Enable component list
details (Bill of Materials)? to Yes.
 Master Configuration AKSHAY Bills of Materials ctrl +M

BILL OF MATERIALS EXERCISE

Create Bill of Materials to create a finished product Television using the following
components.
Auto Amplifier-20 @ Rs 2000-1
PCB Main Board-20 @ Rs 5000-1
Picture Tube-20 @ Rs 6000-1
Stereo Speaker-20 @ 7000-2
TV Tuner Board-20 @ Rs 10000-1
The above stock items have been procured from supplier Ram & Sons.
Create a manufacturing journal to show production of 2 Nos of Television.

a. Prepare Stock Items according to Questions.

b. Prepare a ‘Purchase Order’ Voucher.

1-Apr-2023

c. Then to show that the goods are received, Make a receipt note.
Inventory Voucher Creation AKSHAY Bills of Materials ctrl +M

NO:1 Receipt Note

Reference No: 1
1-Apr-2023

d. To show the purchase, ‘Purchase’ Voucher will be created.

e. Then Make a Voucher type called ‘Manufacturing Voucher’ and fill it to show the
manufacturing of ‘Television’ using other Stock Items which are purchased.
 Inventory Voucher Creation AKSHAY Bills of Materials ctrl +M

Manufacturing voucher NO:1 1-Apr-2023

Ratio Analysis

Ratios are a set of figures compared with another set. The comparison gives an understanding
of the financial position of a business unit. There are a number of ratios which can be
computed from a single set of financial statements. The ratios to be computed depend on the
purpose for which these ratios are required. A single ratio may sometimes give some
information, but to make a comprehensive analysis, a set of inter-related ratios are required to
be analyzed.
The Ratio Analysis Report is divided into two parts, Principal Groups and Principal Ratios.
The Principal Groups are the key figures that give perspective to the ratios. Principal Ratios
relate two pieces of financial data to obtain a comparison that is meaningful.
● Go to Gateway of Tally > Ratio Analysis . The Ratio Analysis screen is displayed as shown
below:
 Ratio Analysis AKSHAY Inventory ctrl
+M

For 1-Apr-2023 For 1-Apr-2023

Trial Balance

A trial balance is a summary of all ledger balances, and helps in checking whether the
transactions are correct and balanced.
If journal entries are error-free and posted correctly to the general ledger, the total of all debit
balances should be equal the total of all credit balances.
Note : By default, the Trial Balance report will be generated as on the date of the last voucher
entry. You can change the date to view the report for the required period.
 Go to Gateway of Tally > Display > Trial Balance . The Detailed Trial
Balance appears as shown below:
 Trial Balance AKSHAY Inventory ctrl +M

For 1-Apr-2023

 A Ledger wise detailed Trial Balance will appear as below:

Trial Balance AKSHAY Inventory ctrl +M

For 1-Apr-2023

Balance Sheet

A balance sheet is a financial statement that reports a company's financial position. This
report shows the balance between the assets and liabilities of a firm. The balance sheet
follows the fundamental accounting equation: Assets = Liabilities + Owner's Equity.
Note: By default, the Balance Sheet report will be generated as on the date of the last
voucher entry. You can change the date to view the report for the required period.
View the Balance Sheet
 Go to Gateway of Tally > Display > Balance Sheet.
Detailed Balance Sheet will appear as below:

Balance Sheet AKSHAY Inventory Ctrl + M

For 1-Apr-2023 For 1-Apr-2023

Detailed Balance Sheet as per Schedule VI, press Alt+S

AKSHAY Inventory

For 1-Apr-2023

Cash Flow Summary

Cash Flow is the inflow and outflow of cash during an accounting period.
A cash flow statement concentrates on the transactions that have a direct impact on cash. It
deals with the inflow and outflow of cash between two Balance Sheet dates. That is, it
explains the changes in cash position between the two periods. Here the term cash stands for
cash and bank balances.
Cash flow statements can also be used as receipts and payments statement. This is
particularly useful for businesses such as Non-Profit Organizations where receipts and
payments statements need to be generated.
 Go to Gateway of Tally > Display > Cash/Funds Flow > Cash Flow.
 Press Alt+f1 to see detailed Cash Flow Summary.
Detailed Cash Flow Summary will be appeared as below:

For 1-Apr-2023 to Mar 23 AKSHAY Traders

1-Apr-2023 to 30 Apr-2024 1-Apr-2023 to 30 Apr-2024

Funds Flow Summary

A Fund Flow statement is a report, which explains the movement of funds during an
accounting period.
This statement consists of two parts
● Sources of funds
● Application of funds
The difference between the two shows the net change in the working capital during
the period. Only those transactions that affect the net working capital of the firm, find
place in this statement.
The Fund Flow statement is a supplement to the two principal financial statements.
While supplementing the position statement, it describes the sources from which
 additional fund were derived and for which these funds were used. The transactions,
which increase working capital, are sources of funds and the transactions, which
decrease working capital, are application of funds.

To view Funds Flow

 Go to Gateway of Tally > Display > Cash/Funds Flow > Funds Flow.
 Press Alt+F1 for detailed Fund Flow Summary.
 Detailed Fund Flow Summary will appear as below:

AKSHAY Traders
1-Apr-2023 to 30 Apr-2024 1-Apr-2023 to 30 Apr-2024