What is Tally?

Tally is an accounting software developed by Tally Solution Limited

Company. Which is used to record and keep the financial transactions
of a company, trust or financial transaction institution from computer.
So that the financial status of the business will be known.
Full form of Tally –
Transactions Allowed in a Linear Line Yard

What are the different versions of Tally?

Tally 3.0 (1990) – Tally 3.0 is the first version of Tally. Which has been
used for basic accounting requirements of small businesses. However,
external and special commands are required to run the software. And
it only supports Microsoft DOS.
Tally 3.12 (1991)
Tally 4 (1992)
Tally 4.5 (1994)
Tally 5.4 (1996)
Tally 6.3 (2001)
Tally 7.2 (2005)
Tally 8.1 (2006)
Tally 9 (2006)
10.Tally ERP 9 (2009) – Tally erp9 notes english
Tally ERP 9 is the latest version of Tally since 2009. It is being used by
the trade organization. It has advanced features including GST
computation, invoicing and payroll processing, remote access, multi-
user login and transaction processes. Nowadays businessmen want a
complete business solution software like Tally.
11. Tally Prime (2020) – Tally erp9 notes english
This is the latest version of Tally in which advance has been made from
tally erp 9. In which we have prepared QR Code, E-invoice, E-Way Bill,
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Multi Printing, Bank Cancellation update, Oman VAT, e-payment as
well as user friendly interface. For more information, visit the link
below.

What Is Accounting?
Accounting is the process of recording, classifying and summarizing
financial transactions. It provides a clear picture of the financial health
of your organization and its performance, which can serve as a catalyst
for resource management and strategic growth.Accounting is like a
powerful machine where you input raw data (figures) and get
processed information (financial statements).

Trade (Business):-
The sale and purchase of goods done for the purpose of making a profit
is called trade.
Proprietor (Owner ): –
The person starting the business, who arranges for the necessary
capital and carries the risk of loss and loss of the officer to receive the
profit., The owner of the business is called.
Capital
Money to start a business by the owner of the business, It is imposed
as cash or other property, it is called capital. In the business, the capital
is employed for the purpose of profit, that part of the profit which is
not removed from the business, Capital: – Assets – Responsibilities
Drawing (Withdrawal)–
Goods or cash which are taken out by the owner of the business for
personal use of the business, This is called withdrawal or personal
expenditure. Withdrawal reduces the amount of capital.
Goods
The goods are called that thing, Which is traded – traded or traded.
Raw material obtained for the manufacture of goods under goods, Can
be semi-finished material or finished goods
Purchase
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When goods are purchased for sale by the merchant, It is called
purchasing. It can be purchased in the form of raw material or finished
goods. Purchase of properties, Purchase not included, Because they are
not for resale.
Purchase Return
Goods that are returned due to any of the purchased goods, Purchase
return or outward return (to him)Return Outward) It is said.
Sales
When the purchased goods are sold for the purpose of profit, it is
called selling. Cash sale to sell cash goods (Cash Sales) And sale of
credit to sell goods (Credit Sales) it is said.
Sales Return
Any goods sold are returned by the customer due to any reason, This is
called sales return or internal return. In the lobbySales return On entry,
it is entered into a journal voucher or debit note.

Stock (Stock or stock)

After a certain period of time, It is called a stock, on the last day of a
business year, which remains unsold, the last stock (Closing Stock) It is
said. This stock at the beginning of the new business year, Initial stock
(Opening Stock) It is called.
Assets (Assets):–
All such permanent and temporary items of business which are
necessary to run the business and which are owned by the
businessman, The assets are called. Like – machine, All instruments
used for personal use of land and business, Furniture, The printer,
Computer etc.

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Types of Assets
1. Fixed Assets Permanent Property () – Equipment, All instruments
used for personal use of land and business, Furniture, The printer,
Custom etc.
2. Current Assets Movable property (cash) – cash. Bank cash etc.

Liabilities (Liability or Liabilities):–

The liability of the business is called liability. There are some essential
states in the business., Those who have the obligation to repay the
business like – Capital, Bill of credit, Creditor, Bank overdraft etc.

Basic Accounting Terms

Revenue (Revenue): –
Revenue refers to the amount received regularly from the sale of
goods or services. Business day-to-day activities like rent – rent,
Interest, The commission, Discount, Dividends etc. are also called
revenue.
Expenses (the expense):-
Goods in business, Costs incurred for producing or acquiring goods and
services. The expenditure is called. Payments for receipt of goods and
services are covered under expenditure. wage, The freight, Salary paid
on delivery and sale of railway carriages and goods, The rent,
advertisement, the expense, Insurance is also included in the
expenditure. The cost of increasing the revenue in brief is called
expenditure.

Types of Expenses
1. Direct Expenses –
Payment for receipt of goods and services – wages, The freight,
Payment on delivery and sale of railway carriages and goods
2. Indirect Expenses –
increase revenue, the wages, The rent, advertisement, the expense,
Insurance etc. Expenditure (Spend): – Spend is the amount paid to
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increase the profit-earning capacity of the business. Expenses that are
paid for the acquisition or acquisition of assets in a business are called
expenses.
Gain (Benefit):-
this Is a kind of monetary gain, Which results from business like if
1,00,000 Goods worth Rs. 1,50,000 If sold in rupees 50,000 Receipt of
money will be called profit.Basic

Accounting Terms
Cost (Cost):-
Raw materials used in business and its functions, Service and loan, The
sum of all direct and indirect expenses to be produced or used to make
it useful is called cost of goods. The item includes the raw material or
assets.
Discount (Deduction, Discount or discount): ‘-
Concession granted to the concession given by the merchant to his
customers, It is called discount or discount. It is also called a gift.
Debtor:- The person, firm or an organization who takes goods or
service on credit from the business are called Debtors of the business.
In other words, the person, firm or Organisation who owes money or
money’s worth to the business is called debtor. For example, when
goods are sold to a person on credit that person pays the price in
future, he is called debtor because he owes the amount to the firm.

Creditor: – The person, firm or an organization from whom goods or

services are purchased on credit by the business are called the
creditors of the business. The business owes money to them. The
amount payable to creditors is a liability of the business. For example,
Madan is a creditor of the firm when goods are purchased on credit
from him.

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Entry (Entry): –
Entering the transaction in the books of account is called Entry.

Bad Debts / Debt: –

Unable to recover the amount due to the inability of the debtor or
going bankrupt, For a creditor, it is called bad debt or unapproachable
loan.
Debit and credit (Debit and Credit): –
Each account has two sides. The left side is called the debit compound
or the deviation and the right side is called the deposit centroid or the
integral. Accounting on the left side of an account is called a debit
account, which is traditionally abbreviatedDr. It is thus written that
accounting on the right side of the account is called deposit account,
which is traditionally Cr. Let’s write It is noteworthy that in Indian
bookkeeping system, the debit side is on the right and the deposit is on
the left.
Company (Firm): –
In a general sense, a firm refers to an entity that establishes a
partnership or does a business or business function, but in a broader
sense each business entity can be referred to as a firm.
Account / Leger / Account :-
Ledger or ledger is a table in which soida are classified according to
their nature and are written in order at a place under a heading in
simple words., The list that is made after sorting the accounts related
to property and income, etc., is an account or ledger.
Types of accounts
In financial accounting, every debit or credit transaction entry will
belong to one of the three types of accounts:

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1. Nominal account
A nominal account is a general ledger containing the transactions of a
business, namely – expenses, incomes, profits and losses. It contains all
the transactions that occur in one fiscal year. Furthermore, it resets to
zero and starts afresh when the next fiscal year begins.
Examples of nominal accounts are Commission Received, Salary
Account, Rent Account and Interest Account.
2. Personal account
You can think of a personal account as a general ledger that relates to
people, associations and companies.
It can be divided into three subcategories:
Artificial personal account
An artificial personal account represents bodies which are not human
beings but act as separate legal entities according to the law. For
example, government bodies, hospitals, banks, companies,
cooperatives, partnerships, etc.
Natural personal account
A natural personal account represents human beings—for example, a
Capital account, a Drawings account, Creditors, Debtors, etc.
Representative personal account
This type of personal account represents the accounts of natural or
artificial entities. However, the transactions in this type of account
either belong to the previous or the coming year.
For example, a representative personal account can contain
information on an employee’s due salary from last year.
3. Real account
Like the other two, a real account is also a general ledger, but it
contains transactions related to the liabilities and assets of a company.
The assets, in this case, can be further subdivided into tangible and
intangible assets.
Tangible assets include land, buildings, machinery, furniture, etc.
Alternatively, intangible assets include goodwill, patents, copyrights,
etc.
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Golden rules of accounting

TYPE OF ACCOUNT GOLDEN RULES

DEBIT
The Receiver
(DR)
PERSONAL ACCOUNT
CREDIT
The Giver
(CR)

DEBIT
What Comes In
(DR)
REAL ACCOUNT
CREDIT
What Goes Out
(CR)

DEBIT
All Expenses & Losses
(DR)
NOMINAL ACCOUNT
CREDIT
All Incomes & Gains
(CR)

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.
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.
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Profit & Loss Account
The Profit & Loss A/c is a periodic statement, which shows the net result of
business operations for a specified period. All the expenses incurred and
incomes earned during the reporting period are recorded here.The Profit and
Loss Account in Tally.ERP 9 displays information based on the default primary
groups. It is updated with every transaction/voucher that is entered and saved.

TYPES OF VOUCHERS:
1. CONTRA VOUCHER(F4):- Contra entry is a transaction indicating transfer of
funds from
CASH A/C TO BANK A/C
BANK A/C TO CASH A/C
ONE BANK A/C TO ANOTHER BANK A/C

FOR EXAMPLE:-
Q. Deposited Cash into HDFC Bank of RS. 10000.(Here, cash is real a/c and hdfc
bank is personal
ac. Now apply golden rules of both the accounts.)
Ans. Bank a/c Dr.(Personal a/c:-debit the receiver)
Cash a/c Cr.(Real a/c :-credit what goes out)

2. PAYMENT VOUCHER (F5):- Transactions relating to payment of money are

entered in this
voucher.
FOR EXAMPLE:-
Q. Paid Salaries for Cash RS. 20000 (Here, Salary is Nominal ac and Cash is real
ac. Now apply
golden rules of both the accounts)
Ans. Salary a/c Dr.(Nominal a/c:-debit all expenses/losses)
Cash a/c Cr.(Real a/c :-credit what goes out)
Q. Purchased goods for Cash Rs. 9000(payment of money)
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Ans. Purchase a/c Dr.
Cash a/c Cr.
3. RECEIPT VOUCHER (F6):- Transactions relating to receipt of money are
entered in this
voucher.
FOR EXAMPLE:-
Q. Received Commission of RS. 3000 in Cash.( Here, Commission is Nominal ac
and Cash is real ac.
Now apply golden rules of both the accounts)
Ans. Cash a/c Dr.(real a/c:-dr the receiver)
Commission a/c Cr.(nominal a/c:- cr all incomes/gains)
Q. Sold goods for Cash Rs. 7000(receipt of money)
Ans. Cash a/c Dr.
Sales a/c Cr.
4. JOURNAL VOUCHER(F7):- A Journal Voucher Records the Transactions
Related
to Depreciation, Provisions, Purchase and Sale of Fixed Assets on Credit, Write-
Off Balances, and Adjustment Entries.(It doesn’t involve Cash or Bank a/c)
FOR EXAMPLE:-
Q. Purchased goods from RS TRADERS on credit Rs. 15000
Ans. Purchase a/c Dr.
RS Traders a/c Cr.( here, RK TRADERS:-Sundry Creditors:-PERSONAL a/c {CR. the
giver})
Q. Sold goods to Surajlal on credit Rs. 14000
Ans. Surajlal a/c Dr.
Sales a/c Cr.
5. SALES VOUCHER(F8):- Sales Voucher is used to record the Sales transactions
of the company.
FOR EXAMPLE:-
Q. Sold goods to SHYAM Rs. 5000 in cash.
Ans. SHYAM A/C Dr. here, Shyam:-Sundry Debtor:-PERSONAL a/c {DR. the
Receiver})
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Sales A/C Cr.

6. PURCHASE VOUCHER(F9):-Purchase Voucher is used to record the purchase

transactions of the company.
FOR EXAMPLE:-
Q. Purchased goods from SK TRADERS Rs. 15000
Ans. Purchase a/c Dr.
SK Traders a/c Cr.( here, SK TRADERS:-Sundry Creditors:-PERSONAL a/c {CR. the
giver})
7.Debit Note(CTRL+F9)
This note will use for purchase returns, it is issued by a buyer to a seller debiting
to his account and requesting for credit note.
8. Credit Note(CTRL+F8)
This note will use for sales returns, it is issued by a seller to buyer in different
situations informing that his account is credited.
Goods and Service Tax (GST)
What is Goods and Service Tax?
GST is an Indirect Tax which has replaced many Indirect Taxes in India. The
Goods and Service Tax Act was passed in the Parliament on 29th March 2017.
The Act came into effect on 1st July 2017; Goods & Services Tax Law in India is a
comprehensive, multi-stage, destination-based tax that is levied on every value
addition.
In simple words, Goods and Service Tax (GST) is an indirect tax levied on the
supply of goods and services. This law has replaced many indirect tax laws that
previously existed in India.
Types of taxes under GST
There are currently three types of GST
CGST – Central GST – Applies to sales within the state – goes to Central
Government
SGST – State GST – Applies to sales within the state – goes to State
Government
IGST – Integrated GST – Applies to sales outside the state – goes to Central
Government
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What is CGST?
CGST rate or Central GST rate is levied on the intrastate supply of goods and
services. The proceeds of which will be attributable to the Centre, as per
the CGST Act.
What is SGST?
SGST rate or State GST rate is levied on the intrastate supply of goods and
services. The proceeds of which will be attributable to the States, as per the
SGST Act – which is passed and recognised by the assemblies of respective
States.
What is IGST?
IGST rate or Integrate State rate is levied on the interstate supply of goods and
services, whenever such supplies are happening across state boundaries, and in
terms of imports, as per the IGST Act.

For example, if you sell something within the state, 50% of the GST will be CGST
and 50% of the GST will be SGST. But when you sell something outside a state,
100% of it will be IGST which will go to the Central Government.
To enable GST features in Tally
Step 1 : - Go to Gateway of Tally > F11: Features > F3 : Statutory & Taxation
Step 2 : - In the screen you will find the following options : -
Enable goods and service tax (GST): Yes
Set/alter GST Details: Yes.
This will display another screen where you can set GST details of the company
such as the state in which the company is registered, registration type, GSTIN
number etc.
Step 3 : - Press Y or Enter to accept and save.

What is UTGST?
The fact that Union Territories are directly under the governance of the Central
Government, differentiates them from the states, which have their own elected
governments.
This called for a separate taxation structure for the Union Territories and thus
UTGST rate or Union Territory GST was introduced instead of SGST for the
following 5 Union Territories in India –
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  Chandigarh
 Lakshadweep
 Daman and Diu
 Dadra and Nagar Haveli
 Andaman and Nicobar Islands
In the Indian Constitution, the definition of ‘States’ included union territories
with their own legislature. Hence the SGST Act also applied to the 2 union
territories of Delhi and Puducherry – since they have their own legislature, with
elected members and Chief Minister. For the rest of the 5 union territories listed
above, UTGST rate will be levied for supply of goods and services.

What are GST Rates in India?

GST rate schedule for goods
Under GST, there are 7 specified rates for goods, each of which have been
classified under a Schedule in the GST Rates Booklet for Goods. They are as
follows:
Schedule I: Nil Rated
Schedule II: 0.25%
Schedule III: 3%
Schedule IV: 5%
Schedule V: 12%
Schedule VI: 18%
Schedule VII: 28%

GST rate schedule for services

Under GST, there 5 specified rates for services, each of which has been classified
in the GST Rates Booklet for Services. They are as follows:
Nil Rated
5%
12%
18%
28%

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