Tally ERP 9

Accounting is the language of business. It is the art of recording, classifying and summarizing manner
and in the terms of money, transactions, and events.

a. Recording
b. Classifying
c. Summarizing
All the transactions which take place in the day to day business.
This is done for a particular period of 12 months called “Financial Year”. It generally
starts on 1st April and ends on 31st March.
All the information of this period taken for financial events is helpful for decision making.

A person running a business needs to know his:

1. Assets (what he owns)
2. Liabilities (what he owes)
3. Profit or Loss
4. Accordingly, the future planning.

What is Tally?
Tally is an ERP accounting software package used for recording day to day business data of a
company.
Tally ERP 9 software is one claimed financial accounting system and inventory management system
with computer.
Tally ERP 9 accounting software that can integrate with other business applications such as sales,
finance, purchasing, payroll, inventory etc.
We can create and maintain up to 99,999 companies.
Tally has feature you can synchronization the transactions maintained in multiple locations offices can
be automatically updated.
Using payroll feature we can automate employee records management.
Generates consolidated financial statements as per requirements of company.
Managing single and multiple groups are very important features of tally.

What is accounting?
Account is a record of transaction which is related to Person, Company, Assets, Liabilities and
Income & Expenditure.
 TYPES OF ACCOUNTS
1. Personal Account 2. Impersonal Account
a. Natural Personal Account a. Real Account
b. Artificial Personal Account b. Nominal Account
c. Representative Personal Account
i. Tangible Real Account
ii. Intangible Real Account

1. Personal Account
Any Account is related to person and all types of companies they are called personal
account.
Example: Ram a/c, Shafi a/c, Google a/c, Microsoft a/c, SBI a/c, Jio a/c, Expenses payable & capital a/c.
a. Natural Personal Account
Example: Ram a/c, Shafi a/c
b. Artificial Personal Account:
Example: Google a/c, Microsoft a/c, Jio a/c, SBI a/c.
c. Representative Personal Account
Example: Capital a/c, Outstanding Expenses etc…
2. Impersonal Account
All types of account would be impersonal Account.
a. Real Account
All types of company assets account are called Real Account.
Example: stock a/c, computer a/c, furniture a/c, cash a/c, goodwill a/c. etc….
Tangible Account:
Those assets which can be seen and touched are Tangible Account.
Example: stock a/c, computer a/c, furniture a/c, etc…
Intangible Account
Those assets neither can be seen nor touched only can be felt are called Intangible
Account.
Example: Goodwill a/c, trademark a/c, copyrights a/c, etc…
b. Nominal Account
Any account which is related to Income and Expenditure they are called Nominal
Account.
Example: Salary a/c, wages a/c, carriage a/c, Interest on investment a/c, bank charges,
etc….
SO,
Basically there are three important accounts
Personal Account
Real Account
Nominal Account
 Golden Rules
1. Personal Account
Debit the receiver
Credit the Giver
Cash amount received from Mohan Rs.5000 Cash amount paid to Rahim Rs.10000
Rahim a/c ……………………. Dr 10000
Cash a/c…………………………. Dr 5000
To cash 10000
To mohan 5000

Started business with cash Rs. 20000

Cash a/c ……………………… Dr 20000
To Capital a/c 20000

2. Real Account
Debit what comes in
Credit what goes out
Cash amount received from mohan Rs.5000 Purchase mobile set in cash Rs. 15000
Cash a/c …………………………. Dr 5000 Mobile set a/c ……………………… Dr 15000
To mohan 5000 To cash 15000

Purchase goods in cash Rs. 8000

Purchase a/c………………………. Dr 8000
To cash a/c 8000

3. Nominal Account
Debit all expenses & losses
Credit all income & gains
Salary paid to ramya for Nov -19 by Cheque Paid telephone bill in cash for the month of
No.000012 Rs. 15000 Nov-19 Rs. 1000
Salary a/c………………………. Dr 15000 Telephone a/c………………………. Dr 1000
To SBI a/c 15000 To cash a/c 1000

Bank interest received Rs.212

SBI a/c………………………. Dr 212
To bank interest a/c 212
 MODERN APPROACH [American System]
1. Expense
Salary, wages, carriage, rent, office expenses, general expenses, fuel expenses, telephone
charges, internet charges, electricity charges, vehicle repairing & maintenance,
conveyance, travelling expenses, bank charges etc….
2. Income
Sales, tuition fees, bank interest, discount received, commission received, interest on
investment etc…
3. Assets
Cash, bank balance, investment, furniture, machine, plant, debtors, land & building,
tools, motor car, stock etc…
4. Liability [Loan]
Capital, creditors, loan, overdraft, expense payable, received in advance, etc….

1. Expense + Assets if increase than DEBIT

2. Expense + Assets if decrease than CREDIT
3. Income + Liability if increase than CREDIT
4. Income + Liability if decrease than DEBIT

Gateway of Tally-Accounts Info-Group

Bank account Deposit Investment Stock in hand
Loans and advance
Bank Od account Direct expenses Sundry debtors
Loan (liability)
Branch/division Direct income Miscellaneous expenses Sundry creditors

Capital account Indirect expense Provisions Suspense

Retained earning
Cash in hand Indirect income Unsecured account
Reserves and surplus
Current asset Duties and tax Purchase account
Sales account
Current liability Fixed asset
Secured loan
 Short cut keys
Alt+F3 Company information menu

Enter To accept information typed into a field.

To accept a voucher or master.

To get a report with further details of an item in a report.

Esc To remove what has been typed into a field.

To exit a screen.

To indicate you do not want to accept a voucher or master.

Ctrl + A to accept a form wherever you use the key combination the screen or report will be

Accepted as it is on this screen.

Ctrl + Q it quits the screen without making any changed to it.

Alt + C to create a master at a voucher screen.

When working within an amount field presses Alt + C to act as a calculator.

Alt + D to delete a voucher.

To delete a master.

Ctrl + Enter to alter a master while making an entry or viewing report.

F2 Date

Alt+F2 Change period

Alt+F1 to see detail

F11 Features company

F12 Configuration options are applicable to all the companies in a data directory.

Ctrl + N Calculator screen.

Ctrl + V Voucher mode (Cr. Dr)

 VOUCHER TYPES
F4 Contra:
Deposit into bank account Withdraw form bank
Cr. Cash Cr. Bank
Dr. Bank Dr. Cash

F5 Payment:
When cash paid to anyone | when Cheque issued from bank
Paid/Give Dr.
Cash/bank Cr.
F6 Receipt:
When cash received from anyone | when Cheque deposited in bank
Received/borrow/take Cr.
Cash/bank Dr.

F7 Journal:
Records adjustments between ledger accounts.

F8 Sales:
Records all sales.
Cash/party name Dr.
Sales Cr.
F9 Purchase:
Records all purchase.
Cash/party name Cr.
Purchase Dr.
F8 Credit Note
F9 Debit Note
F10 Reverse journal (if activated ‘Yes’ in F11)
F10 Memo voucher

IMPORTANT TERMS
 Fixed Assets:
Assets acquired relatively for a long period to carry the business.
E.g. Land and building, furniture, plant, and machinery etc…
 Current Assets:
Assets which are held essentially for a short period and are meant for converting
into cash.
E.g. cash, inventories, bills receivable etc…

 Liquid Assets:
Assets which are immediately convertible into cash without much loss.
E.g. marketable securities, stamps etc.
 Liabilities:
It is the amount which a business owes or has to return
E.g. loans taken from bank etc.
 Capital
It refers to the amount invested in a business enterprise.
 Capital Expense
Expenditure incurred for purchase of fixed assets.
 Revenue expenses
Expense incurred merely to maintain the business or to keep assets in good
working condition.
 Goods
The term “Goods” is used only to indicate the trading products and other products
which we purchase for sale or trading and not for consumption.
E.g. computer purchased for use is an “asset” but the computer purchased for selling is
“Goods” Goods purchased is known as “purchase” and Goods sold is known as “sales”.
 Stock
Some of the goods purchased sometime remains unsold, it is known as stock or
stock in trade.
 Debtors
A person to whom goods are sold on credit, means who owes money to the
business is called a debtor.
 Creditors
A person from goods are purchased on credit and amount is payable is called
creditor.
 Bad debt
An amount due from a debtor but not likely to recover from him.
E.g. an amount of Rs.5000 is receivable from Mr. Gopal but he is unable to pay the
amount back is called bad debt.
 Drawings
Money or goods withdrawn from business for personal used or household purpose.
 Trail Balance
The entries ledger is summarized in the form of a Trail Balance. It is a statement
containing the various Ledger balances on a particular date.
 Final Accounts
While trail balance checks the accuracy of the books of accounts, final accounts
reveals two facts.
1. Whether the business is in profit or loss during the period covered by the trail balance?
A trading and loss account is prepared for this purpose.
2. This is judged by preparing balance sheet for the business.

 Ledgers
Ledgers mean actual Account head. Ledgers have to be created for voucher entries
under certain groups. These two ledger Accounts inbuilt in the tally
1. Cash Account 2. Profit and Loss Account
 FINAL ACCOUNTS

Trading % profit % loss Account Balance Sheet

It is a Nominal Account It is a statement of Assets%
Gross profit / Loss and Net Liabilities ( The final position of the
Profit/Loss can be understood business can be understood )

Adjustment Entries –
While preparing the profit and loss account for a particular period it is absolutely essential that
the expenses, losses, income and gains relating only to that preparing profit and loss account and
balance sheet.
These Entries usually relate to the following:

 Closing stock
 Outstanding expenses
 Prepaid expenses
 Outstanding or accrued income
 Income received in advance
 Depreciation
 Bad debts
 Provision for bad debts
 Interest on Capital