Tally

Dr. S. Muthumani/Management Studies/Sathyabama University.

TALLY EXERCISE – 1.1 1. Classify The following into Income, Expenditure, Assets and Liabilities (Put Tick mark in the appropriate column) Income Expenditure Asset Liability 1

Cash in Hand

2

Salaries

3

Wages

4

Rent paid

5

Land

6

Buildings

7

Bank Balance

8

Over draft

9

Traveling

10

Dividend received

11

Interest paid

12

Sundry Debtors Debtor s

13

Sundry Creditors Creditor s

14

Loans and Advances (dr)

15 Capital 16

Reserves and Surplus

17

Income tax

18

Provisions

19

Bills Receivable

20

Furniture and Fittings

21

Indian Bank Deposits

22

Printing and Stationery

23

Telephones bills

24

Computer

25

Scooter


2.Classify The following into Income, Expenditure, Assets and Liabilities (Put Tick mark in the appropriate column) Income Expenditure Asset Liability 1

Cash at Bank

2

Factory Rent

3

Lighting

4

Interest paid

5

Tools

6

Furniture

7

Bank Balance

8

Over draft

9

Bills Payable

10

Dividend earned

11

Interest paid

12

Sundry Debtors Debtor s

13


14

Loans and Advances (dr)

15

Sheeja Capital

16

Provisions and Reserves

17

Sales tax

18

Land and Buildings

19

Bills Receivable

20

Fittings

21

IOB Deposits

22

Pooja Expenses

23

Telephones bills

24

Computer

25

Van


TALLY EXERCISE 1.2 1.Find the nature of the following entries (Please put tick mark in the appropriate column) RECEIPT PAYMENT CONTRA 1

Electricity bill paid

2

Wages paid

3

Interest received

4

Discount allowed

5

Purchases

6

Sales

7

Furniture purchased

8

Scooter purchased

9

Computer Purchased

10 Salaries paid 11 Telephone expenses 12 Dividend income 13 Amount deposited into IOB 14 Money transferred from from IOB TO Indian Bank 15 Amount received from Sundry Debtors Debtor s 16 Amount paid to creditors 17 Money deposited into Canara Bank 18 Money transferred from from Canara bank to Indian Bank 19 Machinery purchased 20 Loan amount received from Raman


2.Find the nature of the following entries (Please put tick mark in the appropriate column) RECEIPT PAYMENT CONTRA 1

Travelling expenses paid

2

Payments made to creditors

3

Discount earned

4

Discount allowed

5

Sales

6

Purchases

7

Tools purchased

8

Scooter purchased

9

Computer Purchased

10 Wages paid 11 Telephone expenses 12 Dividend income 13 Amount deposited into SBI 14 Money transferred from from IOB TO SBI 15 Amount received from Sundry Debtors Debtor s 16 Amount paid to Raja 17 Money deposited into Vijaya Bank 18 Money transferred from Vijaya bank to Indian Bank 19 Buildings purchased 20 Loan amount received from Rahul


TALLY Exercise 1.3 1. Prepare Trial balance of MM Associates : Balances Amount (Rs.) Capital 50000 Cash 15760 Bank 12800 Purchases 27100 Sales 27000 Furniture 15000 IOpening stock 1800 Brokerage 40 Typewriter 2100 Rent paid 1000 Salary Account 1500 Return inwards 100 Return outwards 1100 Debtors 4400 Travelling 100 Sundry Creditors Creditor s 4200 Discount allowed 100 Telephone 500

2. Prepare Trial Balance for the following balances taken from the books of MM Traders: Balances Amount (Rs.) Capital 40000 Creditors 13000 Salaries 7200 Bills Receivable 15800 Bills Payable 8700 Debtors 28000 Sales 144000 Insurance 1200 Miscellaneous Expenses 600 Land and Buildings 23000 Discount paid 900 Commission received 800 Sales returns 3400 Purchase returns 2400 Carriage inwards 1400 Purchases 97500 Stock Opening 29900


3. Prepare the trial balance for the following balances taken from the books of MM Agency.

BALANCES Opening stock Repairs Machinery Furniture

Amount Rs. 9300 310 12670 1330

Office Expenses

750

Trading Expenses

310

Land and Buildings Bank Charges Mis. Income Purchases

15400 50 200 15450

Purchase Returns

440

Sales Returns

120


12370

Advertisement

500

Cash in Hand

160

Cash at Bank

5870

Sales

20560

Sundry Expenses

150

Insurance

500

Travelling Expenses

200

Capital Loan

24500 5000


4. Prepare Trial Balance for the following balances taken from the books MM General Merchants: Balances

Capital

Amount (Rs.)

180000

Drawings

3200

Opening Stock

9000

Purchases Sales Returns Sales Wages Insurance paid Duty paid

64500 2000 119000 16000 1500 10,000

Packing expenses

2000

Carriage outwards

8000

Postage Advertisement

100 1000

Miscellaneous expenses

300

Discount received

500

Bills Payable

9000

Bank over draft

3000

Land

90000

Plant

70000

Furniture

1000

Debtors

25400

Creditors

42000

Cash

40500

Deposits

9000


TALLY EXERCISE 1.4 (1) (a) Journalise the following transactions:

1. Malini started business with Rs.50,000 2. Opened current account with Indian overseas Bank with Rs.5,000 3. Bought goods from Latha Rs.40,000 4. Paid to Latha Rs.25,000 5. Sold goods to Kumar Rs.36,000 6. Kumars account was settled . (b)Write the above entries in the following manner:

Account to Debited

Account to be credited

Malini started business with Rs.50,000 Opened current account with Indian overseas Bank with Rs.5,000 Bought goods from Latha Rs.40,000 Paid to Latha Rs.25,000 Sold goods to Kumar Rs.36,000 Kumars account was settled . (c)List the ledger accounts to be opened for the above said transactions.


(2).(a) Journalize the following transactions:

3.2.2003

Bought goods for cash Rs.14,500

7.2.2003

Sold goods to Laxhmi on credit Rs.5,000

9.2.2003

Received Commission Rs.300

10.2.2003 Cash sales Rs.29,000 12.2.2003 Bought goods from Meenakshi on credit for Rs.6,000 15.2.2003 Received five chairs from Saravana Trader at Rs.300 each. 20.2.2003 Paid Cash to Saravana Stores. 28.2.2003 Paid Salaries Rs.1,000 28.2.2003 Paid Rent Rs.500

(b) Write the above entries in the following manner:

Account to

Account to be

be Debited

Credited

Bought goods for cash Rs.14,500 Sold goods to Laxhmi on credit Rs.5,000 Received Commission Rs.300 Cash Sales Rs.29,000 Bought goods from Meenakshi on credit for Rs.6,000 Received five chairs from Saravana Trader at Rs.300 each. Paid Cash to Saravana Stores. Paid Salaries Rs.1,000 Paid Rent Rs.500

(c)List out the ledger accounts to be opened for for the above said transactions.


(3) (a)Journalise (a)Journalise the following Transactions:

1. Mani started business with the capital of Rs.50 Lakhs 2. Land Purchased for Rs.2lakhs 3. Goods Purchased from Raju Rs.2500000 on cash. 4. Goods Purchased from Raghu Rs.1,00,000 on credit 5. Goods sold on cash Rs.15 lakhs 6. Goods sold on credit to Raja Rs.20 lakhs. 7. Salaries paid Rs.10,000 8. Carriage inwards paid Rs.25000 9. Interest received Rs.25000 10. Computer purchased Rs.25,000 11. Money collected from Raja Rs.50,000 12. Cash paid to Raghu Rs.10,000 13. Money deposited into Indian Bank Rs.2,00,000 14. Amount transferred to Canara Bank from Indian Bank Rs.35,000 15. Payment made to Raghu Raghu by Indian Bank Cheque for Rs.1,00,000 16. Telephone expenses paid Rs.2000 17. Goods sold for cash Rs.5,00,000 18. Goods sold on Credit to Radha Rs.50,000 19. Goods purchased from from Amar for for Rs.2lakhs on credit 20. Cash purchases made Rs.25,000 21.Additionl Capital introduced by Mani Rs.10,00,000 22. Money deposited into Indian Bank Rs.2,50,000 23. Ten tables are purchased from Wood world each Rs.1,000 24. Payment made to Wood World by Indian Bank 25 Goods purchased from Lal and co on Credit Rs.35,000

3(b) Write the above transactions in the form of accounts to be debited and credited. 3(c) List out the ledger accounts to be opened for the above said transactions.


ACCOUNTING VOUCHERS

Procedure:

1. If the tally package was present in the desk top window double click the icon to open it. 2. In company information select create company-> to create a new company. 3. Creation of Ledger Accounts: In Gate way Tally select Account information Select Ledger – Select single ledger create Then type all the ledger accounts required based on the transactions. Control A to save-enter-press escape yes-press escape up to getting gateway tally menu. 4. Creation of Inventories: In gate way tally select inventory information Select stock group-select single stock group Then type all the stock groups under Primary Control A to save & escape to reach the gate way tally screen. 5. Settings: Gateway Tally (Master)->Select Account information enter Press F11->Set the Account features as: Maintain bill wise details YES Control A – Press escape up to Gate way Tally (Master) Select Inventory information enter Press F12->it goes to configuration Select Acc/Inv information Set the Choice as Allow Standard Rates for Stock items YES Control A to save -> Configuration Select voucher entry enter set the choice as Use Single entry NO Use Dr/Cr instead of To/By YES Control A to save Press Escape up to Gate way Tally 6. Create Units of Measure: In gate way tally screen Select Units of Measure Type Symbol as Nos and Formal Formal name as Numbers 7. Creation of Stock Items: In Gate way Tally Screen select Inventory information Select stock items & Select single stock item create Name: Sony 10 Kg Under: Washing Machine Units: Nos Dr. S. Muthumani/Management Studies/Sathyabama University.

Allow Std. Rates: Yes -> enter Fill standard cost (purchase price) and Selling Price Control A to save Press escape up to getting Gate way Tally Screen. 8. Entering the Transactions: In Gat way Tally Screen select accounting vouchers F4 Contra F5 Payments F6 Receipts F8 Sales F9 Purchases Note:1. While entering the transaction if any new ledger to be created use Alt C 2. Save every entry by control A.

TALLY QUESTION BANK

PART A

1. Define the term ‘Accounting’. 2. What is the need for Accounting to the Business Organizations? 3. Name the few important terms in accounting. 4. What is Accounting Cycle? 5. List out the usual transactions in a Business. 6. What are the three types of accounts maintained for transactions? 7. How do you classify the business organizations based on its transactions? 8. What is service organization? 9. What is manufacturing organization? 10. What is Trading organization? 11. State the concepts in of accounting. 12. What is Book Keeping? 13. Explain single entry system of book keeping. 14. Explain Double entry system of book keeping. 15. What is Real Accounts? 16. What is Personal Accounts? Dr. S. Muthumani/Management Studies/Sathyabama University.

17. What is Nominal Accounts? 18. State the rules for Personal Account. 19. State the rules for Real Account. 20. State the rules for Nominal Account. 21. What is a Journal? 22. What is a compound Journal Entry? 23. What is voucher? 24. What is a trial balance? 25. State the advantages of trial balance. 26. State the purpose of preparing the trading account. 27. List out the purposes of preparing Profit and Loss account. 28. What is a Balance Sheet? 29. Explain the term ASSETS. 30. Explain the term LIABILITIES. 31. How can be assets classified? 32. How can be liabilities classified? 33. State any four features of Tally Package. 34. How do you create company details in Tally? 35. How do you select the company in Tally? 36. How do you delete the company in Tally? 37. Name the few functional keys in Tally? 38. What are groups? 39. Mention any four primary groups in Tally. 40. Mention any four-sub groups in Tally. 41. What is ledger? 42. How do you create ledgers in tally? 43. How do you classify the accounting transactions while working in Tally? 44. What do you refer as Contra Entry? 45. Mention any four components of company creation screen. 46. State the benefits of accounting on computers. 47. How can you view the trial balance in Tally? Dr. S. Muthumani/Management Studies/Sathyabama University.

48. What are the financial reports available in Tally? 49. What is a Day Book? 50. What is the Tally Financial Accounting Certification?

PART B 51. Discuss the different concepts and conventions of Accounting. 52. Describe the features of TALLY Package. 53. Elucidate the needs of Accounting for Business Organizations. 54. How do you classify the business organizations based on its transactions and explain them in detail. 55.Compare and Contrast Computerized Vs Manual Accounting. 56. What are the advantages and limitations of Double Entry System of Book Keeping? 57. Describe the nature of a Balance sheet and give the format of a Balance Sheet. 58. Distinguish between a Trial Balance and Balance Sheet. 59. Draw the flow chart for company creation and company alteration details in Tally. 60. State any twenty twent y functional functional keys and its purpose while using the Tally.


TALLY PART A Accounting Definition: Accounting is the art of recording, classifying and summarizing the business transactions in a significant manner.

Need for Accounting:  To know the results of operations.  To know the financial position as on date.  To know the liquidity position  For business acquisition.  For statutory compliance. Few Important terms in Accounting:  Transactions  Account  Voucher  Capital  Purchases and Sales  Stock etc. Accounting Cycle: The accounting cycle is a complete sequence of accounting procedures, which are repeated in the same order during accounting period.

Usual Transactions involved in Business:  Purchase of goods  Payment for Expenses  Sale of goods or services  Receipts etc.

Types of Accounts maintained for Transactions:  Real Accounts  Personal Accounts  Nominal Accounts

Classification of Business Organizations based on transactions:  Trading organization  Manufacturing organizations Dr. S. Muthumani/Management Studies/Sathyabama University.

 Service organizations

Service Organization: An organization providing services is called as service organization.

Trading organization: An organization involved in the process of buying and selling is called as trading organization.

Manufacturing Organization: An organization in the process of transforming raw materials into finished goods for consumers, or for further processing by others is called manufacturing organization.

Concepts in Accounting;  Entity concept  Dual Aspect concept  Going concern concept  Accounting period concept  Money measurement.

Book Keeping: Art of recording in a systematic manner in the books of accounts.

Single Entry system of Book Keeping: It refers the system where only the personal and cash aspects of the transaction are recorded in the books.

Double Entry system: It is the most common system of book keeping whereby the two aspects of every transaction i.e. the receiving aspect and the giving aspect are recorded in the books of accounts.

Real Account: Real Account refers the visible and real items. E.g. cash, bank etc Personal Account:


Personal Account refers the person with whom the company has dealings. E.g. customers and suppliers. Nominal Account: It refers the expenses and income accounts. E.g. salaries , rent received Journal: A journal may be defined as the book of original or prime entry containing a record of transactions from which the posting is done to the ledger. Voucher: A voucher is a document containing the details of financial transactions. E.g., Sales invoice, purchase invoice, pay slip etc.

Trial Balance: Trial balance can be defined as a list of balances standing on the ledger accounts and cash book of a concern. Advantages of Trial Balance:  It is a consolidated statement of all the balances.  It helps to verify the accuracy of the entries made in the ledger.  It helps to prepare the final accounts. Purposes of Preparing the Trial Balance:  To verify the accuracy of the entries made in the ledger.  To prepare the final accounts. Purpose of preparing the Trading Account: To find the margin over purchase and sale of goods. Purpose of Preparing the Profit and Loss Account: It is the statement prepared to compare the incomes and expenses and finally reports whether Net Profit or Net Loss incurred during the accounting period. Balance sheet: A statement which sets out the Assets and Liabilities of a business firm and which serves to ascertain the financial position of the same on any particular date. Assets: Assets represent everything, which a business owns and has money value. Liabilities: It represents the responsibility of the business to repay in terms of Rupees. Classification of Assets: Dr. S. Muthumani/Management Studies/Sathyabama University.

 Fixed Assets  Current Assets  Tangible Assets  Fictitious Assets

Classification of Liabilities:  Long term liabilities  Current liabilities  Contingent liabilities. Features of Tally Package:  Maintain complete range of accounts.  Provided multiple reports.  Various options  Allows accounts of multiple companies companies simultaneously. Creaton of Company in Tally: Go to Gateway Tally > Company info >Create Company Alteration of Company Details in Tally: From Gateway Tally -> Company information menu –> Select Alter –> Enter. (To go to company information Alt F3) Selection of Company in Tally: From Gate way of Tally -> Company information menu -> Select Company (enter).Tally displays the name of the company screen. Select the company as you wish. Deleting a Company: Follow the same path as that used for Alter company to display company alteration screen. screen. Here use Alt + D key and and Tally displays a message ‘Delete’ Yes or No. No. By pressing yes or enter key . Tally displays another message ‘Are you sure?’ Yes or No. By pressing yes company will be deleted. Functional Keys in Tally: F1 = To select company. Alt+F1 = To shut company. F2 = To change Date Alt + F2 = To change period Alt +F3 = To get into company info screen Control + A = to save the screen. Groups: Collection of ledgers based on similar nature of ledgers are known as groups. Primary Group: Primary Groups are the main groups which will be useful at the time of reporting. Dr. S. Muthumani/Management Studies/Sathyabama University.

Sub-Groups: Sub groups are the secondary groups, which is based on the primary Group. Primary Groups:  Capital Accounts  Current Assets  Current Liabilities  Fixed Assets  Loans and liabilities etc. Sub Groups:  Cash in hand  Cash at Bank  Sundry Debtors  Provisions etc., Ledger: Ledger is an accounting head which is used to enter the transaction and identify the same. Creation of Ledger in Tally. Gate way of Tally -> Accounts information -> ledgers -> create. Contra Entry: Contra entry is a transaction indicating transfer of funds from cash account to bank account / bank account to cash account / one bank account to another bank account. Benefits of Accounting in computers:  Multiple reports available in short time  Accuracy  Enables faster decision-making. Components of Company creation Screen:  Directory  Name  Mailing Name  Address and State  Email Address  Use Indian VAT  Currency symbol etc.

View of Trial Balance in Tally: Gate way of Tally > Display > Trial balance. Financial Reports Available in Tally: Dr. S. Muthumani/Management Studies/Sathyabama University.

 Balance Sheet  Profit and Loss Account  Trial Balance  Account Books  Day Books

Day Book: The day book is a list of all transactions for a particular day. Tally Financial Accounting Certification: The tally financial accounting certification is an online test for business accounting Tally. Once certified you will join the global community of Tally Certified Professionals.

PART B

Business organizations perform a variety of transactions and can be classified as follows:  Service Organizations  Trading Organizations  Manufacturing Organizations.

Service Organizations:

Meaning: An organization providing services is called service organizations. Nature:  Service organizations provide their services at the point of consumption by the customer . Thus, such organizations could be severely hit on price if there is demand dip at the time for production.  Services are perishable, So the pressure on the service organization to provide services is more than that on a manufacturing organization or a trading organization.  Customer interaction is greater in service organizations than in manufacturing or trading organizations.  In service organization, services are usually provided by people, not machines. So, service organizations are more labour intensive than manufacturing organizations.  Customer goodwill is an intangible asset for service organizations, which can be destroyed quickly. Accounting in a Service Organization : The organization maintains regular books of account. Most service organizations do not deal in inventory and therefore, do not need to maintain inventory records. They do not follow a standard pricing policy for all customers, at all times. Dr. S. Muthumani/Management Studies/Sathyabama University.

CUSTOMER

Services

Payment of bills

Service Organization

Trading Organization:

Meaning: An organization involved in the process of buying and selling is called Trading Organization. Nature:  The actual market price is established and valid for a short based on the current supply and demand.  The value of the product is determined by the customers expectations of quality.  A trading organization has to continually keep track of market demand and ensure that inventory planning is done to take advantage of demand whenever it arises.  Different customers may be charged different prices by varying the percentage of discount on the price list.

Accounting in a Trading Organization: The trader must keep track of stock availability, customer requirement, cost of procurement and market changes. The accountant in trading organization has to maintain updated inventory records apart from regular accounting.


Collections

Customer Demand Tra Tradin or anization tion Manufacturing Organization: The process of transforming raw materials into finished goods for consumers, or for further processing of others in the channel is called Manufacturing. Nature:  The production cycle and the market cycle need not match. Inventor Inventor based based on cust custome omerr demand demand  Usually, the entire cycle of procurement, production, distribution and realization is longer as compared to other types of organizations.  A high level of standardization is possible.  Scientific methods can be used to reduce the production cost, which forms a Sale Arrival of stock major part of the total cost of the product. Accounting in a Manufacturing Organization:  A company needs to account for inventories like raw materials, work in  progress and finished goods to arrive at the profit made for the period.  Changes in the inventory valuation method change the profits made during the period.  Accounting in manufacturing organizations requires more planning, preparation and scheduling as compared to accounting in trading and service organizations.


Customer

Consumption

Manufacturing organization

Inventory Planning Demand Working capital management

Market

Finished Goods

FEATURES OF TALLY PACKAGE: 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 globe, with over quarter million customers. Tally’s market share is more than 90% NO Accounting codes: Unlike other computerized accounting packages that require numeric codes, Tally pioneered the no accounting codes concept. Tally users have the freedom to allocate meaningful names in plain English to their date items in the system. Complete business solution: Tally provides a comprehensive solution to the accounting and inventory needs of business. The packages comprises of financial accounting and book-keeping and inventory accounting. Flexible and easy to use: Tally is very flexible. It minimize the human thought process, which means that Tally can adapt to any business need, rather than the user trying to change the way the business is run to adopt to the package. Versatility: Tally is suitable for a range of organizations from small grocery stores to large corporations with international locations and operations. Multi-Platform availability: Tally is available on Windows 95, 98, ME, 2000 and NT. It runs on a single PC or a network , supports access via any combination of platforms. Dr. S. Muthumani/Management Studies/Sathyabama University.

Simple and rapid installation: Tally has a simple, menu-driven installation procedure. The user can install the program files on any drive, if the hard disk has partitions. Unlimited multi-user support: A multi-user version of Tally can be installed on a net work having any number of computers with different operation systems like Win 95, 98, NT 2000, XP and Linux. Internal back up/restore: Tally has in built, user friendly back up and restores option. Tally helps the user to take back ups of one or more companies or all companies in a single directory in the local hard disk or in any external media. Tally Audit: The Tally audit feature provides the user with administrator rights, a capability to check the correctness of the entries made by the authorized users and alter these entries, if necessary. Once the entries are audited, Tally 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. Multi-directory for company management: The user can create multiple directories where he can store data. The data stored in in these directories can be accessed directly in Tally by specifying the path

FUNCTIONAL KEYS IN TALLY:

F2

-

To change Date

Control A

-

To save

Control Q

-

Exit

Alt F2

-

To change period

F4

-

Contra

F6

-

Receipts

F8

-

Sales

F9

-

Purchase

F 11

-

To set features

F 12

-

To set configuration

Esc

-

To go back to the previous screen

F1

-

Select company

Alt C

-

To create new ledgers, settings etc.

Alt F2

-

To shut the company




Tally

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