Accounting Fundamental And Tally Prime Groups

What is Tally Prime?

Tally Prime is a complete business management software for small and medium business. Tally Prime helps you manage accounting, inventory, banking, taxation,  payroll and much.

What Is Accounting ? Fundamental

Definition of Accounting

Accounting is a systematic recording day to day business transaction is called as accounting.

Accounting is the process of identifying, recording, classifying and reporting information on financial transactions in a systematic manner for the purpose of providing financial information for decision making.

Types of Accounts

There are basically three types of Accounts maintained for transactions

  • Personal Account
  • Real Account
  • Nominal Account

Personal Account: Any individual person or any firms or any company or a bank is considered in a Personal account.

For example:-

  • Rajesh Singh 
  • Muna Enterprise 
  • Wipro Pvt Ltd 
  • PNB Bank 
  • Capital etc.

 

Real Account: Account of any physical things. The cash account or goods account are examples of Real account.

For example:-

  • Cash 
  • Land 
  • Building 
  • Furniture
  • Computer etc.

Nominal Account: Account of any invisible things that means that things are in terms of cash are examples of Nominal account.

For example:- 

  • Discount 
  • Commission 
  • Salary 
  • wages 
  • Freight etc.

Rules of Accounting


Basic concept of accounting

Accounting : It is an art of recording, classifying and summarizing in significant manner and in terms of money, transactions and events which are of financial character and interpreting the results thereof.

Business Transaction : A business transaction is “The movement of money and money’s worth form one person to another”. Or exchange of values between two parties is also known as “Business Transaction”.

Purchase : A purchase means goods purchased by a businessman from suppliers.

Sales : Sales is goods sold by a businessman to his customers.

Purchase Return or Rejection in or Outward Invoice : Purchase return means the return of the full or a part of goods purchased by the businessman to his suppliers.

Sales Return or Rejection out or Inward Invoice : Sales return means the return of the full or a part of the goods sold by the customer to the businessman.

Assets : Assets are the things and properties possessed by a businessman not for resale but for the use in the business.

Liabilities : All the amounts payable by a business concern to outsiders are called liabilities.

Capital : Capital is the amount invested for starting a business by a person.

Debtors : Debtor is the person who owes amounts to the businessman.

Creditor : Creditor is the person to whom amounts are owed by the businessman.

Debit : The receiving aspect of a transaction is called debit or Dr.

Credit : The giving aspect of a transaction is called credit or Cr.

Drawings : Drawings are the amounts withdrawn (taken back) by the businessman from his business for his personal, private and domestic purpose. Drawings may be made in the form cash, goods and assets of the business.

Receipts : It is a document issued by the receiver of cash to the giver of cash acknowledging the cash received voucher.

Account : Account is a summarized record of all the transactions relating to every person, every thing or property and every type of service.

Ledger : The book of final entry where accounts lie.

Journal entries : A daily record of transaction.

Trail Balance : It is a statement of all the ledger account balances prepared at the end of particular period to verify the accuracy of the entries made in books of accounts.

Profit : Excess of credit side over debit side.

Profit and loss account : It is prepared to ascertain actual profit or loss of the business.

Balance Sheet : To ascertain the financial position of the business. It is a statement of assets and liabilities.

Current asset : It is converted into cash with in a year. Ex. Bills receivable

Direct expenses : These are the expenses which are directly related to manufacturing of goods. Ex. Wages, factory rent, heating, lighting etc

Indirect expense : These are the expenses which are indirectly related to manufacturing of goods. Ex. Salary, rent, stationery, advertisement, printing

Depreciation : Decrease the value of the asset.

Sundry debtors : The person who is the receiver or customer

Sundry creditors : The person who gives or supplier.

Expenses Outstanding or Unpaid expenses or Expenses due : Expenditure incurred during current year but the amount on which is not yet paid. (Added to the expenditure on the debit side and entered on the liability side.)

Income received in advance or Income received but not earned

Income received during the current year but not earned or a part of which relates to the next year. (Deducted form the concerned income on the credit side and entered on the liability side)

Prepaid advance or Expenses or Prepaid expenses

Expenditure paid during current year but not incurred or a part of which relates to the next year is called expenditure prepaid. (Deducted form the concerned expenditure on the debit side and entered on the assets side)

Income outstanding or income earned but not received or Income accrued

Income outstanding means income earned during the current year but the amount on which is not yet received (added to the concerned income on the credit side and entered on the asset side)


What Is Transaction?

Transaction is a between two person or more person exchange goods or money is transaction

There are two types of transaction

  •      Cash transaction
  •      Credit transaction

What Cash Transaction?

Cash transaction is a exchange for goods and service can be paid cash is called as cash transaction.

What is credit transaction?

Credit transaction is a exchange for goods and services cannot be paid cash is called as credit transaction

What is tally prime ?

Tally Prime is a complete business management software for small and medium business. Tally Prime helps you manage accounting, inventory, banking, taxation,  payroll and much.

Tally Prime is accounting software, used in business to record, summarize and maintain business transactions. Tally was developed in 1984 by Shyam Sunder Goenka in Bangalore.

Download Tally Prime from click here

Install in your PC / Laptop

For Training purpose: Most of the computer training Institute use Educational Mode:

Note: Tally Prime- educational mode work without a license, where you can input data only on the first, second, and last days of the month.

 

Procedure for creating company in Tally

Double click on Tally icon on desktop. Alt+F3 Company info-Create company.

Accounts Only : To maintain only the financial accounts of the company. Inventory (stock) management is not involved in it.

Account with Inventory : This is the default option, which allows maintaining both the financial account of the company as well as the inventory of the company.

Select Company : We can choose the company which is already created. Shortcut key - F1.

Shut Company : It is used to close the company which is opened. Shortcut key - Alt+F1. Alter : It is used to make alterations in the company creation like name, date, maintain etc. Quit : Exits from Tally.

 

1. Click on quit button.

2.         Esc, Esc, Esc and enter.

3.         Ctrl+Q

 

 

Start Tally Software

 

Open Tally > W: Work in Educational Mode

 

Create Company In Tally 

F3:Company> Create Company 

Company Name : Super Market

Fill up : Address, State and other optional details.

Accept

 

Company Created Successfully,

(Enable features as per your business need)

 

Accounting

Maintain Account       : Yes

Enable bill wise entry : Yes

Inventory        : No

Enable Goods and Service Tax (GST)            : No TDS         : No

Accept

 

Shut Company

F3 >Company > Shut Company

 

Alter Company

F3 > Select Company > Super Market> Alter Company

Change your address or any other data

Accept

 

Delete Company

Go To> F3 (Company)> Alter Company > Alt + D Company Super Traders has been deleted

 

Again Create A  Company D-Mart

(Follow the steps mentioned in Create Company)


What is ledger in tally prime?

After creating a company in Tally, the next step is to create a Groups & Ledgers account. A ledger is an actual account used to identify business transactions and are used in all accounting vouchers. For example, purchase, payments, sales, receipts, and others account heads are ledger accounts.

 

What Is Group in tally prime?

Account Groups in Tally Prime are collection of ledgers of the similar nature. Account groups are helpful in maintaining and determining the hierarchy of Ledger Accounts. Groups are particularly helpful in creating compliant reports.  Tally Prime has already set 28 pre-defined Groups in Tally.


PRE-DEFINED GROUP

GATEWAY OF TALLY > CHART OF ACCOUNT > LIST OF MASTERS >GROUPS

 

There are 28 predefined groups in Tally

15 groups are Primary Groups and the remaining 13 groups are Sub-Groups

 

 

1. Branch / Divisions (P)

 

15. Direct Expense (P)

2. Capital Account (P)

16. Direct Incomes (P)

3. Reserves & Surplus

17. Fixed Assets (P)

4. Current Assets (P)

18. Indirect Expenses (P)

5. Bank Accounts

19. Indirect Incomes (P)

6. Cash-in-Hand

20. Investments (P)

7. Deposits (Asset)

21. Loans (Liability) (P)

8. Loans & Advances (Asset)

22. Bank OD A/c

9. Stock-in-Hand

23. Secured Loans

10. Sundry Debtors

24. Unsecured Loans

11. Current Liabilities (P)

25. Misc. Expenses (Asset) (P)

12. Duties & Taxes

26. Purchase Accounts(P)

13. Provisions

27. Sales Accounts (P)

14. Sundry Creditors

28. Suspense A/c (P)



Voucher

Create New Company : Super Voucher

All entries which you made in these given accounting vouchers are effect on your current accounting of your business.

F4: Contra

Cash deposited into bank and cash withdrawn from bank entries.

F5: Payment

Cash and cheque payment including cash and bank purchase entries.

F6: Receipt

Cash and cheque received including cash and bank sales entries.

F7: Journal

All non-cash transactions entries.

F8: Sales

Only credit sales entries.

F9: Purchases

Only credit purchase entries.

Alter + F7: Stock Journal

Stock transferred and production entries.

Tally Ledgers Under Group List | Download Complete List.


Group   Purchase Accounts

                All types of Purchase Accounts like

                Purchase Local 12 %

                Purchase Interstate 12%

                Purchase Local 0%

                Purchase Interstate 0%

                Purchase (Composition)

                Purchase Exempt (Unregistered Dealer)

                Purchase Local (Exempt Registered)

                Purchase Taxable (Unregistered Dealer)

                Purchase Nil Rated (Unregistered Dealer)

                Purchase Reverse Charge

                Purchase Import Taxable 12%

                Purchase Import Exempt

                Purchase Import Nil Rated

                Purchase (Own Branch)

                Purchase Return

               

Group   Sales Account

                All types of Sales Accounts like

                Sales Local 12 % (Registered)

                Sales Interstate 12%

                Sales Local Nil Rated

                Sales Interstate Nil Rated

                Salers Export With Bond

                Salers Export Taxable

                Export (0%)

                Sales Local (Exempt Registered)

                Sale To Consumer (Taxable 12%)

                Sale To Consumer (0%)

                Sale To Consumer (Exempt)

                Sales (Own Branch)

                Sale Return


Group   Duties and Taxes

                All types of Taxes like

                INPUT CGST SGST IGST CESS

                OUTPUT GST SGST IGST CESS

                Excise Duty Payable etc

                Service Tax Payable

                TDS Payables

                Input Vat Accounts

                Output Vat Accounts

                Cenvat Accounts

                Sale tax

                Income Tax

                VAT Payable

               

Group   Direct Expenses OR Expenses(Direct)

                All expenses which appear in Trading Account (except purchases) like

                Labor

                Power

                Electricity Expense (Factory)

                Loading Unloading Expense

                Warehousing Expenses

                Custom Clearing Charges

                Carriage

                Freight & Cartage

                Import duty

                Wages

                Coal & Fuel

                Coal, Gas & Water of Factory

                Consumed Material

                Export Duty

                Wages on Production

                Delivery Charges(In Purchase Bill

               

Group   Bank Account

                All Bank Current Account

                All Bank FD Account

                (Personal Savings Account and FD not recorded)

               

Group   Deposit Account

                All types of deposits like

                Security Deposit

                Electricity Deposit

                Rent Deposit

               

Group   Capital A/c

                All types of Capital Account like

                Share Capital

                Partner Capital Account

                Partner Current Account

                Proprietor Account

                Drawings

                Life insurance

                Equity Capital A/c

                Partners Capital A/c

               

Group   Current Assets

                Prepaid Maintenance Expense

                Prepaid Expense

                Prepaid Rent

                Prepaid Insurance Charges

                Interest Receivables

                Bill receivable

                Accrued income

                Mutual Fund

                CGST SGST IGST Credit

               

Group   Current Liabilities

                Bill drawn

                Bill Payable

                CGST SGST IGST  Payable

               

Group   Sundry Creditor

                Any Party from Whom Goods Purchased

                Party from Whom any Bill of Expense Received

               

Group   Loans and Advances (Assets)

                Any Party to whom we gave loan

                like Loan Given to Friends Relatives/Related Companies

                Any Party to whom we gave Advance

                like Advance to Supplier

               

Group   Loans Liabilities

                Any Party from whom we take loan.

                We can also put group Secured loan or Unsecured loan

                Debenture A/c

                Loans From Bank

                Loans From Outside Party

                Loans From Aravind (Friend)

Group   Fixed Assets

                All Fixed Assets on which Depreciation charged like

                Furniture

                Machine

                Plant and Machinery

                Mobile

                Computers

                Furniture and Fittings

                Car

                Scooter

                Laptops

                Office lighting

                Land & Building

                Good will

                Factory lighting

                Air Conditioner

                Accumulated depreciation

               

Group   Bank OCC

                Cash Credit Limit (CC)

                taken from bank

               

Group   Bank OD

                Overdraft Limit (OD)

                taken from bank

               

Group   Branch/Divisions

                Any Branch whose Separate Accounting Done

                (If  branch account maintained by head office only, then this account not required)

                Delhi Branch

                Branch in division

               

Group   Cash in Hand

                Impress Account

                (Cash kept with Employee)

                Petty Cash

               

Group   Investments

                All types of Investments like

                Investment in Shares

                Investment in Bonds

                Investment in Property/Plot etc.

                Long term investment

                Short Term Investment

               

Group   Stock-in-hand

                Stock

                Closing Stock

                Consignment Stock

                Opening Stock

               

Group   Misc. Expense (ASSET)

                Preliminary Expenses

                NOT yet written off

               

Group   Suspense A/c

                Suspense Account

                Any payment or receipt from party whose name not known

                Suspense

               

Group   Secured Loan

                Loans for whom Security Given

                like loan from bank/ Financial Institution

               

Group   Unsecured Loan

                Loans taken  for whom no Security given

                Like Short term loan from directors

                or loan from friends /relatives

               

Group   Reserve & Surplus

                Any type of reserve like

                General Reserve

                Capital Reserve

                Capital Reserve A/c

                Investment Allowance Reserve A/c

                Share Premium A/c

                Reverse and Surplus

Group   Provisions

                All Provisions except Provisions for bad debts

                Provision for Tax

                Provision for Expense

                Provision for Sinking Fund

                All types of Payables like Salary Payable, Audit fees Payable,

               

Group   Sundry Debtors

                Any Party to Whom Sales Made

                Provision for Bad Debts

               

Group   Retained Earring

                General Reserve

                Share Premium

                Any other Reserve

 

  Group   Direct Incomes OR Income(Direct)

                Any Income from main service like

                Freight Charges Income

                Delivery Charges Income

                Transportation Charges Income

                Professional Charges Income

                Consultancy Charges Income

                Maintenance Service Income


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