Softsmith Infotech

Basic Accounting & Tally

Basic Accounting & Tally

What is Accounting It is an Art Recording,Classifying & analysing Transactions Financial Nature Inter retation of results

Basic Accounting & Tally

Income! "enerated from the o erations of the #usiness$e%am le& Sales,Ser'ices,Fees (% enses! Amount s ent to get the income Assets! For long term use in the #usiness,)hich can indirectly generate income$ (%am le& *achinery,+lant,Building etc ,ia#ilities!Amount aya#le #y the #usiness to outsiders,o)ners$(%am le& Creditors,loans etc Ca ital & Amount in'ested #y the o)ners$ +rofit and ,oss& Net Result of income and e% ense Balance Sheet& -o) the funds came into the #usiness and in'ested in the #usiness$

Basic Accounting & Tally

Accounting Conce ts Business (ntity Conce t!Business is different from Business .)ner "oing Concern Conce t!Business continues o'er a eriod of time *atching Conce t!Classification of transactions into income ,e% ense etc and matching them *oney *easurement / All transactions in terms of money$ -istorical conce t! Cost or mar0et rice )hiche'er is less

Basic Accounting & Tally

Accounting (1uation & Asset / ,ia#ility2Ca ital Nature of Accounts& +ersonal Real Nominal

Basic Accounting & Tally

Account is a transaction in monetary 'alues etaining to an item, erson,e% ense or income Rules for Accounts& Follo)ing are the rules for each Account& +ersonal Account& / 3e#it the Recei'er, / Credit the "i'er

Basic Accounting & Tally

Real Account ! 3e#it )hat comes in ! Credit )hat goes out Nominal Account ! 3e#it all e% enses ! Credit all incomes

Basic Accounting & Tally

What is a 4ournal ! 5ournal is the accounting record of a articular Transaction What is a ,edger ! ,edger is indi'idual record as )ell as summary of a transaction ertaining to an account$

Basic Accounting & Tally

Format of a 5ournal (ntry Account 3r To Account 6 Cr7 6Cr is not generally sho)n7 (%am le& Cash Account, Ca ital Account

Basic Accounting & Tally

+osting of an entry Balancing an account 3e#it Balances Credit Balances Nil Balances

Basic Accounting & Tally

Trial Balance ! ,ist of all 3e#it and Credit Balances +rofit and ,oss Account ! .nly Nominal accounts are transferred Balance Sheet ! All Balances in +ersonal Real Account are sho)n in Balance Sheet

Basic Accounting & Tally

"ate)ay to Tally / This is the main Screen for Tally Create Com any! This hel s in creating a com any$ Beginning 8ear& 3ate from )hich the com any is created Accounting 8ear& This is the financial year and should #e after the date )hich com any is created $

Basic Accounting & Tally

"rou s in Tally& Tally has 9: #asic grou s$A grou identifies similar natures of accounts under the same$ For e%am le Current Assets "rou sho)s under the same 'arious accounts li0e Stoc0,Cash,3e#tors etc$ "rou is Created under Accounting Info in Tally "rou can #e +rimary "rou li0e Ca ital or Su# "rou A;s Ca ital under +rimary grou Ca ital

Basic Accounting & Tally

,edger Account / It is an indi'idual Account li0e +ersonal,Real or Nominal$ Transaction is recorded in res ect of an Account ,edger is Created under Accounting info in Tally $ The same need to #e ma ed to a "rou $Cash account and +rofit & ,oss Account are default accounts

Basic Accounting & Tally

Transactions are recorded under Transactions in Tally$ "o to <oucher Transactions and select the mode of Transaction *ode of Transaction can #e +ayment,Recei t,5ournal,Contra +ayment and Recei t contains Cash Account, )here as 4ournal does not in'ol'e cash account$ Contra Account is used to record Ban0 and Cash related transactions ha ening simulatneously$

Basic Accounting & Tally

(%am les for Tally )or0& 3e#it #alances Credit #alances

Cash =>>> Ca ital ?>>>> Ban0 =>>> Furniture @>>> Creditors ?A>>> 3e#tors @>>> +&, =>>> !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Total 9A>>> 9A>>>

Basic Accounting & Tally

Example with Stock in Tally: Started Business with Cash 15000, Cheque 10000 urchased Cement 10 Ba!s " 500 Carria!e paid 150 Salary paid #00 Sold $ Ba!s " 500 Carria!e outwards paid, %00 urchased &urniture %00 Salary paya'le to ( 150 comission recei)a'le $00

Basic Accounting & Tally

Trial Balance& ,ist of all 3e#it and Credit Balances as on a articular 3ate$ +rofit and ,oss Account& An Account )hich sho)s the rofit and loss of a #usiness at the end of a articular eriod$ Balance Sheet & Statement sho)ing Assets and ,ia#ilities of the Business$ It is not an account

Basic Accounting & Tally

+rofit and ,oss Account& Sho)n in Tally under Re orts$ If transactions are correctly entered as er accounting rules, the +rofit & ,oss account in Tally sho)s the rofit or loss automatically$No se arate osting needed$ Balance Sheet&Sho)n in Tally under Re orts$+rofit can #e sho)n as addition to the ca ital or as a se arate account$It is sho)n on the lia#ility side$ ,oss can #e sho)n as a reduction from ca ital or as +&, Account in Asset side$

Basic Accounting & Tally

Ad'antages of Tally o'er *anual System +osting of transaction can #e done )ithout a rior 4ournal entry Balancing of an account is automatic +rofit and ,oss account and Balance sheet is automatically done$ No need to se arately close the nominal accounts Clerical errors ossi#ility is a#sol'ed$