Tally ERP 9: Comprehensive Guide to Accounting Features and Components

Posted on Jun 4, 2024 in Other subjects

1. Integrate Accounts and Inventory-This option has a significant effect on the Balance Sheet and Profit & Loss Account. If set to Yes, it extracts the stock/inventory balance figures from the inventory records and provides a drill down to the Stock registers from the Balance Sheet.

2. Income/Expense Statement Instead of P & L-By Default, this option is set to No.

If set to Yes – Tally.ERP 9 displays Income & Expenses A/c instead of Profit & Loss A/c in the Gateway of Tally.ERP 9 Menu. Income and Expenditure statement generally used for Non-Trading accounts and Profit & Loss a/c are used for trading accounts.

3. Allow Multi-Currency-By Default, this option is No.

Set this option to Yes, if you want to create multiple currencies and the Menu Currencies is displayed in Gateway of Tally > Accounts Info. menu.

Outstanding Management

4. Maintain Bill wise Details-The Bill-wise facility is made functional by setting this option to Yes. By activating the Bill wise feature,  the ledger masters under Sundry Debtors and Sundry Creditors automatically displays an additional option called Maintain balances bill-by-bill. On setting this option to Yes, an additional option Default Credit Period is displayed.

5. Activate Interest calculation-Set this option to Yes to enable Tally.ERP 9 to calculate interest automatically based on the interest rate and style of calculation specified. Enabling this option allows interest calculation on outstanding balances for any ledger account or on each invoice for the period it is outstanding completely or partly.

6. Use advanced parameters-The advanced parameters are useful when interest rates change from time to time. Set this option to Yes to enable this function.

Cost/Profit Centers Management-7. Maintain Payroll-Set this option to Yes if you want to maintain Payroll information on Tally.ERP 9 for the selected company .

8. Maintain Cost Centers-A Cost Centre can be defined as a unit of an organization to which transactions can be posted. When only costs or expenses are allocated to these units, they are referred to as Cost Centers. The Cost Centre feature is activated by setting this option to Yes.

9. Use Cost Center for Job Costing-Set this option to Yes to track all income and expenses for a Job/Project.

10. More than ONE Payroll/Cost category-Set this option to Yes to create more than one Payroll or Cost Category.

11. Use Pre-defined Cost Centre Allocations during Entry=Set this option to Yes to define Cost Centre Allocations. Refer Cost Centers and Cost Categories for details.

12. Show Opening Balance for Revenue Items in Reports-Set this option to Yes to display the opening balance in Cost Centre Report for the cost centers which are allocated to the Ledgers, grouped under Income and Expenses Group.

Invoicing

13. Allow Invoicing-Set this option to Yes, to create Sales and Purchase vouchers in the invoice format. The advantage of using the invoice format for sales invoice entry is that it enables automatic calculations of Duties and Taxes accounts.

14. Enter Purchases in Invoice Format-Set this option to Yes, to enable voucher class option in purchase voucher type.

15. Use Debit/Credit Notes-The Debit Note and Credit Note voucher types are made available only if this feature is set to Yes.

How can you create a new company in tally? Explain

Step 1: After login to Tally, double click on the option create company under company information. To create company in Tally, follow the following navigation path Gateway of Tally > Company Info > Create company

Step 2: The company creation window displays on the screen as show below image

Step 3: On company creation screen, update the following details

1. Directory: It is a path where the company date will be stored on system. By default, the tally directory will updated as C:\Users\Public\Tally.ERP9\Data and you can change the path as per your requirements.
2. Name: Update the name of company that identifies in Tally ERP 9.

Primary Mailing Details

1. Mailing Name: The mailing name of company will be automatically updated as per the given name of company, however the mailing name can be changed as per the requirements.
2. Address: Update the complete address details of company
3. Statutory Compliance for: Choose the country name as India from the given list of countries.
4. State: Choose the state from the given list of states.
5. Pin Code: Update the Pin Code of company, where it is located.

Contact Details

1. Telephone No: Update Company landline/ Telephone number
2. E-Mail: Update the company e-mail id
3. Mobile No: Mobile number for contacting
4. Fax no: Update the Fax number
5. Website: Update the official website address of company

Books and Financial Year Details

1. Financial Year From: Update the financial year starting date, all Indian companies financial year start from 1st April and ends on 31st March. Tally considers the 12 months from the date given for financial year. The financial year will be automatically displayed on Tally system, if FY starts in middle of year, you can specify the exact date from here.
2. Books Beginning from: Specify the books beginning date.

Security Control

1. Tally Vault Password: By enabling Tally vault password, the company data is secured in an encrypted form. The data is not accessible without the password, if you lost the password that will be not recovered.
2. Use Security Control: Enabling securing control helps only authorized users are allowed to enter/edit/delete the vouchers on Tally.

Base Currency Information

1. Base Currency Symbol: [icon name=”inr” class=”” unprefixed_class=””]
2. Formal Name: INR (India Rupees

8)Explain the disadvantages of computerised accounting.

• High Cost of Installation: The cost of the Computer and its accessories are costly. Computer hardware requires lots of maintenance, repair and software need subscription fees. After some time of purchasing a system, its new version comes into the market and makes the old system become outdated.
• Training Cost: Operating a computer is not an easy task. A person needs to be well trained and skilled to use a computer. Knowledge of accounting software is also necessary to do accounting.
• Time-Consuming: Once there is any default in the system it takes a lot of time and effort to restore the system. Sometimes computers work slow due to weather and require air-conditioned room to work properly.
• Maybe Hacked: In today’s era, it is easy to hack someone’s security system. Viruses and Malware can be entered into the system by hackers that cause danger to data. New generation computer comes with strong security it can combat this problem.
• Health Issues: It puts a lot of strain on the eyes. also excessive use of computers leads to muscular pain which results in inefficiency and higher health expenses to the employees.

What are the various components in Tally?

Tally Screen Components

Title Bar: This is used to display the Tally software that we are using.

Horizontal Button Bar: It helps to choose Keyboard settings, support centre, Language, Control centre, and Help.

Close Button: Click on this close button or use ctrl+m to close the Tally window.

Task Bar: It is used to display the task of Tally ERP 9.

Gateway of Tally: It is used to display the menu, screen, reports.

Info Panel: Information panel is used to display the license details, configuration details, and tally version.

Calculation Area: It is used for calculation functions.

Buttons Tool Bar: It is used to display the buttons that enable for immediate interaction with Tally. It can display only the buttons that are applicable to the current task.

Date and Time: It is used to display the current date and time.

Explain different accounting vouchers in tally

 Payment voucher:Payment voucher in accounting vouchers in tally records all business transactions related to Payment. Any payment made by the company through cash, cheque, online payment or any other mode comes under this voucher type. To record transactions, click Gateway of tally> Transaction> Vouchers> Press F5.

Receipt Voucher:The Receipt voucher under accounting vouchers in tally records all money transactions received by the company. The amount received could be in the form of cash, cheque or online. When an accountant makes a receipt voucher in Tally Prime, all the invoices with pending payments pop up as a reminder. To record this transaction, go to Gateway of tally> Transaction> Vouchers> Press F6.

Contra Voucher:In contra voucher, all the company’s transactions include deposits or money withdrawal from its bank account. The entry is made in this voucher if the amount is transferred from bank to bank or cash to cash. To record such transactions, go to Gateway of tally> Transaction> Vouchers> Press F4.

Purchase Voucher:In this voucher, all the transaction related to company purchases is recorded. The purchase can be made in cash or borrowed or in the form of goods and services. To record the transaction, go to Gateway of tally> Transaction> Vouchers> Press F9.

1.Distinguish between Work Book and Work sheet?

• EXCEL WORKBOOK IS LIKE A BOOK THAT CONTAINS A NUMBER OF PAGES WHILE EXCEL WORKSHEET IS A SINGLE PAGE OR SHEET OF A WORKBOOK LIKE A PAGE IN A BOOK.
• LINKING TWO WORKSHEETS IS MORE EASY THAN LINKING TWO WORKBOOKS. THE EXTERNAL WORKBOOK OR DATA THAT IS LINKED TO MAIN WORKBOOK NEEDS TO BE SECURE AND IN
• CASE OF REMOVAL ITS LINK FROM MAIN WORKBOOK WILL BE REMOVED AUTOMATICALLY.

• WORKBOOK IS NOT A PLACE WHERE WE MANIPULATE WITH DATA. IT IS WORKSHEET OR SPREADSHEET WHERE WE EDIT, WRITE AND SAVE DATA. WORKBOOK IS JUST THE FACE OR COVER OF WORKSHEETS.
• WE CAN ADD AS MANY WORKSHEET AS WE WANT IN A SINGLE WORKBOOK RESTRICTED TO THE MEMORY OF OUR SYSTEM. HOWEVER, WE CAN’T ADD WORKBOOK IN OTHER WORKBOOK EASILY.
• A WORKBOOK IS A PLATFORM THAT HOLDS THE ENTIRE DATA WHILE WORKSHEET IS A PAGE OF THE WORKBOOK THAT IS ACTUALLY HOLDING A SPECIFIC DATA.

Explain the technological advantages of tally?

Data Reliability:The tool is robust that even power failures or machine shut down during functioning does not affect data stored in Tally database. Quality data integrity checks at periodic levels ensure complete data reliability.

Data Security:Data integrity checks also ensure that no external modifications to the data can intervene with Tally. The availability of binary encoding storage format avoids tricky information grouping. Access to database is through an activated ODBC layer.

Tally Audit:A specified user can be given administrator rights to check for correctness of entries entered by authorized users and make changes where required. Audited entries and alterations made are displayed along with the name of the user who has made those modifications with the time of change.

Tally Vault:Data encryption option available in Tally is called the Tally Vault. Data Encryption Standard (DES) method prevents breaking of password for the vault.

Explain the features /characterestics of computerised accounting.

Simple and Integrated: It helps all businesses by automating and integrating all the business activities. Such activities may be sales, finance, purchase, inventory, and manufacturing etc. It also facilitates the arrangement of accurate and up-to-date business information in a readily usable form.

Accuracy & Speed: Computerised accounting has customized templates for users which allows fast and accurate data entry. Thus, after recording the transactions it generates the information and reports automatically.

Scalability: It has the flexibility to record the transactions with the changing volume of business.

Instant Reporting: It can generate a quality report in real time because of high speed and accuracy.

Security: Secured data and information can be kept confidential as compared to the traditional accounting system.

Quick Decision Making: This system Generates real-time, comprehensive MIS reports and ensures access to complete and critical information, instantly.

Reliability: It generates the report with consistency and accuracy