Tally Accounting Tutorials for Beginners – 7 Examples – PDF Download

Tally Accounting Tutorials for Beginners - 7 Examples - PDF Download

Tally accounting or accounting in tally is very easy if you learn tally step by step with proper attention and care.

If you know how to use tally, then accounting in tally is the basic skill that you have to learn and that is what I am going to explain in this post.

With the help of different tally tutorials along with examples including GST, you will be able to learn basic accounting in tally.

What you will learn in this post – bullet points

  • Tally Introduction – How to use Tally ERP 9
  • Tally Accounting Software – How accounting works in tally including bookkeeping
  • Tally Entries – basic accounting entries in tally including GST with 7 examples
  • Tally ERP 9 Accounting Tutorials – PDF free download

Introduction to Tally Accounting Tutorials

Accounting in tally is exactly same as manual accounting. It is just that in tally, it is in digital format.

I have said this many times, but let me say this one more time. If you want to learn tally, learn basic accounting and you will learn tally effortlessly.

In this post I will be teaching you about different tally accounting tutorials – in total 7 – which will help you maintain accounting including maintaining your personal accounts in tally.

Even if you are a beginner in Tally ERP 9, accounting in tally is going to be fun if you follow the basic tally tutorials that I am going to explain in this post.

Now, let us look at how accounting works in tally and how you can maintain your accounting books even if you are a beginner in tally.

Even if you are a beginner in Tally ERP 9, accounting in tally is going to be fun if you follow the basic tally tutorials that I am going to explain in this post.

Now, let us look at how accounting works in tally and how you can maintain your accounting books even if you are a beginner in tally.

Tally Accounting Software – How Accounting Works in Tally including Bookkeeping

There are different types of accounting entries and therefore in tally, they are divided according to their functions.

For example, if you sell something, there is a special voucher in tally called sales voucher and we can use that to pass a sales entry in tally.

Similarly, for different types of transactions we can use different accounting vouchers in tally.

Now, you must be thinking – how exactly accounting works in tally?
How to maintain books of accounts like profit and loss account, balance sheet, sales register etc in tally?

Well, I am going to explain how the entire process of accounting in tally works to you. Here is how.

Step – 1 – Identifying & Creating Basic Accounting Ledgers in Tally

Before we pass an accounting entry, we need to create ledgers for that accounting entry in tally.

Let’s say for example, you deposited ₹1,000 in your bank account. Now, in this entry 2 ledgers are used.

They are – Cash and Bank Account.

You deposited cash in your bank account. So, your cash balance will be reduced by ₹1,000 and your bank balance will increase by ₹1,000.

Right now, don’t think about what kind of entry is this or what will be debit and what will be credit.

Currently at this step of an accounting entry, you only need to identify the accounting ledgers that will be used. That’s it.

Once you learn to identify the accounting ledgers in an entry, you will see, it will be much easier for you to actually pass an accounting entry in tally.

The above example was very simple and you need to practice with at least 500 transactions like that to get to a level where you will not have to think anymore about the accounting ledgers.

It will just automatically come in your mind like it comes in my mind. 🙂

Please go to this post in which I have explained in detail about how to create ledgers in tally.

Now, let’s move ahead to the second step when you need to think about debit and credit.

Step – 2 – What will be Debit & What will be Credit

Let us take above accounting entry of bank transaction here and see what will be debit and what will be credit in tally.

It is actually very simple. Right now, just remember this:

Whatever comes in your business will be debit.
Whatever goes out of your business will be credit.

So, in the above transaction, you deposited ₹1,000 in your bank account. Therefore, money in the form of cash comes in the bank account.

So, bank account will be debited here.

Similarly, money goes out from your business in the form of cash to the bank account.
Therefore, cash account will get credited.

Remember this golden rule of accounting – debit what comes in and credit what goes out.

So the accounting entry will be:

Bank Account Dr ₹1,000
To Cash Account ₹1,000

In accounting, we often write To in the beginning of the ledger which is going to be credited. This is just another way of writing accounting entries and nothing else.

Look at the picture in tally below for the exact same entry.

Identifying debit and credit in tally
Identifying debit and credit in tally

Let’s move on to the third step which is actually fun because you do not have to do anything here.

Step – 3 – Checking the Accounting Entries in Tally

The best thing about tally is that once you have done the accounting entries, you do not have to create anything else.

Tally automatically does it for you.

Once you complete and save the accounting entry in tally, every other effect will take place in every accounting report and necessary books.

So, you can now go in the balance sheet in tally and see the increased bank balance by ₹1,000 and reduced cash balance by ₹1,000.

Similarly, you can also go to the day book in tally and you will find this transaction today.

In other words, bookkeeping in tally is done automatically. You only have to do the accounting in tally and the rest it taken care of by tally.

Now, let’s move to the next part which is about basic accounting entries in tally for beginners including GST and with examples.

Tally Entries – Basic Accounting Entries in Tally including GST – 7 Examples

This can also be called as tally accounting tutorials for beginners.

We are going to look at basic accounting entries in tally with which you can start learning tally and maintain accounting in tally.

At the end of these basic accounting entries, you will be easily able to do accounting in tally with GST.

Basic tally accounting entries are:

  1. Contra Entry in Tally
  2. Payment Entry in Tally
  3. Receipt Entry in Tally
  4. Journal Entry in Tally
  5. Sales Entry in Tally with GST
  6. Purchase Entry in Tally with GST
  7. Year End Closing Entries in Tally

Let’s start with Contra Entry in Tally.

Contra Entry in Tally

We have already seen one of the contra entries in tally above, when we deposited ₹1,000 in the bank account.

Contra entry will be used in 3 circumstances:

  1. Transfer of money from cash to bank account – we have already seen this in the example above.
  2. Transfer of money from bank account to cash i.e. cash withdrawal
  3. Transfer of money from one bank account to another bank account i.e. inter-bank transfer

Now, we will see transfer of money from bank account to cash i.e. cash withdrawal entry in tally.

Tally Accounting Entry – Example 1

You have withdrawn ₹5,000 from your bank account. For this, we will use contra voucher in tally.

You can go to contra voucher in tally by going into accounting vouchers from gateway of tally and then selecting contra from the right hand side options.

The accounting entry for the above transaction will be as under in tally:

Contra Entry in Tally ERP 9
Contra Entry in Tally ERP 9

Cash Account Dr ₹5,000
To Bank Account ₹5,000

Now, we are going to look at the second point which is a payment entry in tally.

Payment Entry in Tally

Whenever you make a payment to someone, it will be done in payment voucher in tally.

Tally Accounting Entry – Example 2

Let’s take an example. You made a payment of ₹2,000 in cash to Radhika because you have purchased goods from her.

You can select payment voucher which is exactly under the option of contra voucher in tally.

Or you can just press F5 while in accounting vouchers which is the shortcut for payment voucher in tally.

Payment entry for the above transaction will be as under:

Radhika Account Dr ₹2,000
To Cash Account ₹2,000

Payment Voucher in Tally ERP 9
Payment Voucher in Tally ERP 9

Now, let us move forward and we will look at the third point which is the receipt entry in tally.

Receipt Entry in Tally

In the above transaction, you made a payment to someone. In the same way, whenever you receive money from someone, we have to use receipt voucher in tally for that.

Tally Accounting Entry – Example 3

Let’s say for example, you received ₹3,500 from Priya in bank account because you sold some goods to her.

You can go to the receipt voucher in tally easily because it is just under the payment voucher option in tally.

Receipt entry in tally for the above transaction will be as under:

Bank Account Dr ₹3,500
To Priya’s Account ₹3,500

Receipt Voucher in Tally ERP 9
Receipt Voucher in Tally ERP 9

This is how simple it is to pass a receipt entry in tally.

Before we move on to journal entry in tally, I want you to understand a basic understanding behind tally accounting because it is very much important.

Basic understanding behind accounting in tally is that for every kind of transaction, there is a different kind of voucher. Please remember this.

Now, we will move forward to the fourth point which is about journal entry in tally.

Journal Entry in Tally

In general, journal entry is used when there is no cash or bank account involved.

However, you can still pass a journal entry with cash and bank account in a journal voucher in tally. That is an unique feature of a journal voucher in tally.

The option of journal voucher in tally is located exactly under the option of receipt voucher in tally.

Tally Accounting Entry – Example 4

Let’s take an example of depreciation which is a commonly used accounting entry for any business.

You have a computer in your business which is of ₹20,000 and this year, the depreciation will be 60% which comes to be ₹12,000.
We will pass a journal entry in tally for the above transaction in tally. Accounting entry will be as follows:

Depreciation Account Dr. ₹12,000
To Computer Account ₹12,000

In tally, it will look like in the image below.

Journal Voucher in Tally ERP 9
Journal Voucher in Tally ERP 9

We can also pass the contra entry in the first point of this post in the journal voucher in tally. Right now, try it in your computer.

Now, we will move on to our next point which is sales entry in tally with GST.

Sales Entry in Tally with GST

Whenever you sell something, you can use either a journal voucher or a sales voucher in tally.

I always recommend sales voucher because it is much easier to record a sales entry in a sales voucher in tally than a journal voucher.

In Tally, you can find the option of sales voucher just below the option of journal voucher.

Tally Accounting Entry – Example 5

Let’s say, for example, you sold some goods worth ₹3,500 to Priya including GST.

The sales entry for the above transaction with GST in a sales voucher in tally will look like in the image below.

Sales Entry in Tally with GST
Sales Entry in Tally with GST

The transaction above is inclusive of GST which we generally have in the business and you can do it very easily in tally.

Now, we will move on to the next entry which is purchase entry in tally with GST.

Purchase Entry in Tally with GST

You can pass a purchase entry in tally in purchase voucher as well as journal voucher.

But, I recommend using purchase voucher while passing a purchase entry in tally because it is much easier than a journal entry. It looks as if you are creating an invoice and along with that you will also do the accounting.

This is the beauty of tally. I have created a post where I had mentioned how an accountant can save a lot of time by installing tally at the client’s place.

Tally Accounting Entry – Example 6

Let’s say, for example, you purchased some goods worth ₹2,000 from Radhika in cash plus GST.

Accounting in tally for the above transaction will look like in the image below.

Purchase Entry in Tally with GST
Purchase Entry in Tally with GST

Whenever we purchase something, we select a purchase voucher in tally and it is located under the credit note voucher option in tally.

Please go to the below posts if you want to learn purchase entries with GST in detail with different rates of GST in a single bill.

  1. Multiple GST Rate Invoice in Tally
  2. GST Accounting Entries in Tally
  3. Create Sales and Purchase Vouchers in Tally

Now, we are going to look at the last point which is year end closing entries in tally.

After understanding this point, you will be easily able to do accounting in tally for majority of the persons.

Year End Closing Entries in Tally

At the end of the year, we need to close all the current accounts in order to finalize the accounts for that particular year.

In tally, you don’t need to carry forward all the transactions to the new year. They are automatically carried forward.

You just have to change the date to the new year and that’s it.

Coming back to the year end closing entries in tally, you have to pass simple journal entries to close all the current accounts which we are not going to carried forward for the next year.

Current accounts are the accounts that are current and short term in nature and not long term.

For example, any kind of expenses are short term in nature and therefore they are current accounts.

If you purchase a computer which is generally a fixed asset, it will be used for long term and therefore it is not a current account.

In simple words, current accounts only relate to the current year. Any kind of expenses or incomes which are related to the current year will be closed at the end of the year.

Tally Accounting Entry – Example 7

In this example, we will close the year end entry for office expenses in tally.

Let’ say, there are depreciation expenses of ₹12,000 for the year in the profit and loss account.

If you remember, we have already created a journal entry for depreciation of ₹12,000. We will close that in this example.

Ideally, we will close the profit and loss account itself but for this example, let us assume that we will close depreciation account.

Journal entry in tally for the above transaction will be as under:

Capital Account Dr ₹12,000
To Depreciation Account ₹12,000

Year End Closing Entry in Tally ERP 9
Year End Closing Entry in Tally ERP 9

Let me explain this entry a little bit. We start a business with capital. At the end, after a profit or a loss, it is capital at which we look at.

Therefore, at the end of the year, we close all the current accounts into the capital account to see the final result at the end of the year.

That’s why, we use capital account while passing the year end closing entries and that is what we have done in the above accounting entry in tally.

Tally ERP 9 Accounting Tutorials – PDF Free Download

You can download the PDF file of this post so you can use it as a guide whenever you want to do accounting in tally.

Download Tally Accounting Tutorials PDF

Accounting Tutorials for Beginners – Video

Conclusion

If you look at the 7 points that we have discussed in this post, it is a step by step guide to your accounting in tally.

Once you go through all the seven points along with the examples, you will see that you will know much more about tally in accounting than before.

It is that simple to understand and do accounting in tally.

We have looked at all the necessary tally entries to get you kick started with accounting and bookkeeping in tally.

This is how you should learn Tally ERP 9. Simple, sweet and easy.

If you have any questions or suggestions, please feel free to comment down below. I reply to each and every comment.

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