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How does a Business Transaction recorded in Tally.ERP 9?


In general accounting practice first we pass business transactions in Journaland after that we transfer the amount either in Credit or Debit side of the corresponding Ledger Account pertaining to a particular Business Unit (Organization or Firm). After finalization of the Ledger balance within specific period we create Trail Balance of the firm and later prepare the Trading, Profit and Loss Account and Balance Sheet statement. The manual work will be classified as follows.

Image: How Accounting Transactions are recorded in Tally.ERP 9
  1. Drawing up the traditional tabular format for Journal, Ledger Account, Trail Balance, Trading and Profit & Loss Account, and Balance Sheet by keeping the heading as a Business Unit name.
  2. Passing business transactions in Journal with Debit and Credit figures.
  3. Transferring the debit and credit figures to the corresponding Ledger Accounts.
  4. Interpreting the balanced figures of the Ledger Accounts to the Final Account Statements.

The same concept has been interpreted in Tally.ERP 9 Accounting Package but with few alterations. We just do three things in this software i.e. Creating Business Unit (here we called as Company), Creating Ledger Accounts (here called as Ledger), and Passing the entries in Journal (here called as Accounting Voucher Creation). Tally.ERP 9 automatically transfers the figures from Accounting Voucher to Ledger Accounts and as well prepares Trail Balance, Profit and Loss Account and Balance Sheets of the organization. The process is as follows.

  1. Company creation.
  2. Ledger creation, which holds the summary of a specific kind of business transaction.
  3. Accounting Voucher Creation which is similar to passing business transactions in Journal.
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is the founder of AccountsGuy.Net with the view of providing Accounting and Technical support using Accounting package Tally ERP 9, and Office Tools to the people. I write articles on Accounts, Blogging, Computer Operating, and technical issues and some of my experiences on them for students, beginners. Follow our Networks or sing-up for the email newsletter below for your daily dose of Tips and Tricks.
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