Business Growth App for Tally Users
A Journal voucher in Tally is a crucial voucher in Tally ERP 9 that involves making adjustment entries, entries regarding fixed assets and credit purchases or sales. You need to press the shortcut key "F7" from the accounting vouchers to use Journal Vouchers. There are innumerable examples of journal vouchers which we will be presenting below. By the end of this article, you will have complete knowledge on how to enter Journal vouchers in tally with ease.
A journal is the book of accounts where transactions of financial nature are recorded from the source documents. The transactions are recorded on an actual basis when the transactions take place.
The process of recording financial transactions can be termed journal entries in the books of accounts, known as Journalising. It is based on the Double-Entry system of accounting. This form of accounting or bookkeeping is a system of accounting where every transaction has dual effects. It means that the Debit amount must be equal to the Credit amount for every transaction.
Every transaction requires a piece of documentary evidence like a Journal voucher. Journal Voucher in Tally ERP 9 is used to record transactions other than cash and bank. Transactions related to depreciation, provisions, purchase and sale of fixed assets on credit, write off balances, adjustment entries are recorded in Journal Voucher. It is the most important voucher in accounting vouchers.
You can easily trace these vouchers in any accounting system. Auditors generally use Journal Vouchers during an audit as a part of Audit Procedures. These transactions are of routine nature.
Do you know the reason behind the preparation of Journal Vouchers in tally? Why are they so important? Journal Vouch ers are prepared to serve multi-fold purposes as described below:
Non-cash transactions are those transactions that do not involve a cash payment. For example- depreciation, loss or gain on fixed assets, provision for discount expenses, asset write-downs and deferred income taxes.
There may be situations when the business transactions are wrongfully recorded in the books of accounts. It may be incorrect debit or credit of accounts. Journal Vouchers helps in a reversal of the first entry using a journal entry in Tally ERP 9.
All accounting vouchers record transactions of specific nature or type. Some are described as follows:
Also Read: All About Banking Entry in Tally ERP 9
Every voucher has its respective bifurcation. Journal Vouchers are divided into different types:
There are various examples of recording Journal Vouchers in Tally ERP 9. Some of them are described as follows:
1. Outstanding expenses
Outstanding expenses are those expenses that are due but not paid over the year. It is a liability. For example- Outstanding rent, outstanding salary, outstanding wages and outstanding subscription etc. Let's say wages for the months from January to March are paid during May of the new Financial Year. As per the accrual concept, the expense should be recorded from January to March itself to show the accurate figure of a business.
You can record the Journal entry at the end of March as:
2. Prepaid Expenses
Prepaid expenses are the expenses paid in advance. These expenses haven't occurred in this financial year yet. As per accrual basis, the expenses should be booked in the year to which it pertains. But as per cash basis, we will record this transaction in the year of cash outflow. We will record these expenses as an asset in this financial year to reach an accurate net profit. Let's say I have paid my house rent for the next financial year in this financial year only.
The Journal Entry for the same will be:
3. Accrued Income/ Expense
Accrued Income is an income that is earned but not received. It is a current asset for the organization. For example- accrued interest receivable, accrued rent, accrued salary etc.
Journal entry for accrued income:
Accrued Expense is an expense that is recognised in the books of accounts before it is paid. It is a current liability for the organization. For example- bonus, salary payable, unused sick leaves, accrued interest payable etc.
Journal Entry for Accrued Expense:
4. Credit Purchases or Sales
Credit purchases are made when fixed assets or materials are bought on credit. For example- Mohan bought Plant and Machinery from Sohan on credit for Rupees 10 lakhs.
The journal entry in tally for the transaction will be:
Credit sales are made when fixed assets or materials are sold on credit. For example- Rashi sold Land and Building to Komal on credit for Rupees 15 lakhs.
The tally journal entries for the transaction:
5. Transfer Entries
These Journal Voucher entries in tally are made when you require to transfer funds between different accounts. You can say it as writing off the accounts too. For example- A company has a debtor balance of Rupees 20,000 and a creditor balance of Rupees 25,000. I can write off the debtors from the creditors. It means that my debtors worth Rupees 20,000 can directly pay my creditors worth 20,000 and the values in the books of accounts will be:
The journal entry for the transaction will be:
Also Read: How to Enter Sales Return Entry in Tally ERP 9?
Although these two important terms, “Journal voucher” and “Journal Entry,” are used interchangeably, but, they are different from each other. The following are key differences found between these two:
Passing Journal Entries in Tally through Journal Vouchers is very simple. If one knows the basic accounting rules, they can post the Accounting entries in Tally ERP 9 without serious effort. However, most people have a confusion regarding the basic rules of accounting. You need to clear some concepts regarding:
These are some issues that a layman faces while passing Journal Entries in Tally ERP 9. However, this problem is solvable. You can either refer to the accounting books, website articles and blogs or take the help of an expert or professional. More information can be found in the journal entry in tally ERP pdf.
Journal entries in Tally are posted through journal vouchers. Journal Vouchers are easily accessible by pressing the shortcut key "F7," or you can move your cursor to the Journal Voucher to access the same.
There are some broad steps to enter the journal entries in Tally ERP 9 as described below:
Among these vouchers, select the Journal Voucher or press "F7" on the right side of the screen.
In this way, you can add multiple Journal Vouchers in Tally ERP 9 for the respective transactions.
This was all about tally journal entries. Students can practice the tally journal entry questions with answers using Journal Vouchers. Just go through the basic accounting steps and you are all set to pass the Journal Vouchers in Tally ERP 9.
Check out Biz Analyst for more information and securely using Tally ERP 9.
1. What is a Journal entry in Tally?
Journal Entry in Tally is a recording of financial transactions in the given financial year.
2. What is the Tally Journal Entry for depreciation worth 10,000 rupees charged on Plant and Machinery?
Debit Depreciation Account: 10,000
Credit Plant and Machinery Account: 10,000
3. How do you pass Journal Voucher in Tally?
Press shortcut key "F7" under the accounting vouchers.
Business Growth App for Tally Users