First Create a new company named Royal Trading & Co
2. After Company Creation > First Create the following ledgers >
Ledger Name
Group
Debit (₹)
Credit (₹)
Ramu Capital Account
Capital Account
10000
Cash in Hand
Cash-in-Hand
10000
3. Gateway of Tally > Masters : Create > Ledgers:
4. Enter Name : Ramu Capital A/c — Under : Type Cap and Select Right Side Using Arrow Keys or Select and Enter Capital Account > and Give Opening Balance : 10000 Cr. > Accept Yes >
5. Now you will see the Same Ledger creation > Press Escape twice and Goto Gateway of Tally >
6. Gateway of Tally > Master : Alter > Ledgers > Select Cash > Opening Balance : 10000 Dr.
7. So Ramu is Giver and Cash is Comes in to Business . So Cr. Ramu Capital A/c and Dr. Cash A/c
8. Go Gateway of Tally > Go Balance Sheet > You Can See Liabilities / Current Assets Statement
9. Go Gateway of Tally > Go Profit and Loss A/c > No Profit and Loss Data because no entry made in any purchase or sales
10. Go Gateway of Tally > Go Display More Reports or Press D > Go Trail Balance > and Press F5 (Ledger Wise / Group wise breakup)
11. Now Add the following Ledger
Ledger Name
Group
Debit (₹)
Credit (₹)
Cash Purchase A/c
Purchase
5000
Go Gateway of Tally > Enter Name : Cash Purchase A/c — Under : Select Purchase Account > and Give Opening Balance : 5000 Cr. > Accept Yes >
Gateway of Tally > Master : Alter > Ledgers > Select Cash > Opening Balance : 5000 Dr. (Because Amount to be reduced due to Cash purchase Rs.5000)
12. Now Go the Step No 8 , 9, 10 (See the changes in Profit and Loss and Balance sheet , now net loss Because Only Cash Purchase Not Sales ..)
13. Now Add the following Ledger
Ledger Name
Group
Debit (₹)
Credit (₹)
Cash Sales A/c
Sales
20000
Go Gateway of Tally > Master > Create : Ledgers > Enter Name : Cash Sales A/c — Under : Select Sales Account > and Give Opening Balance : 20000 Dr. > Accept Yes >
Gateway of Tally > Master : Alter > Ledgers > Select Cash > Opening Balance : 25000 Dr. (Because Amount to be raised due to Cash Sales Rs.20000)
14. Now Go the Step No 8 , 9, 10 (See the changes in Profit and Loss and Balance sheet)
Profit and Loss A/c
Balance Sheet
Trail Balance
13. Now Add the following Ledger
Ledger Name
Group
Debit (₹)
Credit (₹)
Furniture
Fixed Asset
5000
Telephone Charges
Indirect Expenses
1000
Electricity Bill Paid
Indirect Expenses
500
Total
6500
14. Go Gateway of Tally > Master > Create : Ledgers > Name : Furniture — Under : Fixed Asset > and Give Opening Balance : 5000 Dr. > Accept Yes >
15. Name : Telephone Charges — Under : Indirect Expenses > and Give Opening Balance : 1000 Dr.
16. Name : Electricity Bill Paid — Under : Indirect Expenses > and Give Opening Balance : 500 Dr.
17, Gateway of Tally > Master : Alter > Ledgers > Select Cash > Opening Balance : 18500 Dr. (Because Amount to be reduced due to Expenses (25000- 6500 = 18500 Dr.)
18. Now Go the Step No 8 , 9, 10 (See the changes in Profit and Loss and Balance sheet)
For a service-oriented organization using Tally Prime, the ledger and group setup will focus on managing revenue from services, handling expenses, and tracking other financial activities specific to service-based operations. Here’s a structured approach for setting up these ledgers and groups:
1. Groups
Group Name
Description
Sundry Debtors
Ledgers for clients or customers who owe payment for services rendered.
Sundry Creditors
Ledgers for suppliers or service providers.
Income
Revenues from various services provided.
Expenses
Various expenses including operational and administrative costs.
Fixed Assets
Assets such as office equipment and furniture.
Cash
Cash transactions and balances.
Bank
Transactions related to bank accounts.
2. Ledgers
Group
Ledger Name
Description
Sundry Debtors
Client A Receivables
Ledger for a specific client who owes payment.
Client B Receivables
Ledger for another client.
Sundry Creditors
Supplier A
Ledger for a specific supplier (e.g., office supplies).
Service Provider A
Ledger for service providers (e.g., IT support, consultancy).
Income
Service Income
Revenue from the services provided (e.g., consulting fees).
Project Income
Revenue from specific projects or contracts.
Other Income
Other sources of income (e.g., interest, miscellaneous revenue).
Expenses
Salaries and Wages
Salaries and wages for employees and contractors.
Rent
Expense for renting office space.
Utilities
Costs for utilities like electricity and water.
Office Supplies
Costs for office supplies and materials.
Travel Expenses
Costs related to travel for business purposes.
Professional Fees
Costs for professional services (e.g., legal, accounting).
Fixed Assets
Office Equipment
Ledger for office equipment (e.g., computers, printers).
Furniture
Ledger for office furniture.
Leasehold Improvements
Ledger for improvements made to leased premises.
Cash
Petty Cash
Small cash transactions and expenses.
Bank
Bank Account 1
Ledger for a specific bank account.
Bank Account 2
Ledger for another bank account.
This setup helps service-oriented organizations track their revenue from services, manage expenses related to operations, and maintain accurate records of financial transactions.
2) For retail or supermarkets
For retail or supermarkets using Tally Prime, organizing ledgers and groups in a table format can help manage various aspects of financial transactions and inventory. Here’s a structured view of how you might set up ledgers and groups for a retail or supermarket business:
1. Groups
Group Name
Description
Sundry Debtors
Ledgers for customers who owe money for purchased goods.
Sundry Creditors
Ledgers for suppliers/vendors to whom payments are owed.
Stock-in-Hand
Manages inventory or stock.
Sales
Revenue from sales transactions.
Purchases
Costs related to buying inventory.
Indirect Expenses
Expenses not directly tied to goods sold (e.g., rent, utilities).
Direct Expenses
Expenses directly related to the purchase of inventory (e.g., freight).
Fixed Assets
Assets used in the business such as machinery and furniture.
Cash
Cash transactions and balances.
Bank
Transactions related to bank accounts.
2. Ledgers
Group
Ledger Name
Description
Sundry Debtors
Customer A
Individual customer ledger.
Customer B
Another customer ledger.
Sundry Creditors
Supplier A
Ledger for a specific supplier.
Supplier B
Ledger for another supplier.
Stock-in-Hand
Groceries
Ledger for groceries stock.
Electronics
Ledger for electronic goods stock.
Sales
Cash Sales
Revenue from cash sales.
Credit Sales
Revenue from sales on credit.
Purchases
Inventory Purchase
Cost of purchasing inventory.
Freight Charges
Costs related to transporting goods.
Indirect Expenses
Rent
Expense for renting store premises.
Utilities
Expenses for utilities like electricity and water.
Office Supplies
Costs for office-related supplies.
Direct Expenses
Purchase Freight
Freight charges directly related to purchasing goods.
Packaging Costs
Costs for packaging materials.
Fixed Assets
Store Equipment
Ledger for equipment like cash registers, shelves, etc.
Furniture
Ledger for store furniture.
Cash
Petty Cash
Small cash transactions and expenses.
Bank
Bank Account 1
Ledger for a specific bank account.
Bank Account 2
Ledger for another bank account.
This setup will help you track sales, purchases, inventory, expenses, and bank transactions efficiently, making it easier to manage and report on the financial aspects of a retail or supermarket business.
3) For Manufacturing companies
For manufacturing companies using Tally Prime, the ledger and group setup will focus on tracking production costs, inventory, and other operational expenses. Here’s how you might organize these ledgers and groups in a table format:
1. Groups
Group Name
Description
Sundry Debtors
Ledgers for customers who owe money for goods sold.
Sundry Creditors
Ledgers for suppliers/vendors from whom materials are purchased.
Stock-in-Hand
Manages inventory of raw materials, work-in-progress, and finished goods.
Sales
Revenue from sales of finished products.
Purchases
Costs related to buying raw materials and other inputs.
Direct Expenses
Expenses directly related to production (e.g., direct labor, raw materials).
Indirect Expenses
Expenses not directly tied to production (e.g., rent, utilities).
Fixed Assets
Assets used in manufacturing such as machinery and equipment.
Cash
Cash transactions and balances.
Bank
Transactions related to bank accounts.
2. Ledgers
Group
Ledger Name
Description
Sundry Debtors
Customer A
Individual customer ledger.
Customer B
Another customer ledger.
Sundry Creditors
Supplier A
Ledger for a specific supplier.
Supplier B
Ledger for another supplier.
Stock-in-Hand
Raw Materials
Ledger for raw materials used in production.
Work-in-Progress
Ledger for partially completed products.
Finished Goods
Ledger for finished products ready for sale.
Sales
Domestic Sales
Revenue from sales within the country.
Export Sales
Revenue from sales to other countries.
Purchases
Raw Material Purchases
Cost of purchasing raw materials.
Packing Material Purchases
Cost of packing materials.
Direct Expenses
Direct Labor
Wages and salaries directly tied to production.
Production Supplies
Costs for supplies used directly in manufacturing.
Indirect Expenses
Rent
Expense for renting factory or office space.
Utilities
Costs for utilities such as electricity, water, etc.
Administrative Expenses
Costs related to administrative functions.
Fixed Assets
Machinery
Ledger for machinery used in production.
Equipment
Ledger for production equipment.
Cash
Petty Cash
Small cash transactions and expenses.
Bank
Bank Account 1
Ledger for a specific bank account.
Bank Account 2
Ledger for another bank account.
This setup helps track the various aspects of manufacturing operations, including inventory management, production costs, sales, and financial transactions, making it easier to manage and analyze financial data.
4) For schools and Collages
For schools using Tally Prime, the ledger and group setup will focus on managing finances related to tuition fees, salaries, utilities, and other school-related expenses. Here’s how you might organize these ledgers and groups in a table format:
1. Groups
Group Name
Description
Sundry Debtors
Ledgers for students or parents who owe tuition fees.
Sundry Creditors
Ledgers for vendors or suppliers providing services or materials.
Income
Revenue from sources like tuition fees and donations.
Expenses
Various expenses incurred by the school.
Fixed Assets
Assets such as buildings, furniture, and equipment.
Cash
Cash transactions and balances.
Bank
Transactions related to bank accounts.
2. Ledgers
Group
Ledger Name
Description
Sundry Debtors
Student Fees Receivable
Ledger for tracking tuition fees owed by students.
Parent Fees Receivable
Ledger for fees receivable from parents.
Sundry Creditors
Supplier A
Ledger for a specific supplier (e.g., stationery supplier).
Service Provider A
Ledger for service providers (e.g., cleaning services).
Income
Tuition Fees
Revenue from student tuition fees.
Donations
Income from donations and grants.
Miscellaneous Income
Other sources of income (e.g., event fees).
Expenses
Salaries and Wages
Salaries and wages for teachers and staff.
Utilities
Expenses for electricity, water, and other utilities.
Stationery and Supplies
Costs for educational supplies and stationery.
Maintenance Costs
Expenses for maintaining school facilities.
Fixed Assets
Building
Ledger for school buildings and property.
Furniture and Fixtures
Ledger for classroom and office furniture.
Educational Equipment
Ledger for equipment like computers, projectors, etc.
Cash
Petty Cash
Small cash transactions and expenses.
Bank
Bank Account 1
Ledger for a specific bank account.
Bank Account 2
Ledger for another bank account.
This setup helps schools manage their financial transactions efficiently, including tracking income from tuition fees, managing expenses related to operations, and handling bank and cash transactions.
5) For government organizations
For government organizations using Tally Prime, the ledger and group setup will focus on managing public funds, tracking expenditures, handling revenues, and maintaining transparency. Here’s a structured approach for setting up these ledgers and groups:
1. Groups
Group Name
Description
Sundry Debtors
Ledgers for receivables from other government entities or departments.
Sundry Creditors
Ledgers for payments owed to suppliers and contractors.
Income
Revenues from various sources such as grants, taxes, and fees.
Expenditure
Various expenditures including operational and project costs.
Fixed Assets
Assets like buildings, equipment, and infrastructure.
Cash
Cash transactions and balances.
Bank
Transactions related to bank accounts.
2. Ledgers
Group
Ledger Name
Description
Sundry Debtors
Receivables from Department A
Amounts receivable from other government departments.
Receivables from External Agencies
Amounts receivable from external entities or agencies.
Sundry Creditors
Supplier A
Ledger for a specific supplier or contractor.
Service Provider A
Ledger for service providers (e.g., maintenance services).
Income
Grants and Subsidies
Revenue from grants and subsidies provided by higher authorities.
Tax Revenues
Revenues from various taxes (e.g., property tax, sales tax).
Fees and Charges
Income from fees for services provided (e.g., registration fees).
Costs related to specific government projects or initiatives.
Maintenance Costs
Expenses for maintaining government properties and equipment.
Fixed Assets
Buildings
Ledger for government buildings and infrastructure.
Office Equipment
Ledger for office equipment and furniture.
Vehicles
Ledger for government vehicles.
Cash
Petty Cash
Small cash transactions and expenditures.
Bank
Bank Account 1
Ledger for a specific bank account.
Bank Account 2
Ledger for another bank account.
This setup ensures that government organizations can effectively manage their finances, track revenue and expenditures, and maintain transparency and accountability in their financial reporting.
6) For municipalities, corporations, or town panchayats
For municipalities, corporations, or town panchayats using Tally Prime, the ledger and group setup will help manage public funds, track expenditures, and handle various local government functions. Here’s how you might organize these ledgers and groups:
1. Groups
Group Name
Description
Sundry Debtors
Ledgers for amounts receivable from residents and businesses (e.g., property tax arrears).
Sundry Creditors
Ledgers for payments owed to suppliers, contractors, and service providers.
Income
Revenues from various sources such as taxes, fees, and grants.
Expenditure
Various expenditures including operational costs and project expenses.
Fixed Assets
Assets like buildings, equipment, and infrastructure.
Cash
Cash transactions and balances.
Bank
Transactions related to bank accounts.
2. Ledgers
Group
Ledger Name
Description
Sundry Debtors
Property Tax Receivables
Amounts receivable from property owners for taxes.
Water Charges Receivable
Amounts receivable from residents for water charges.
Municipal Fees Receivable
Amounts receivable from various municipal services.
Sundry Creditors
Supplier A
Ledger for a specific supplier (e.g., for materials or services).
Contractor A
Ledger for contractors providing construction or maintenance services.
Service Provider A
Ledger for service providers (e.g., waste management, street cleaning).
Income
Property Tax Income
Revenue from property taxes.
Water Revenue
Revenue from water charges.
Service Fees
Income from various municipal services (e.g., permits, licenses).
Grants and Subsidies
Income from grants and subsidies received from higher authorities.
Costs for maintaining public infrastructure and facilities.
Project Expenses
Expenses for specific municipal projects (e.g., road construction).
Fixed Assets
Buildings
Ledger for municipal buildings and facilities.
Street Lighting
Ledger for street lighting infrastructure.
Public Equipment
Ledger for equipment used for public services (e.g., vehicles).
Cash
Petty Cash
Small cash transactions and expenditures.
Bank
Bank Account 1
Ledger for a specific bank account.
Bank Account 2
Ledger for another bank account.
This setup will help municipalities, corporations, or town panchayats manage their financial activities efficiently, track income and expenditures, and maintain effective control over public funds and assets.
7) For trading companies
For trading companies using Tally Prime, the ledger and group setup will focus on managing inventory, sales, purchases, and related financial transactions. Here’s how you might organize these ledgers and groups:
1. Groups
Group Name
Description
Sundry Debtors
Ledgers for customers who owe money for goods sold.
Sundry Creditors
Ledgers for suppliers from whom inventory is purchased.
Stock-in-Hand
Manages inventory of goods for resale.
Sales
Revenue from sales transactions.
Purchases
Costs related to buying inventory.
Direct Expenses
Expenses directly tied to the procurement and sale of goods.
Indirect Expenses
Expenses not directly tied to the sale of goods (e.g., rent, utilities).
Fixed Assets
Assets such as buildings, furniture, and equipment.
Cash
Cash transactions and balances.
Bank
Transactions related to bank accounts.
2. Ledgers
Group
Ledger Name
Description
Sundry Debtors
Customer A
Ledger for a specific customer.
Customer B
Ledger for another customer.
Sundry Creditors
Supplier A
Ledger for a specific supplier.
Supplier B
Ledger for another supplier.
Stock-in-Hand
Inventory – Goods
Ledger for tracking goods available for sale.
Raw Materials
Ledger for raw materials if involved in manufacturing.
Sales
Domestic Sales
Revenue from sales within the country.
Export Sales
Revenue from sales to other countries.
Purchases
Inventory Purchases
Cost of purchasing goods for resale.
Freight Charges
Cost of transporting goods.
Direct Expenses
Purchase Expenses
Costs directly related to purchasing inventory (e.g., freight, handling).
Packaging Costs
Costs for packaging materials.
Indirect Expenses
Rent
Expense for renting office or warehouse space.
Utilities
Costs for utilities such as electricity and water.
Office Supplies
Costs for office-related supplies.
Advertising
Costs for advertising and marketing.
Fixed Assets
Building
Ledger for buildings and real estate.
Furniture and Fixtures
Ledger for office furniture and fixtures.
Equipment
Ledger for machinery and other equipment.
Cash
Petty Cash
Small cash transactions and expenditures.
Bank
Bank Account 1
Ledger for a specific bank account.
Bank Account 2
Ledger for another bank account.
This setup will help trading companies manage their financial transactions effectively, keep track of inventory and sales, and handle both direct and indirect expenses.
Organizations can be classified into various types based on their structure, ownership, and objectives. Here’s an overview of different types of organizations:
Sole Proprietorship Description: Owned and operated by a single individual. Characteristics: Simple to set up, owner has complete control, unlimited liability. Examples: Local small businesses, freelance professionals.
Partnership Description: Owned by two or more individuals who share profits and responsibilities. Characteristics: Shared management, limited liability (in limited partnerships), profits and losses shared as per the partnership agreement. Examples: Law firms, accounting firms, medical practices.
Limited Liability Partnership (LLP) Description: A partnership where some or all partners have limited liabilities. Characteristics: Combines elements of partnerships and corporations, protects individual partners from personal liability. Examples: Professional services firms, startups.
Private Limited Company (Ltd) Description: A privately held company with limited liability. Characteristics: Owned by a small group of investors, shares are not publicly traded, limited liability for shareholders. Examples: Small to medium-sized enterprises, family businesses.
Public Limited Company (PLC) Description: A company whose shares are traded on a stock exchange and are available to the public. Characteristics: Limited liability, can raise capital by issuing shares, regulated by stock exchange laws. Examples: Large corporations like Apple, Microsoft.
Non-Profit Organization (NPO) Description: An organization that operates for charitable, educational, or other socially beneficial purposes rather than for profit. Characteristics: Exempt from income taxes, must reinvest surplus funds into the organization’s mission. Examples: Charities, foundations, educational institutions.
Cooperative Description: An organization owned and operated by its members, who share the profits or benefits. Characteristics: Members have equal voting rights, profits are distributed among members. Examples: Agricultural cooperatives, credit unions, housing cooperatives.
Government Organization Description: Entities created and operated by the government to provide public services. Characteristics: Funded by taxpayer money, not-for-profit, serves public interests. Examples: Public schools, municipal services, government agencies.
State-Owned Enterprise (SOE) Description: A business owned and operated by the government. Characteristics: May operate like a private corporation but is controlled by government policies. Examples: National airlines, utilities companies.
Joint Venture Description: A business arrangement where two or more parties agree to pool their resources for a specific project or purpose. Characteristics: Shared risk and reward, separate legal entity, typically for a limited time. Examples: Collaborative projects between companies, international business collaborations.
Franchise Description: A business model where an individual or group is granted the right to operate a business using the branding and business model of an established company. Characteristics: Franchisee operates independently but under the franchisor’s brand and guidelines. Examples: Fast-food chains like McDonald’s, retail stores like 7-Eleven.
Social Enterprise Description: An organization that applies commercial strategies to maximize improvements in human and environmental well-being. Characteristics: Focuses on social impact rather than profit, often reinvests profits to achieve social goals. Examples: Fair trade companies, businesses addressing social issues.
Mutual Benefit Association Description: An organization formed to provide benefits to its members, such as insurance or financial support. Characteristics: Members contribute to a common fund and receive benefits based on their contributions. Examples: Insurance companies, professional associations. Summary These types of organizations vary widely in their structure, purpose, and operational characteristics, and understanding these differences can help in recognizing their unique roles in the economy and society.
Ledger is like a detailed record or account that tracks all transactions related to a specific item or entity.
Think of it as a notebook where you write down everything that happens related to one thing, like all the money you spend on rent or all the sales you make.
Examples:
Cash Ledger: Tracks all cash transactions (money coming in and going out).
Sales Ledger: Tracks all the sales made by the business.
Salary Ledger: Tracks the payments made to employees.
What is a Group?
Group is a category that helps organize ledgers in Tally Prime.
It’s like a folder where similar types of ledgers are kept together. This makes it easier to manage and find them.
Groups help Tally Prime understand what kind of transactions are recorded in each ledger.
Examples:
Capital Account: This is a group of ledgers involving owners’ investment in the business.
Sundry Debtors: These are the various individuals or firms from whom the business has to recover.
Fixed Assets: A group containing ledgers for items owned by the business, like furniture or any type of machinery.
Why Use Ledgers and Groups?
Organized Record-Keeping: By using ledgers and groups, you can keep your financial records organized and easy to understand.
Accurate Reporting: Tally Prime can generate accurate financial reports, like balance sheets and profit & loss statements, based on the information in ledgers.
Simplifies Management: Groups help you manage similar accounts together, making it easier to analyze the financial health of the business.
Ledgers as a Diary:
This is how one can understand what a ledger is. A ledger is just like a diary where one writes everything concerning a particular subject. For example, you have a daily journal where you write down all your daily expenses. For example, you have a daily journal in which you write down all your expenses each day. Every page may be allocated to various spends one makes, such as food, travel, or entertainment.
Groups as Categories:
Now, these pages in your diary will be divided based on sections or categories. For example, you can have “Food,” another “Travel,” and another “Entertainment.” Then within each category, there are those sheets of pages where you write down the specifics. In accounting, these categories are termed “Groups”, with the sheets being “Ledgers.”
Example:
For example, one group could be “Expenses,” while sub-ledgers might include “Rent,” “Groceries,” or “Utilities.” All the transactions related to each particular expense would then be noted in its corresponding ledger.
In Tally Prime, there are a total of 28 predefined groups. These groups are used to classify and organize ledgers according to their nature and purpose. Here’s a breakdown:
15 Primary Groups
These are the main groups under which all other groups and ledgers are classified.
Capital Account
Reserves & Surplus
Loans (Liability)
Current Liabilities
Current Assets
Fixed Assets
Investments
Branch/Divisions
Miscellaneous Expenses (Asset)
Suspense Account
Sales Accounts
Purchase Accounts
Direct Incomes
Direct Expenses
Indirect Incomes
13 Subgroups
These subgroups are categorized under the primary groups:
Sundry Creditors (Under Current Liabilities)
Sundry Debtors (Under Current Assets)
Cash-in-Hand (Under Current Assets)
Bank Accounts (Under Current Assets)
Loans & Advances (Asset) (Under Current Assets)
Duties & Taxes (Under Current Liabilities)
Provisions (Under Current Liabilities)
Stock-in-Hand (Under Current Assets)
Deposits (Asset) (Under Current Assets)
Secured Loans (Under Loans (Liability))
Unsecured Loans (Under Loans (Liability))
Branch/Division (Under Capital Account)
Suspense Account (Under Current Liabilities)
Custom Groups
You can also create custom groups based on specific business needs. These custom groups can be placed under any of the primary groups listed above.
Activity :
After Company Creation > Gateway to Tally > Under Masters > H: Chart of Accounts >Groups :
Here’s a detailed explanation of all 28 groups in Tally Prime, along with examples of ledgers that fall under each group:
1. Capital Account
Purpose: Tracks the owner’s equity or investment in the business and any withdrawals.
Examples:
Capital Ledger: Represents the owner’s investment.
Drawings Ledger: Tracks money withdrawn by the owner for personal use.
Amutha Capital a/c
Owner Name Capital A/c
2. Reserves & Surplus
Purpose: Represents accumulated profits retained in the business or any reserves.
Examples:
General Reserve Ledger: A reserve fund for future contingencies.
Profit & Loss Account: If there’s a profit carried forward from previous years.
3. Loans (Liability)
Purpose: Tracks borrowed funds that the business needs to repay.
Examples:
Bank Loan Ledger: Records loans taken from banks.
Debenture Ledger: Tracks money raised through debentures.
4. Current Liabilities
Purpose: Represents short-term obligations or debts that the business must pay within a year.
Examples:
Sundry Creditors Ledger: Money owed to suppliers or vendors.
Outstanding Expenses Ledger: Expenses that have been incurred but not yet paid.
5. Current Assets
Purpose: Represents assets that can be converted into cash within a year.
Examples:
Sundry Debtors Ledger: Tracks amounts receivable from customers.
Cash Ledger: Records all cash transactions.
6. Fixed Assets
Purpose: Represents long-term assets that the business owns, like property, machinery, etc.
Examples:
Building Ledger: Tracks the value of buildings owned.
Machinery Ledger: Represents the value of machinery used in the business.
7. Investments
Purpose: Tracks investments made by the business in other companies, stocks, bonds, etc.
Examples:
Shares Ledger: Records the purchase of shares in other companies.
Government Bonds Ledger: Tracks investments in government bonds.
8. Branch/Divisions
Purpose: Used to track accounts for different branches or divisions within the same company.
Examples:
Branch A Ledger: Records transactions specific to Branch A.
Division 1 Ledger: Tracks transactions related to a specific division within the company.
9. Miscellaneous Expenses (Asset)
Purpose: Represents expenses that are deferred and written off over a period of time.
Examples:
Preliminary Expenses Ledger: Records expenses incurred during the formation of the company.
Deferred Revenue Expenditure Ledger: Expenses to be written off gradually.
10. Suspense Account
Purpose: Used temporarily for transactions where the correct ledger is not yet determined.
Examples:
Suspense Ledger: Any uncertain or incomplete transactions are recorded here temporarily.
11. Sales Accounts
Purpose: Tracks income earned from selling goods or services.
Examples:
Domestic Sales Ledger: Records sales made within the country.
Export Sales Ledger: Tracks sales made to customers outside the country.
Sales A/c
Cash Sales A/c
Credit Sales A/c
12. Purchase Accounts
Purpose: Tracks the cost of goods or services purchased by the business.
Examples:
Local Purchases Ledger: Records purchases made from local suppliers.
Import Purchases Ledger: Tracks purchases made from foreign suppliers.
Purchase A/c
Cash Purchase A/c
Cash Sales A/c
Purchase Return A/c
13. Direct Incomes
Purpose: Represents income directly related to the core business activities.
Examples:
Commission Received Ledger: Tracks commission earned from sales.
Service Income Ledger: Records income from services provided.
Professional Charges A/c
Consulting Fees A/c
Service Charges A/c
14. Direct Expenses
Purpose: Represents expenses directly related to the production or purchase of goods.
Examples:
Freight Inwards Ledger: Tracks transportation costs for bringing goods into the business.
Raw Material Ledger: Records the cost of raw materials used in production.
Carriage inwards A/c
Wages A/c
15. Indirect Incomes
Purpose: Represents income from activities not directly related to the primary business operations.
Examples:
Interest Received Ledger: Tracks interest earned on deposits or investments.
Rental Income Ledger: Records income from renting out property or equipment.
Rent Received A/c
Interest Received A/c
Commission Received A/c
16. Indirect Expenses
Purpose: Represents expenses not directly related to the production of goods but necessary for running the business.
Examples:
Rent Ledger: Tracks payments made for renting office space.
Salary Ledger: Records payments made to employees.
Telephone Charges A/c
Bank Charges A/c
Rent Charges A/c
Electricity Expenses
17. Sundry Creditors (Under Current Liabilities)
Purpose: Tracks amounts owed to suppliers or vendors.
Examples:
Raja Suppliers Ledger: Records money owed to Raja Suppliers.
Kumar Traders Ledger: Tracks amounts payable to Kumar Traders.
Balram A/c
Rajan A/c
18. Sundry Debtors (Under Current Assets)
Purpose: Tracks money receivable from customers who purchased goods or services on credit.
Examples:
Suresh & Co Customer Ledger: Records amounts receivable from Customer Suresh & Co
Ramu A/c Ledger: Tracks money owed by Ramu A/c
19. Cash-in-Hand (Under Current Assets)
Purpose: Tracks all cash transactions of the business.
Examples:
Main Cash Ledger: Records cash held by the business.
Petty Cash Ledger: Tracks small cash expenses.
20. Bank Accounts (Under Current Assets)
Purpose: Tracks all transactions related to bank accounts.
Examples:
HDFC Bank Ledger: Records transactions with HDFC Bank.
ICICI Bank Ledger: Tracks transactions with ICICI Bank.
21. Loans & Advances (Asset) (Under Current Assets)
Purpose: Represents loans given by the business to others.
Examples:
Advance to Supplier Ledger: Records advance payments made to suppliers.
Loan to Employee Ledger: Tracks loans given to employees.
22. Duties & Taxes (Under Current Liabilities)
Purpose: Tracks amounts related to taxes and duties payable to the government.
Examples:
GST Ledger: Records Goods and Services Tax collected and payable.
Income Tax Ledger: Tracks the business’s income tax liability.
23. Provisions (Under Current Liabilities)
Purpose: Represents amounts set aside for future expenses or liabilities.
Examples:
Provision for Taxation Ledger: Tracks amounts set aside for tax payments.
Provision for Doubtful Debts Ledger: Records provisions made for bad debts.
24. Stock-in-Hand (Under Current Assets)
Purpose: Tracks the value of goods in stock.
Examples:
Finished Goods Ledger: Records the value of finished goods in inventory.
Raw Materials Ledger: Tracks the value of raw materials in stock.
25. Deposits (Asset) (Under Current Assets)
Purpose: Represents deposits made by the business that are expected to be returned.
Examples:
Security Deposit Ledger: Tracks deposits given for securing premises or equipment.
Fixed Deposit Ledger: Records fixed deposits made with banks.
26. Secured Loans (Under Loans (Liability))
Purpose: Tracks loans that are backed by collateral or security.
Examples:
Mortgage Loan Ledger: Records loans taken against property.
Car Loan Ledger: Tracks loans secured against a vehicle.
27. Unsecured Loans (Under Loans (Liability))
Purpose: Tracks loans that are not backed by any collateral.
Examples:
Personal Loan Ledger: Records personal loans taken by the business.
Overdraft Ledger: Tracks overdraft facilities provided by banks.
28. Branch/Division (Under Capital Account)
Purpose: Tracks accounts for different branches or divisions within the same company.
Examples:
Branch A Capital Ledger: Records the capital allocated to Branch A.
Division 1 Capital Ledger: Tracks the capital allocated to a specific division.
Group
Ledger Name
Purpose
Capital Account
Capital
Owner’s investment in the business.
Capital Account
Drawings
Owner’s withdrawals for personal use.
Capital Account
Partner A Capital
Capital contribution by Partner A.
Capital Account
Partner B Capital
Capital contribution by Partner B.
Reserves & Surplus
General Reserve
Accumulated profits set aside for future use.
Reserves & Surplus
Profit & Loss A/C
Profits or losses carried forward.
Reserves & Surplus
Retained Earnings
Profits retained in the business.
Reserves & Surplus
Dividend Reserve
Amount reserved for dividend distribution.
Loans (Liability)
Bank Loan
Loans taken from banks.
Loans (Liability)
Debentures
Funds raised through debentures.
Loans (Liability)
Loan from Directors
Loans taken from company directors.
Loans (Liability)
Mortgage Loan
Loans secured against property.
Current Liabilities
Sundry Creditors
Amounts payable to suppliers or vendors.
Current Liabilities
Outstanding Expenses
Expenses incurred but not yet paid.
Current Liabilities
Duties & Taxes
Taxes payable (e.g., GST, VAT).
Current Liabilities
Salary Payable
Salaries due but not yet paid.
Current Liabilities
TDS Payable
Tax Deducted at Source yet to be paid to the government.
Current Liabilities
GST Payable
Goods and Services Tax payable.
Current Liabilities
Professional Tax Payable
Professional tax due for payment.
Current Liabilities
Provident Fund Payable
Provident fund contributions due.
Current Assets
Sundry Debtors
Money receivable from customers.
Current Assets
Cash
Tracks all cash transactions.
Current Assets
HDFC Bank A/C
Transactions related to HDFC Bank.
Current Assets
ICICI Bank A/C
Transactions related to ICICI Bank.
Current Assets
Advance to Suppliers
Payments made in advance to suppliers.
Current Assets
Prepaid Insurance
Insurance premiums paid in advance.
Current Assets
Prepaid Rent
Rent paid in advance.
Current Assets
Petty Cash
Small cash expenses.
Current Assets
Advances to Employees
Money advanced to employees.
Current Assets
Bills Receivable
Bills that are due for payment from customers.
Current Assets
Fixed Deposit
Money deposited in fixed-term accounts.
Current Assets
Investments in Shares
Investments in company shares.
Fixed Assets
Building
Value of buildings owned by the business.
Fixed Assets
Machinery
Value of machinery used in the business.
Fixed Assets
Furniture & Fixtures
Value of office furniture and fixtures.
Fixed Assets
Computers
Value of computers and IT equipment.
Fixed Assets
Vehicles
Value of vehicles owned by the business.
Fixed Assets
Office Equipment
Value of office equipment (e.g., printers, fax machines).
Fixed Assets
Land
Value of land owned by the business.
Fixed Assets
Air Conditioning Equipment
Value of AC units installed in the office.
Fixed Assets
Tools & Equipment
Value of tools used in manufacturing or operations.
Investments
Shares in ABC Ltd.
Investment in shares of ABC Ltd.
Investments
Mutual Funds
Investments in mutual funds.
Investments
Government Bonds
Investments in government bonds.
Investments
Fixed Deposits
Fixed deposits with banks.
Investments
Real Estate Investment
Investments in real estate properties.
Investments
Investment in Subsidiary Company
Investment in a subsidiary company.
Investments
Investment in Partnership Firm
Investments in a partnership business.
Sales Accounts
Local Sales
Income from sales within the country.
Sales Accounts
Export Sales
Income from sales outside the country.
Sales Accounts
Sales of Services
Income from services provided.
Sales Accounts
Sales of Goods
Income from the sale of goods.
Sales Accounts
Sales Returns
Returns of sold goods.
Purchase Accounts
Local Purchases
Cost of goods purchased from local suppliers.
Purchase Accounts
Import Purchases
Cost of goods purchased from foreign suppliers.
Purchase Accounts
Purchase of Raw Materials
Cost of raw materials purchased for production.
Purchase Accounts
Purchase of Office Supplies
Cost of office supplies purchased.
Purchase Accounts
Purchase Returns
Returns of purchased goods.
Purchase Accounts
Freight Inwards
Cost of transportation for purchased goods.
Direct Incomes
Commission Received
Income from commissions earned on sales.
Direct Incomes
Service Income
Income from services provided.
Direct Incomes
Royalty Income
Income from royalties.
Direct Incomes
Interest on Loans Given
Interest earned on loans provided by the business.
Direct Incomes
Dividend Received
Dividends received from investments.
Direct Expenses
Freight Inwards
Transportation costs for bringing goods into the business.
Direct Expenses
Raw Material Purchases
Costs of raw materials used in production.
Direct Expenses
Power & Fuel
Expenses for power and fuel used in production.
Direct Expenses
Wages
Wages paid to labor directly involved in production.
Direct Expenses
Factory Rent
Rent for factory premises.
Indirect Incomes
Interest Received
Income from interest earned on deposits.
Indirect Incomes
Rental Income
Income from renting out property or equipment.
Indirect Incomes
Miscellaneous Income
Income from other sources not directly related to core business.
Indirect Incomes
Profit on Sale of Assets
Gain from the sale of fixed assets.
Indirect Incomes
Discount Received
Discounts received on purchases.
Indirect Expenses
Rent
Expenses related to renting office space.
Indirect Expenses
Salary
Payments made to employees.
Indirect Expenses
Office Expenses
General office expenses (e.g., stationery, utilities).
Indirect Expenses
Telephone Expenses
Costs of telephone and internet services.
Indirect Expenses
Travel Expenses
Expenses for business travel.
Indirect Expenses
Advertising Expenses
Costs related to marketing and advertising.
Indirect Expenses
Professional Fees
Payments made to professionals (e.g., lawyers, accountants).
Indirect Expenses
Insurance Premium
Costs of insurance for business assets.
Indirect Expenses
Repairs & Maintenance
Costs of maintaining and repairing business assets.
Indirect Expenses
Bad Debts
Amounts written off as unrecoverable debts.
Branch/Divisions
Branch A
Tracks transactions specific to Branch A.
Branch/Divisions
Branch B
Tracks transactions specific to Branch B.
Branch/Divisions
Division 1
Records transactions related to Division 1.
Branch/Divisions
Division 2
Records transactions related to Division 2.
Miscellaneous Expenses
Preliminary Expenses
Expenses incurred during the formation of the company.
Miscellaneous Expenses
Deferred Revenue Expenditure
Expenses to be written off gradually over time.
Miscellaneous Expenses
Promotional Expenses
Expenses for promoting new products or services.
Miscellaneous Expenses
Legal Fees
Legal costs that are amortized over time.
Secured Loans
Mortgage Loan
Loans secured against property.
Secured Loans
Car Loan
Loans secured against a vehicle.
Secured Loans
Equipment Loan
Loans secured against business equipment.
Secured Loans
Term Loan
Secured long-term loan.
Unsecured Loans
Personal Loan
Loans taken without any collateral.
Unsecured Loans
Overdraft
Bank overdraft facility.
Unsecured Loans
Loan from Friends
Unsecured loans taken from friends.
Unsecured Loans
Loan from Relatives
Unsecured loans taken from relatives.
Suspense Account
Suspense
Temporary account for uncertain or incomplete transactions.
Stock-in-Hand
Finished Goods
Value of goods that are ready for sale.
Stock-in-Hand
Raw Materials
Value of raw materials held in inventory.
Stock-in-Hand
Work in Progress
Value of unfinished goods in the production process.
