Journal Voucher Entry

Journal voucher in Tally is an important voucher which is used to make all kind of adjustment entries, credit purchases or sales, fixed assets purchase entries. In order to pass entries as journal voucher we have to press “F7” shortcut key from accounting Voucher screen on Gateway of Tally.

For what Purpose a Journal Voucher is Used in Tally

This voucher is used for all adjustment or due entries in tally software, or in other words entry which is not made by other accounting vouchers are made by this voucher.
For Example: Credit purchases of fixed asset from creditor Rs. 50,000/-
Dr. Fixed Assets       50,000

Dr. CGST          4.500

Dr. SGST.            4,500

Cr. Creditor           59,000
For adjusting entries using journal voucher: The use of adjusting entry is to get accurate financial result of a company.
For example: We use Journal vouchers in Tally for different scenarios listed below :

For journalising Outstanding Expenses	·       Outstanding expenses are expenses which are due but not paid. ·       Usually Rent bill/Electricity bill, newspaper subscription fee, salary for the month of March is paid on April of the new accounting year but as per going concern principle, expense should be recorded in March itself so as to get an accurate financial report or profit of a complete financial year. ·       In this scenario, we use a journal entry at the end of the march by debiting “rent expense” and crediting “expense payable ledger”.
To record prepaid expense	Pre- paid expenses are expenses paid in advance, the expense of which is said to accrue over the months or e Periods or even more than one financial year in many cases.
To recognize accrued income	Accrued income is an income earned but not received. It is a current asset for the company.   This has to be recorded as income for the financial year to which it pertains by passing a journal entry.
Accrued Income	Accrued income is an income received but not earned, which means cash or consideration received in advance but not actually earned. For example a digital marketing company receives money Rs.15,000 as advance for a particular project. But service was not provided till the date of receipt. In such case initially we debit cash account for the sum received and credit liability account like Accrued income account and on completion and delivery we debit the liability account and credit the revenue account using a journal entry.
For Transfer entries	Transfer entries are used to transfer funds from one account to another. For Example: 01-05-2018 ABC Ltd has two accounts in the books of accounts as “ABC Ltd (Debtor)” hold a debit balance of Rs 1000 and “ABC Ltd (Creditor)” hold a credit balance of Rs. 1000. To transfer funds from “ABC Ltd (Creditor)” to ABC Ltd (Debtor) and to close both accounts, we need to pass a journal entry by debiting ABC Ltd (Creditor) and crediting ABC Ltd (Debtor).
For correcting wrong entries passed in the books of accounts	There may be situations where accounts are wrongly credited or debited, In such case to correct those entries we reverse the first entry to transfer from wrong account to the correct account using a journal entry in Tally.

Steps to Enter a Journal Entry in Tally

Journal entries in Tally are bye- passed through journal vouchers. The shortest route for accessing journal voucher in accounting voucher menu is F7.
To enter a journal entry in Tally. ERP 9 follow these simple steps:

Step 1	From the gateway of Tally.ERP 9, Go to Accounting Voucher, Gateway of Tally > Accounting Voucher.
Step 2	Now hit F7 shortcut key for journal voucher entry or click on F - 7 Journal button on the right side of the screen.
Step 3	Change the date by pressing shortcut key F2 or click on date button at the top right.
Step 4	Under the particulars column after By/Dr enter the ledger to be debited and amount of the transaction. The users can enter multiple debit aspects (ledger to be debited) one by one if needed.
Step 5	After entering Debit aspect, select To/Cr and select the ledger to be credited and amount in the next field.
Step 6	Now in the narration field, enter the details of transactions and hit enter to save the journal voucher.

Example:  Purchase of Drinking water from Himalaya Springs on credit for Rs 1000.00.

In such case we will make a journal entry for making provision. By debiting  STAFF WELFARE EXPENSE OR DRINKING WATER EXPENSE  and crediting Party ledger.

Date	Particulars	Debit	Credit
01-06-2016	Staff Welfare Expense........Dr	1000
	To, Himalaya Spring		1000
	Being Drinking water purchased from himalaya springs on credit bill no 12

Make sure that you have created Staff welfare expense under Indirect expense and Himalaya springs Under sundry creditors ledger. Lets enter this expense in Tally journal Voucher.

Outstanding expense Journal Entry in Tally ERP9

For booking outstanding expense in tally erp9, consider the following example.

Telephone bill from BSNL for the month of May 2016 is 2500.00,Bill received on 10th of June 2016.

To get exact profit of May you must enter this expense of May 31st itself. for easy understanding here is the journal entry for the telephone expense to be booked on may 31 st.

Date	Particulars	Debit	Credit
31-05-2016	Telephone Expense.........Dr	2500
	Telephone Expense Payable A/c		2500
	Being telephone Expense for the period of 01-05-2016 to 31-05-2016 payable to BSNL

Now enter the Debit just after By provided in the screen and credit just after To as shown in the image below.

Press Enter and accept the screen.

Prepaid Expense Journal entry voucher in tally

As earlier explained lets consider the following example for the pre-paid expense.

Insurance premium paid 5000 to New India Assurance Co Ltd, on May 1st 2016 for 1 year. The expense is spread over more than one Financial year.That is The expense is shared in FY 2016-17 ( May 2016 to March 2017 is 11 months)  hence current FY premium is calculated as 5000/12*11 = 4583.00 and for FY 2017-18 1 Month = 5000/12*10 = 417. So Rs 417 is a pre-paid expense or Insurance premium pre-paid.

In this case first you have to pass a compound journal entry as mentioned below

Date	Particulars	Debit	Credit
01-05-2016	Insurance Premium......................Dr	4583.00
	Pre-paid Insurance premium ....Dr	417.00
	To; New India Assurance Co Ltd		5000
	Being insurance premium paid for one year split for current year premium and coming year pre -paid premium and accounted

Now enter prepaid insurance expense in tally as shown below.

After passing this journal entry you can make payment entry using F5 Payment voucher in tally erp9.

Accrued Income Journal Entry in Tally ERP9.

Let’s take an example of accrued income

ABC Ltd deposited Rs 500000 in bank as Fixed deposit @ 8.5% /year.  On 31 st march 2016 company will have earned one month interest  500000 x 8.5%/12 x 1month  =3542. This has to be recorded as income in march 31st 2016 even if the total interest will be received only after completion of tenure one year.

The entry for accrued interest is as follows.

Date	Particulars	Debit	Credit
31-05-2016	Accrued Interest..............Dr	3542.00
	To; Interest on deposit		3542.00
	Interest earned from Fixed deposit in SBI from 1st May to 31 st may 2016 accounted

Now entry of accrued income or interest in tally.

Examples of Unearned Income Journal entry

Leo International is renting a portion of their building for a monthly rent of 20000, On 1st April 2016 They received a cheque of 80000 as rent advance till july 31st. Make the receipt entry and adjust the income in monthly p& l account 

Create a ledger of ‘Unearned Rent‘ ledger under Group current Liabilities.
When amount received pass a receipt entry by debiting Bank a/c and crediting Unearned income.

Journal Book
Date	Particulars	LF	Debit	Credit
1/4/2016
	State Bank Of India————Dr		80000
	To; Unearned Rent			80000
	(being 4 months rent advance received)

Now we have recorded the receipt as liability to the business. At the end of the April 30 2016 the business will earn one month rent. For booking april month rent as income we have to transfer 20000 from unearned rent to rent received account in order to extract the accurate profit from P&L Account.
The journal entry for the same is

Journal Book
Date	Particulars……………………….……..Dr	LF	Debit	Credit
30/4/2016
	Un earned Rent————–Dr		20000
	To; Rent received a/c			20000
	(being unearned rent transferred to april moth rent received account)

This entry can be recorded only through journal voucher of tally erp 9. Let’s do this.

This transfer 20000 from unearned rent account to rent received account. The balance of unearned income become 60000. In the same manner every month end till july 31st pass the same entry.the whole amount got transferred to rent received account and unearned income account will become zero.

Depreciation Journal entry in tally

Lets enter a depreciation journal entry at first. For example

Furniture worth rs 15000 depreciated and accounted @ 10% &  Plant and Machinery valued Rs 250000 depreciated @ 15% at the end of the FY 31-03-2016

The journal entry for  the above is as follows.

Date	Particulars	Debit	Credit
31-03-2016	Depreciation.......Dr	39000.00
	To Furniture		1500.00
	To; Plant & Machinery		37500.00
	Being amount of depreciation charged on particular assets

Here is the depreciation journal entry screen in tally erp 9

Journal entry for Purchase and sale of fixed Asset on account in tally.

Computer purchased from Computer solutions for Rs 25000.00

The journal entry for the above transaction is

Date	Particulars	Debit	Credit
01-04-2013	Computer & Peripherals ----- Dr	25000.00
	To; Computer Solutions		25000.00
	being computer purchased from computer solutions as per bill cs 15225

Create both the ledger if not existing in your company and enter as follows

Press enter key and save the screen .that is it.

Correction journal entries (Further understanding on journal voucher)

Let’s do another example of correcting an entry

A computer purchased from computer solutions wrongly entered in “system solutions” account as per bill no 1523 for Rs 25000.00

The entry you wrongly made was

Date	Particulars	Debit	Credit
01-04-2013	Computer & Peripherals ——— Dr	25000.00
	To System Solutions———		25000.00
	(Being computer purchased as per bill no 1523)

The credit should be computer solutions instead system solutions, to correct this we can follow two methods
Method 1
Reverse the wrong entry and make correct entries
The reverse journal entry is

Date	Particulars	Debit	Credit
01-04-2013	System Solutions ————— Dr	25000.00
	To; Computer & Peripherals		25000
	(to cancel the jv no 1 as the it was a wrong entry)

The effect of the above journal is the cancellation of first entry, now what we do is make a fresh correct entry.

Date	Particulars	Debit	Credit
01-04-2013	Computer & Peripherals ----- Dr	25000.00
	To; Computer Solutions		25000.00
	being computer purchased from computer solutions as per bill cs 15225

Method 2
Just make a single journal entry to transfer balance from system solutions to computer solutions

Date	Particulars	Debit	Credit
01-04-2013	System solutions————-Dr	25000.00
	To; Computer Solutions		25000.00
	(Being computer purchased from computer solutions wrongly entered in system solution account transferred to computer solutions account as per bill no 1523)

How to enter transfer journal entries in tally

Example: 

on 01-05-2016 XYZ  Ltd has two accounts in your books of accounts as “XYZ Ltd ( Debtor)” hold a debit balance of Rs 1000 and “XYZ Ltd ( Creditor)”  hold a credit balance of Rs 1000. You need to transfer of rs 1000 in debtor account to creditor account and close both the account.

Date	Particulars	Debit	Credit
01-05-2016	XYZ Ltd ( Creditor) ........Dr	1000.00
	To; XYZ Ltd ( Debtor)		1000.00
	Being amount transferred from XYZ Debtor accounts which was receivable to XYZ Creditor account which was payable and closed both the account.

Statutory Adjustment Journal voucher for GST and other tax compliance.

In tally there is a special option in the journal voucher called Stat Adjustments,You can use this option by clicking on the Stat Adjustment button  or use shortcut key Alt+J. Here you can offset input tax credit against the tax liability.  or you can increase the tax liability or input tax credits in cases like reverse charges, import of goods, purchase from unregistered dealers where there is no tax found in the purchase invoices.
Go to Gateway of Tally > Accounting Vouchers > F7: Journal
Click J : Stat Adjustment .

By using which you can make adjustments in the tax compliance. You will learn more about this in GST Section.

Use Dr/Cr Instead of To/By

In the journal voucher entry screen you can see To/By to indicate Debit and credit aspects.Some tally users are getting confused with this. Those who want to use  Dr/Cr instead of this there is an option. Here Dr is Debit and Cr is Credit, to activate this
Click  F12 configure button at the bottom right, You will get a journal standard configuration.
Find the option Use Cr/Dr instead of To/By during entry activate by typing Yes

Save the screen now you will see Dr/Cr  in the screen








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