Table of Contents
Introduction
Hello everyone welcomes to TwinkleTalks.com in this article we are going to discuss the what is a Ledger and ledger groups in tally?
This is the Third (3rd) article in Tally ERP-9 series. Please read the previous article, have a look here “What and How to Create a Company in Tally ERP-9″. and ” Introduction to Tally ERP-9″.
Ledger and Ledger groups in Tally
By the End of this article, readers will get knowledge about
1.What is a ledger?
2.How many Types of ledgers are there?
3.What are the Ledger Groups in Tally?
4.How to Create the Ledgers in Tally?
What is a Ledger?
A ledger is a book or electronic record that contains all the organised transactional details of a company, organisation, or individual in a systematic manner.
Advantages of Ledgers
- Ledger act like a financial dairy, making it easy to see where money is coming from and going.
- Ledger reduces the chances of mistakes and make it easier to identify mistakes.
- It provides full data on their financial health, its help them to make decisions.
Types of Ledgers
In Normal Accounting, Ledger divided into two types
- Credit Ledger (Purchase Ledger)
- Debit Ledger (Sales Ledger)
- General Ledger
a) Private Ledger.
b) Nominal Ledger.
In Tally Accounting Software : Generally, In Balance Sheet, we have Capital Account, Current Assets ledgers (Closing Stock, Cash-in-hand) on the Assets side.
Loans (Liability), Current Liabilities ledgers (Duties & Taxes, Sundry Creditors) on the liabilities side.
Points to remember:
- Profit and loss account ledger position will be the change in Daybook according to the business.
- We can create many ledgers as per the requirement.
Ledger-Group’s
The groups which are using to say the type/characteristics of the ledger called The Ledgers Groups.
We have to allocate the perfect ledger-group to a ledger while creating.
There are Twenty Eighty (28) ledger groups in Tally ERP-9. In that we have two (2) types of group`s there are;
> Primary Ledger Groups (15).
> Secondary ledgers groups (13).
Primary Ledger Groups
Primary Ledger Groups: In these, we have six (6), Groups regarding Profit and loss account and Nine (9) groups regarding Balance sheet items.
Have a look at the Primary ledger group list.
| Primary Ledger Groups | |
| Profit and Loss a/c Items | |
| 1 | Purchse A/C |
| 2 | Sales A/C |
| 3 | Direct Income |
| 4 | Indirect Income |
| 5 | Direct Expenses |
| 6 | Indirect Expenses |
| Balance Sheet Items | |
| 7 | Capital A/C |
| 8 | Current Assets |
| 9 | Fixed Assets |
| 10 | Investments |
| 11 | Loan |
| 12 | Suspense A/C |
| 13 | Branch/division |
| 14 | Miscellaneous Expenses |
| 15 | Current Liabilities |
Secondary Ledger Groups
Secondary ledger groups: In these, we have Thirteen (13) ledger, groups all are related to Balance sheet items. Have a look at the Sub-ledger group list.
| Secondary Ledger Groups | |
| 1 | Cash-in-hand |
| 2 | Stock-in-hand |
| 3 | Bank A/C |
| 4 | Bank OD A/C |
| 5 | Sundry Creditors |
| 6 | Sundry Debitors |
| 7 | Secured Loans |
| 8 | Unsecured Loans |
| 9 | Loans And Advances (Assets) |
| 10 | Duties and Taxes |
| 11 | Provisions |
| 12 | Deposits |
| 13 | Reserves and Surplus |
Note: We can add/create sub-ledgers groups to the ledger groups as our requirement and understanding/convenient.
Explaining the Ledger and Ledger groups concept by a story
For example, let us assume we went for shopping at the stores/D-mart/Wall-mart.
| Comparing the Shopping with Accounts | |
| Store | Tally ERP-9 |
| D-mart/ Wall-mart/ spencer | Company Creation |
| All Items we selected | Ledger’s |
| Food Items, clothes | Ledger groups |
| Vegetables, snaks, Night wear, formal | Sub-ledger groups |
| Bill counter | Transaction entries (Dr./Cr) |
| Change we get (or) remaining balance in our debit / credit card after paying the bill | Cash-in-hand / Cash-at-bank |
| Entire Shopping | Accounting |
Comparing the Order of Accounting
| Order of Accounting | ||
| In Manual Accounting | Steps in order | In Tally ERP-9 |
| Creating Proforma | < Step 1 > | Company Creation |
| Transaction Entries | < Step 2 > | Ledger Creation |
| Ledger Creation/ entries | < Step 3 > | Transaction Entries |
| Checking the balance sheet | < Step 4 > | Checking the balance sheet |
Thank You For reading this article regarding Ledger and ledger groups in tally Thank you so much.
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