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Journal vouchers are those vouchers used to enter adjustment entries. Depreciation is one of the adjustment entry that are done at the end of the financial year.We normally input this entry on March 31st .The Important point to be noted is; this kind of adjustment entry do not have involvement of cash or bank account. This means that when such transactions incur we do not pay anything in cash or cheque.
Where does we use journal voucher in tally?
There are so many occasions where we can use journal voucher in tally erp 9. I will explain this in brief.
- For booking of credit purchase of consumables like stationary, staff welfare expense like, tea, drinking water etc. Normally we do not use journal voucher to book Purchases of raw materials or purchase of items for sale.
- For booking outstanding expense we use journal voucher.
- For booking of pre-paid expense, journal vouchers are used.
- Accrued Income booking
- To record un-earned income
- Journal entries required for reversing the adjusting entries.
- To record depreciation on fixed asset.
- After recovery of bad debts, the bad debts recovered account shall be closed by transferring it to Bad debts.
- Some times we use journal voucher to transfer interest on capital to the current account of the partner, or to charge interest on drawings to partners current account.
- In General we use journal voucher to record transactions without the involvement of cash or bank account.
How to pass a Journal Voucher in Tally,
Go to Gateway of Tally > Accounting Vouchers
- Click on F7: Journal button on the Button Bar or press F7 shortcut key.
- Change the date by pressing F2 or click on date button at the right top.
- Enter debit aspect just after ‘By‘ & Credit aspect after ‘To‘ also enter amount in the amount field.
- Enter narration in the narration field.
- Save the journal entry voucher by continue to press Enter Key.
Example of Journal Entry in tally erp 9
Journal entry for Depreciation
On 31st March 2016 ABC Ltd want to enter depreciation of Furniture @ 10 %.The value of Furniture before writing down is 25000.00.
Value of asset before depreciation – 25000.00
Depreciation 10% – 2500.00
To record this transaction, Go to Accounting Voucher > F7 Journal.
Input the date by pressing F2 shortcut keys or click on Date button.31-03-2016
Debit Depreciation A/c
The Journal entry is displayed as shown:
Journal entry examples for outstanding expense
Example 2 : ABC Ltd wants to make a provision for outstanding telephone expense of Rs 1500.00 for the month of May .Normally we get telephone bills in the subsequent month.that is in the month of June.
To get exact profit of the May 2016, we must input all the expenses attributable to that particular month. So telephone expense is pertaining to may must considered.Telephone bills of companies like BSNL is available online within a few days of expiry of a month.
- Choose the date 28-02–2016
- enter the debit aspect as ‘Telephone Expense’
- Credit aspect as ‘Out standing Telephone Expense’.
Note:Outstanding telephone expense ledger should be grouped under current liability. Here in tally there is a group called. ‘Provisions‘. This group is the sub group of “Current Liabilities”.
Here is the Journal entry for outstanding Expense look like.
Press enter & save.
Journal entry example for prepaid expense
Example 3 : On 1st June 2017 ABC Ltd paid Rs 25000 to PC World towards Annual maintenance changes for 10 computer @ 2500.00.
Here in this example the current financial year is 2017-18 and we are in Third month of Financial year; ie; june. The remaining month till march 2018 is 10. We have paid AMC charges till May 31st 2018. That is two months are April and May is applicable for Next Financial year 2018-19. So we have to account expense for 10 months in the FY 2017-18 & 2 Months in the FY -2018-19. So the expense for two months are pre-paid. So how to account prepaid expense in tally erp 9.
The Journal entry for this entry is
AMC Charges a/c………………Dr 20000.00
Prepaid AMC charges a/c ….. Dr 5000.00
To; PC World A/c 25000.00
Let’s Book this prepaid expense entry into tally erp 9.
|AMC Charges||Indirect Expense|
|Prepiad AMC Charges||Current Asset|
|PC World||Sundry Debtors|
Now let’s begin entering the prepaid expense in tally.
- Go to Gateway of Tally> Accounting Voucher > F7 Journal.
- Enter date ,here 01-06-2017 in which payment is due and made payment.
- Debit AMC Charges 20000 and Prapiad AMC Charges 5000
- Credit party name PC World
- Enter narration
Here is the screenshot of the journal entry
The expense for the current Financial year 2017-18 will appear in the profit and loss account and the expense for upcoming Financial year will be shown in the Asset side of the balance sheet.
In 2018-19 you can write off this asset by debiting Prepaid expense & Crediting Prepaid AMC Charges.