Defining Budgets for Groups, Ledgers, and Cost Centers in Tally Prime
Tally Prime is a powerful accounting software that helps businesses manage finances efficiently. One key feature is the ability to define budgets for various entities like groups, ledgers, and cost centers. This article provides a step-by-step guide with an example to help you understand how to define budgets in Tally Prime.
Step-by-Step Guide
Step 1: Enable Budgets in Tally Prime
Open Tally Prime.
Go to Gateway of Tally > F11: Features.
Select Accounting Features.
Set Enable Budgets to "Yes".
Press Ctrl+A to save the settings.
Step 2: Create a Budget
Go to Gateway of Tally > Accounts Info > Budgets.
Select Create.
Enter a name for the budget, e.g., "Marketing Budget 2024".
Under the field Period, define the start and end dates of the budget.
Choose the Type of Budget:
On Groups: To set budgets for specific account groups.
On Ledgers: To set budgets for individual ledger accounts.
On Cost Centers: To allocate budgets for different cost centers.
Step 3: Allocate Budgets to Groups
In the budget creation screen, select Groups.
Choose the group, e.g., "Indirect Expenses".
Enter the budget amount, e.g., ₹500,000 for the financial year.
Save the budget allocation by pressing Ctrl+A.
Step 4: Allocate Budgets to Ledgers
In the budget creation screen, select Ledgers.
Choose a ledger, e.g., "Advertisement Expenses".
Enter the budget amount, e.g., ₹100,000 for the financial year.
Save the allocation by pressing Ctrl+A.
Step 5: Allocate Budgets to Cost Centers
In the budget creation screen, select Cost Centers.
Choose a cost center, e.g., "Mumbai Branch".
Enter the budget amount, e.g., ₹200,000 for the financial year.
Save the allocation by pressing Ctrl+A.
Example: Marketing Budget 2024
Let us define a marketing budget for 2024:
Group: "Indirect Expenses" - ₹500,000
Ledger: "Advertisement Expenses" - ₹100,000
Cost Center: "Mumbai Branch" - ₹200,000
Steps to Define:
Create a budget named "Marketing Budget 2024".
Set the period as 1-Apr-2024 to 31-Mar-2025.
Allocate ₹500,000 to the group "Indirect Expenses".
Allocate ₹100,000 to the ledger "Advertisement Expenses".
Allocate ₹200,000 to the cost center "Mumbai Branch".
Conclusion
Defining budgets in Tally Prime is a straightforward process that allows businesses to monitor their financial performance effectively. With the steps outlined above, you can create and allocate budgets for groups, ledgers, and cost centers to enhance your financial planning and control.