Maintaining Outstanding Reports for Creditors and Debtors in Tally Prime
In every business, managing outstanding balances for both creditors (suppliers) and debtors (customers) is essential to maintain healthy cash flow. Tally Prime provides robust features to track these outstanding balances and generate reports to help businesses manage their finances. In this article, we will walk you through the process of maintaining and viewing outstanding reports for creditors and debtors in Tally Prime, with real-life examples for better understanding.
1. Enabling Accounts Receivable and Accounts Payable in Tally Prime
To track outstanding amounts for debtors (accounts receivable) and creditors (accounts payable), you need to first enable the feature in Tally Prime.
Go to Gateway of Tally → F11: Features → Accounting Features.
Ensure that the option Enable Accounts Receivable and Accounts Payable is set to "Yes".
Press Enter to save the settings.
2. Creating Ledger Accounts for Debtors and Creditors
In Tally Prime, you need to create ledgers for your debtors (customers) and creditors (suppliers). This will allow you to track transactions specific to them and view outstanding balances.
Go to Gateway of Tally → Accounts Info → Ledgers → Create.
For creating a debtor (customer) ledger, under Under: select Sundry Debtors and name it after the customer (e.g., John Doe).
For creating a creditor (supplier) ledger, under Under: select Sundry Creditors and name it after the supplier (e.g., ABC Suppliers).
Press Enter to save the ledgers.
Example: Creating Customer and Supplier Ledgers
Customer Ledger Name: John Doe
Supplier Ledger Name: ABC Suppliers
3. Recording Sales and Purchases for Tracking Outstanding Balances
To track outstanding balances, you must enter transactions for sales (debtor) and purchases (creditor). These transactions update the outstanding balances automatically in Tally Prime.
Recording a Sale (Receivable)
Go to Gateway of Tally → Accounting Vouchers → F8: Sales.
Choose the debtor (e.g., John Doe).
Enter the details of the item sold, such as item name, quantity, and rate.
Enter the total amount and applicable taxes (e.g., GST).
Tally will automatically update the outstanding amount for John Doe in the Accounts Receivable report.
Press Enter to save the sale transaction.
Example: Sale to John Doe
Customer Name: John Doe
Item Sold: Product X
Sale Amount: $1,000
GST (18%): $180
Total Receivable: $1,180
Recording a Purchase (Payable)
Go to Gateway of Tally → Accounting Vouchers → F9: Purchase.
Choose the supplier (e.g., ABC Suppliers).
Enter the details of the item purchased, such as item name, quantity, and rate.
Enter the total amount and applicable taxes (e.g., GST).
Tally will automatically update the outstanding amount for ABC Suppliers in the Accounts Payable report.
Press Enter to save the purchase transaction.
Example: Purchase from ABC Suppliers
Supplier Name: ABC Suppliers
Item Purchased: Product Y
Purchase Amount: $800
GST (18%): $144
Total Payable: $944
4. Viewing Outstanding Reports for Debtors (Accounts Receivable)
After entering sales transactions, you can view the outstanding amounts for your debtors by generating the Accounts Receivable report.
Go to Gateway of Tally → Display → Statements of Accounts → Receivables.
This report will display the outstanding amounts for all debtors, including any overdue balances.
You can filter the report by customer, date, or other criteria to view specific outstanding amounts.
Example: Accounts Receivable Report for John Doe
Customer Name: John Doe
Outstanding Amount: $1,180
Due Date: 15th December 2024
5. Viewing Outstanding Reports for Creditors (Accounts Payable)
Similarly, after entering purchase transactions, you can view the outstanding amounts for your creditors by generating the Accounts Payable report.
Go to Gateway of Tally → Display → Statements of Accounts → Payables.
This report will display the outstanding amounts for all creditors, including any overdue balances.
You can filter the report by supplier, date, or other criteria to view specific outstanding amounts.
Example: Accounts Payable Report for ABC Suppliers
Supplier Name: ABC Suppliers
Outstanding Amount: $944
Due Date: 20th December 2024
6. Settling Outstanding Amounts (Payment/Receipt)
Once you receive payments from customers or make payments to suppliers, you can update the outstanding balances in Tally Prime.
Recording a Payment (To Creditor)
Go to Gateway of Tally → Accounting Vouchers → F5: Payment.
Select the supplier (e.g., ABC Suppliers) and enter the amount paid.
Link the payment to the relevant bank account (e.g., XYZ Bank).
Press Enter to save the payment transaction.
Example: Payment to ABC Suppliers
Supplier Name: ABC Suppliers
Amount Paid: $944
Bank Account: XYZ Bank
Recording a Receipt (From Debtor)
Go to Gateway of Tally → Accounting Vouchers → F6: Receipt.
Select the customer (e.g., John Doe) and enter the amount received.
Link the receipt to the relevant bank account (e.g., XYZ Bank).
Press Enter to save the receipt transaction.
Example: Receipt from John Doe
Customer Name: John Doe
Amount Received: $1,180
Bank Account: XYZ Bank
By following the above steps, you can easily manage and track outstanding balances for both your creditors and debtors in Tally Prime. These reports provide a clear view of your business's outstanding dues, enabling timely payments and receipts to ensure smooth financial operations.