Tally Accounts And The General LedgerThe general ledger is the big daddy of all accounting books. Using Tally software can help you effectively and efficiently deal with all issues of the big daddy of all your accounting books which will allow you more time to make your business grow. But first let's take a look at the General Ledger. Like a diary, the GL (general ledger) is a chronological record of your business transactions. As businesses grew and got more complex, the ledger needed to be organized to better reflect more complicated transactions. Nowadays when using Tally Accounts and in general, the general ledger is divided into main categories: Assets, liabilities, owner's equity, revenues and expenses. Think of them as five large baskets that contain financial information that pertain only to its category. Sales go in the asset basket; a loan goes in the liability basket.Assets: Everything of value that your business posses, such as cash, or is owed, from products for sale and receivables (money owed your business) to the machinery that your business uses to generate revenues. Liabilities: Obligations (loans, IOUs, etc) that your business incurs in teh process of doing business--typically, this means bills, taxes, long-term loans, and salaries. Owner's Equity: Whatever is left of the original capital invested in your company, plus any earnings retained from operations. Revenue: Income from sales of goods or services. Expenses: This category covers the Cost of Goods Sold or the direct costs of making your product (materials, direct labor) as well as operating expenses (administrative expenses such as overhead and non-labor payroll).Note: When using Tally Accounts and the general ledger know that within these categories in the ledger are smaller baskets called subledgers. Usually at the end of every month these subledger baskets are consolidated into its matching large basket. Leave The Tally Accounts And The General Ledger Page To Return To The Home Page |