Business Application of IT - 2

Q1) Write a short notes on:

(1) Contra Vouchers

Cash or cheque deposited into bank, cash withdrawn from bank, transfer of funds from one bank account to another will be entered through Contra Voucher. Here Debit and Credit accounts can be only be Cash and Bank Accounts.

If the amount is deposited into the bank, then Bank A/c will be Debited and Cash A/c will be Credited.

If the amount is withdrawn from the bank, then Cash A/c is Debited and Bank A/c is Credited.

If one bank’s cheque is deposited into another bank, then the first Bank a/c is credited and later Bank a/c is debited.

Always a Contra Voucher will prompt the user to enter the Credit aspect of the voucher first.

A Contra Voucher can be entered by pressing the function key F4.

(2) Journal Vouchers

A Journal Voucher is an adjustment voucher. All amounts to be adjusted between two accounts are to be passed as a journal. By adjustment between the accounts we mean, there is no physical movement of funds. Purchase Returns, Sales Returns, Depreciation on Fixed Assets etc., can be entered through the Journal.

Journal entries can be entered by pressing the function key F7.

In Accounting Features, if Use Debit/Credit Notes option is set to Yes, then , if voucher type is set to Journal (F7), three options will be displayed.

Q2) Write short notes on:

( i ). Balance Sheet

A Balance Sheet is a statement of the financial position of the company. It displays the Capital, Assets and Liabilities of the company.

To display the Balance Sheet, select Balance Sheet from Gateway of Tally menu.

By default, the Balance Sheet will be displayed in double columnar horizontal format with the closing balances of Primary Groups of Liabilities and Assets.

The Liabilities include the Capital Account, Current Liabilities, Loan Liabilities, Net Profit if any etc.

The Assets include the Fixed Assets, Current Assets, Investments, Loans and Advances (Asset),

Net Loss if any etc.

General Instructions to be followed in preparation of Balance Sheet-

- The Balance Sheet is displayed in double columnar horizontal format with the closing balances of Primary Groups of Liabilities and Assets.

- The Liabilities include the Capital Account, Current Liabilities, Loan Liabilities, Net Profit if any etc

- The Assets include The Fixed Assets, Current Assets, Investments, Loans and Advances (Asset), Net Loss if any etc.

- To view the detailed balance sheet (to display each accounts’ balance in the group, press Alt+F1. If detailed balance sheet is displayed, then to display in condensed mode (group balances only), press Alt+F1 again.

- The Balance Sheet will be displayed for the current period (from the Books Beginning From date to current date). To display the Balance Sheet for particular period (for the quarter, half-year etc.), press F2. Tally will prompt you to enter the From and To dates, for which period the balance sheet will be displayed.

- If many companies are open, view the balance sheet of the desired company, and press F3. The open company names will be displayed. Select the name of company, the Balance Sheet of which is to be displayed.

- The closing stock is calculated based on the valuation method specified when creating the stock items. In order to change the Valuation Method for the Closing Stock in Balance Sheet, press F7. Change Valuation Method menu will be displayed. Select a valuation method like FIFO, LIFO etc.

- To compare the balances of more than one company on the same screen, add a column by pressing Alt+C. Select a name from the list of open company names. Balance Sheet with an additional column, will appear on the screen.

- To delete the column, press Alt+D by placing the cursor in the column of company, which is to be removed. All columns from a report cannot be removed. A report must have at least one column.

Configuring Balance Sheet

The Balance Sheet can be configured by pressing the function key F12.

1. Balance Sheet can be displayed in horizontal format (with Assets and Liabilities side by side in 2 different columns) or in Vertical format (with Source of Funds followed by Application of Funds). To display vertical Balance Sheet, select Show Vertical Balance Sheet? Yes. Default is No.
2. In order to view the Balance Sheet figures with their percentage break-ups, select show percentage Yes. Default is No.
3. Instead of representing the Current Assets and Liabilities separately, to present Working Capital Analysis, select Show Working Capital Figures? Yes. Default is No.
4. By default, the Balance Sheet will display the Liabilities on the left and Assets on the right side. Assets can be displayed on the Left and Liabilities can be displayed on the right side by selecting the option from Method of Showing Balance Sheet. Default is Liabilities / Assets.
5. Different scale of factors for values are available to round off the balances to the nearest crores, lakhs, hundreds etc.,

( ii ). Profit and Loss account

Profit and Loss Account will display the Net Profit or Loss of the company for the current financial year. To view the Profit and Loss Account, select Profit and Loss Account from Gateway of Tally menu.

- To display the detailed Profit and Loss Account, Press Alt+F1.

If detailed Profit and Loss A/c is displayed, to display the condensed profit and loss A/c,

press Alt + F1 again.

To display the Profit and Loss Account for a specific period of time, press F2 and type the From and To date

To change the method of calculating the Closing Stock Value (FIFO, LIFO etc.,) press F7.

To view the Profit and Loss A/c of more than one open company, press Alt+C. Similarly, to delete a column of company press Alt+D.

- Configuring Profit and Loss Account

To configure the Profit and Loss Account, press F12. By default, the profit and loss account will be displayed, horizontally with the details in 2 columns. To display a Vertical Profit and Loss Account, select Show Vertical Profit & Loss ? Yes. Default is No.

To view the percentage analysis of Profit and Loss A/c figures, select Show Percentages? Yes.Default is No.

By default, Profit and Loss A/c calculates the Gross Profit and then Net Profit separately. If Gross Profit calculation is not necessary, select Show with Gross Profit/ No. Default is Yes.

To change the scale factor for values like lakhs, crores, hundreds etc., use the Scale Factor for Values.

Q3) What is Data Consolidation? What are the different ways of consolidating data?

Consolidation is a process where information or data from different sources are merged or consolidated. Using this command it is possible to,

- Consolidate information stored on different worksheets within the same workbook.

- Consolidate information stored on different workbooks (without opening the workbooks).

- Consolidate data on the basis of row and column labels, regardless of position on the worksheet.

- Consolidate multiple ranges on the same worksheet.

- Use different calculations such as sum, count and average.

- Link the consolidation to the source data.

Data consolidation can be done based on two different ways:

1- Consolidating by Position

2- Consolidating by Category (i.e. rows/columns)

1- Consolidating by Position

- Consolidation based on position requires that the data be structured identically, relative within each data source.

- Each cell being consolidated must reside in the same relative position within the source range. The relative position of cells within each range is critical.

- The row and column heading in the source range(s) are ignored, even if they are included as part of the consolidation range.

- Generally, consolidating by position is a risky. A minor change to source data can cause erroneous results.

2- Consolidating by Category

- When consolidated on the basis of category, the row and/or column labels are used to determine how to perform the consolidation.

- The source data ranges do not have to be structured identically (i.e. worksheets can have similar data but in different locations and the number of rows/columns of data differs).

- The source ranges can contain a varying number of rows or columns and must include the row and/or column labels.

- The sequence of the row and/or column labels does not matter.

Q4) Explain Goal seek with an example.

Essentially, Goal Seek solves formulas backwards. Here the results needed as well as the single input to be changed is known. To determine the value of the input to get the desired result, Goal seek is used. When goal seeking, Microsoft Excel varies the value in one specific cell unit a formula that is dependent on that cell returns the result required.

To start Goal Seek, select a cell containing a formula (cell D3), then choose Tools > Goal Seek.

The cell containing the formula will be the Set Cell. It will be automatically displayed. In the To value text box, type the target value. In place of By changing cell, type the address of cell, the value of which is to be changed. And click on OK.

It will display Goal Seek Status by changing the commission rate. Click on OK.

Example:

To buy a car, a bank loan is available at 9% annual interest rate. The term of loan is 36 months. The loan requires a 20% down payment. The maximum monthly payment affordable is Rs. 300. Now, find out at what price the car can be bought depending on the above conditions.