• 1. What is the difference between a journal and a voucher, i.e., receipts, payments, etc., in Tally? Do I need to record all transactions by their nature? For example, for an amount received, do I need to record a receipt entry, or will journal entries also work? Will there be any different result between them?

2. How do I record expenses for different sites in a construction company? Is it the correct approach to create a ledger for every expense for each site, as mentioned below? Let's assume ABC Builders has two ongoing sites called Site A and Site B. Can I record it like this: under indirect expenses > group > Site A Expenses A/c, and create different ledgers like transportation, labor, etc.? If I can do that, how can I link different groups in different categories, for example, Indirect expenses of Site A with Sundry Debtors of Site A, Sundry Creditors of Site A, etc.? If I need a report of all the transaction types for Site A only, how can I obtain that?

3. Is it mandatory by law to maintain stock in a construction company?

Thanks in advance

1. In Tally, there are two important things you can use to keep track of your financial transactions: journal entries and vouchers.

- Journal Entry: Think of a journal entry as a way to record general information about transactions that don't have a specific category. It's useful for things like adjustments, depreciation, or accruals. Journal entries don't directly affect your cash or bank balances.

- Vouchers: Vouchers, on the other hand, are designed for specific types of transactions like receipts, payments, purchases, or sales. Each voucher captures important details like the party involved, the amount, and how it was paid. Vouchers directly impact your cash or bank balances and are great for day-to-day transactions.

To keep your financial records accurate, it's best to use the right voucher type whenever possible. While you can use journal entries, using vouchers helps you stay organized, keep better track of your transactions, and generate more accurate financial reports.

2. When it comes to recording expenses for different sites in a construction company, you have a few options. One effective approach is to create separate ledgers for each expense category at each site. Here's how you can set it up in Tally:

- Start by creating a group called "Indirect Expenses" under the main group "Indirect Expenses" in your chart of accounts.

- Within the "Indirect Expenses" group, create two subgroups called "Site A Expenses" and "Site B Expenses" to represent your different sites.

- Then, under each subgroup, create separate ledgers for specific expenses like transportation, labor, and other relevant costs.

To link different groups in different categories, like connecting "Indirect Expenses of Site A" with "Sundry Debtors of Site A" or "Sundry Creditors of Site A," you can use a feature called Cost Centers in Tally.

- Set up Cost Centers for each site (Site A and Site B) under the appropriate ledgers.

- Whenever you make a transaction, assign the relevant cost center to specify which site it belongs to.

By using cost centers, you can generate reports that focus on a particular site, such as a report showing all the transaction types for Site A only. Tally lets you filter reports based on cost centers, making it easier to analyze data and track expenses for specific sites separately.

3. Usually, construction companies don't need to maintain stock because their main focus is on providing services and managing projects.

However, if your construction company also deals with buying and selling construction materials, equipment, or other stock items, then it becomes important to maintain stock records. Doing so helps you manage your inventory, keep track of costs, and ensure proper accounting for stock-related transactions.