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Purchase of Goods and Services

In your business, you might need to purchase goods or services to fulfil the demands of your customers. You may do a simple cash purchase or purchase on credit. For each purchase transaction, you will need to keep a record of the items you bought, payments made, goods returned, and so on. Using TallyPrime, you can do all of these and more. Moreover, you can view reports any time to know about all the purchases made in your business and compare against the sales performance.

Generate purchase bills: Record a cash bill or invoice when you make an instant payment to the supplier, using cash or any other mode like cheque or credit/debit card. If it is purchase on credit, record a credit purchase by using the supplier ledger. There are also situations when you want your supplier to deliver goods to a specific location that is different from your billing address. TallyPrime handles all such needs of recording purchases and more.

Record additional charges, discounts, and free items: Your purchase transaction may include additional expenses, such as transportation charges, insurances, and taxes. If your supplier has given discounts on your purchases, you will need to record the discounts in your invoices. Similarly, if you have received free items or samples from your supplier, all of these can be recorded and tracked in TallyPrime.

Reports: In TallyPrime, you can track all the purchase bills using different reports, such as Purchase Register, Day Book, and so on. You can view your purchases across different periods, filter the data for specific details, configure the reports to view more purchase-related details, and more.

 

Record Purchase of Goods or Services

Whether you make a purchase on cash or credit, the procedure in TallyPrime remains similar. The only difference is that you will select cash or bank for cash purchases and the supplier ledger for credit purchases. You can record purchase of items using the Item Invoice mode and record purchase without items using the Accounting Invoice mode. TallyPrime also provides the flexibility to use these invoice modes interchangeably for recording purchases. You can also print the invoices with the necessary details, if needed.

  1. Open the purchase voucher screen.
    1. Gateway of Tally > Vouchers > press F9 (Purchase).
      Alternatively, press Alt+G (Go To) > Create Voucher > press F9 (Purchase).
    2. Press Ctrl+H (Change Mode) to select the required voucher mode (Item Invoice, in this case).
  2. Specify the supplier details.
    1. Supplier Invoice No. and Date: The invoice number and date should be the same as given in the corresponding sales bill.
    2. Party A/c name: Select Cash or Bank for cash purchases. For credit purchases, select the supplier ledger.
    3. Party Details: Enter the supplier’s name and address, if needed.
      If you do not see the Party Details screen, press F12 (Configure), and set Provide Receipt, Order, and Import details to Yes.
      Note: You may want to maintain specific details about your suppliers, such as address with landmark, alternative contact number, and so on, in the invoices. In such cases, you can create party ledgers with the required details. In the Suppliers field of Party Details screen, select the required ledger.
  3. Purchase ledger: Select the accounting ledger to allocate the stock items.
    If you do not see this field on the screen, press F12 (Configure) and set Select common Ledger Account for Item Allocation to Yes.
    In Accounting Invoice, you can select the purchase ledger under Particulars.
  4. Provide the stock item or service details.
    As in other transactions, you can create the item or ledger on the fly by pressing Alt+C.
    In Item Invoice, select the stock item, enter the Quantity. The Rate will be auto-filled, if available for the stock item. However, you may choose to enter the Rate or Amount.
    In Accounting Invoice, select the service ledger and enter the Amount.
  5. Select additional ledgers, like transportation charges, insurance, or discount, if any.
  6. Provide Narration, if needed, and accept the screen. As always, you can press Ctrl+A to save.

    What you see on the screen can vary based on your choices. Press F12 (Configure) to change the options and F11 (Features) to enable or disable features.
  7. Print the invoice.
    1. Press Alt+P (Print) > press Enter on Current.
    2. Press I (Preview) to check the invoice before printing, if needed.
    3. Press P (Print) to print.

The following is a sample preview screen of the purchase invoice.

Click here to see the possible F12 configurations.

Option

Description

General Options

Provide Receipt, Order, and Import details

(Address details, despatch details, etc.)

Record the Receipt, Order, and Supplier details. If you already have a receipt note and purchase order, the reference nos. for receipt and purchase order will appear for selection.

Select common Ledger Account for Item Allocation

Allocate items to a single or multiple ledger accounts.

Say you have both domestic items and exported items, and want to record them separately for tracking purpose. By enabling this option, you can allocate each item to the respective ledger account.

Use default Bill-wise details for Bill Allocation

Allocate the Supplier Invoice No. as the bill reference number for tracking against the sales invoice raised by the supplier. If no Supplier Invoice No. is available, the Voucher No. is used as the bill reference number.

Provide Additional Descriptions for Ledgers

Enter description for ledgers, such as mode of transportation, for reference. If you have already provided any description in the ledger master, it appears during voucher entry. You can add to or modify the existing description.

Provide Additional Descriptions for Stock Items

Enter description for stock items, such as warranty, motor capacity, and so on, for reference. If you have already provided any description in the stock items master, it appears during voucher entry. You can add to or modify the existing description.

Warn on negative Stock Balance

View a warning message when your stock balance is negative.

This helps you to plan your purchases to meet supply and demand of items. If you do not want to see any warning on negative stock balance, set this option to No.

Modify all fields during voucher entry

The default order/delivery note entries and price list rates, if available, appear during voucher entry. You can modify these values by setting this option to Yes.

Provide details to preclose order

Pre-close orders partially or completely from the Stock Item Allocation screen. Enabling this option displays the Pre-Close Quantity column after the Quantity column in the Stock Item Allocations screen.

Use Expired Batches for Stock Items

Restrict or allow selection of stock items from expired batches.

Show Batches with Zero Quantity

View batches that do not have any quantity, while allocating batches for stock items during voucher entry.

Provide Cash/Trade Discount

Enter the discount percentage or amount for each selected item during voucher entry, and show the total discount using a ledger account.

Show Turnover from selected Party A/c

If you want to know how has been your business relationship with your suppliers, you can view the total business turnover made with the suppliers till date.

Consolidate Qty of Stock Items with same Rate

If you have multiple receipt notes that include stock items of the same rate, you can view the consolidate quantity of stock items in the invoice.

Show Compound Unit of Items based on Rate

Show Quantity in the compound unit of item according to the rate per unit entered during voucher entry.

Say you have specified Kg of 1000 Gram as the unit for an item. During voucher entry, you entered the Quantity in Kg and rate in Gram. By setting this option to Yes, you will see the Quantity in Gram instead of Kg, because the Rate entered is per Gram.

Show details of Compound Unit

Appears when Show compound unit of item based on rate is set to Yes. Enabling this option shows the Quantity with all units of the compound unit specified for the stock item.

Say you have specified Kg of 1000 Gram as the unit for a item. During voucher entry, you have entered the Quantity as 1500 Gram and rate in Kg. By setting this option to Yes, you will see the Quantity as 1 Kg 500 Gram instead of 1500 Gram.

Importers’ Options

Provide Marks or Container No.

If you have purchased items that were imported, enter the marks and container details for such items to track such details in the report, when needed.

Provide No. of Packages

If you have purchased items that were imported, enter the number and kind of packages for the items to track such details in the report, when needed.

Bank Details

Print Cheque after saving Voucher

If you have made the payment using a cheque, you can print the cheque after saving the voucher.

Show Cheque details before printing

If you have opted to print the cheque after saving the voucher, you can choose to view a conformation message before printing.

Use default Bank Allocations

The bank allocations are set internally: Transaction Type as Cheque and Voucher Date as Instrument Date. You can use the default values by setting this option to Yes. In case you have used a different payment mode, set this option to No and modify the bank allocation details.

Use Auto Cheque Numbering

Use check numbers automatically from the cheque range specified in bank ledgers, in the Bank Allocation screen. By default, the first Cheque Range defined in the Bank ledger is considered for cheque numbering.

Select Cheque Range

Select from multiple Cheque Ranges defined in the Bank ledger.

Statutory Options

Calculate Tax on Current Subtotal

(else calculations are on Inventory Total only)

Calculate tax on the total amount after adding the additional income or expenses to the total item amount.

Modify Tax Rate details GST

You may or may not have defined the GST tax details at the company or master level. You can add or modify the details now, for each purchase transaction.

Export e-Way Bill details after saving Voucher

Export the e-Way Bill automatically as JSON file once you save the voucher. You canupload this JSON file on the government portal to get the e-Way Bill number.

Allow Tax difference up to

Ignore difference between computed tax and actual tax amounts up to a specified value.

For example, if you entered the value 1 here, the voucher accepts a difference of Rs. 1 between the computed tax and actual tax. If you did not enter any value here, the voucher considers the value as 0, and therefore no difference in computed tax and actual tax is allowed.

During voucher entry, if the difference exceeds the value in this field, TallyPrime displays a warning message.

Actual versus Computed Tax

The option appears when Allow tax difference up to is set to more than 1.

Greater: Difference between the computed tax and actual tax can be greater than the value entered.

Greater or Lesser: Difference between the computed tax and actual tax can be greater or lesser than the value entered.

Lesser: Difference between the computed tax and actual tax can be lesser than the value entered.

Modify Tax details for TDS

You may or may not have defined the TDS tax details at the company or master level. You can add or modify the details now, for each purchase transaction.

Show TDS Bill Allocations

Allocate TDS bills for calculation during voucher entry.

 

Use Less Paper Space for Printing

By default, TallyPrime prints invoices on A4 size papers. In certain cases, your transaction may involve more stock items, which can be printed by optimising the print space.

  1. In the sales invoice, press Alt+P (Print) > press Enter on Current.
  2. Press C (Configure) > type or select Optimise printing to save paper and press Enter to set it to Yes. This will print maximum information in the print area and save paper.
    Note: This option will appear only when:
    ♦ The Country selected for the company is India.
    ♦ The company is enabled for GST/VAT/TDS/TCS.
    ♦ The service tax and excise features are disabled.
  3. Press Esc to return to the Voucher Printing screen.
    Henceforth, all the sales invoice you print will continue to have the same print size, until you change the option in F12 (Configure) for invoice printing.
  4. In the Voucher Printing screen, press P (Print) to print the invoice on the paper used.

As the above invoice is printed by enabling the option Optimise printing to save paper, all the stock items are appearing on a single page. If this option was set to No, the same information would have printed in two pages.

 

Specify Separate Supplier and Consignee Details

In certain cases, you may want your supplier to deliver goods to a location different from your billing address. You can enter the delivery address as the consignee details when recording a purchase transaction in TallyPrime.

  1. In the Party Details screen of purchase invoice having the Supplier (Bill from) section, press F12 (Configure) > set Provide separate Buyer and Consignee details to Yes.
    Henceforth, you can add both the consignee and supplier details in every purchase invoice, until you change the option in F12 (Configure) of the invoice.
  2. Enter the Consignee and Supplier details.

    What you see on the screen can vary based on your choices. Press F12 (Configure) to change the options.
  3. Accept the screen. As always, you can press Ctrl+A to save.

When you print the invoice, the consignee name and address where the supplier will deliver the consignment or goods will be printed.

 

Purchase of Items with Discounts

You may have received discounts from the supplier on the total item amount or on each amount separately. Using TallyPrime, you can record all such discounts. You can also record the item-level discounts as either indirect incomes or rate discounts.

In this section

 

Purchase with discount on total item amount

If you have received discounts on items from your supplier, say on purchase of items worth Rs. 10,000 or more, you can account for such discounts while recording your purchase invoice.

  1. In the purchase invoice, after you have selected the stock items, press Enter twice to skip one line.
    Alternatively, press Enter > Spacebar > and select End of List.
    This takes you to the next line in the screen where you can now select the discount ledger.
    In Accounting Invoice, select the discount ledger.
  2. Provide details of the discount.
    1. Select the ledger for discount created under Indirect Incomes, say Discount Received.
    2. Enter the discount percentage (%) under Rate as a negative number (in minus, for example, -12%). TallyPrime applies the discount to the total item amount and displays the discount amount against the selected discount ledger.
      Alternatively, you can enter the Amount.
  3. Enter the remaining details and accept the screen. As always, you can press Ctrl+A to save.

    What you see on the screen can vary based on your choices. Press F12 (Configure) to change the options and F11 (Features) to enable or disable features.

TallyPrime calculates the invoice total by subtracting the discount from the total amount for the items.

If your supplier calculated the discount after including additional charges, such as transportation, press F12 (Configure) > set Calculate Tax on Current Subtotal to Yes.

Henceforth, when you select the discount ledger, the discount will be applied to the total amount after including any additional charges, until you change the option in F12 (Configure) of the invoice.

 

Purchase with trade discount

Based on your business terms with your supplier, you may get discounts on certain items depending on the quantity or supply. To record a sale with such trade discounts, you can show the discount percentage against the quantity of the item. You can also enter the discount percentage or amount for each item, and book the total discount as indirect income in your purchase invoice. See more…

Say, you have purchased 100 pcs of Item A from a supplier. The standard buying price for this item is Rs. 100 each. Since this was a bulk purchase of 100 pcs, your supplier offered a discount of 10% on the item rate.

You can record this discount received in two ways:

  1. You can enter the discount % along with the item. The total item amount will appear as Rs. 9,000 for all 100 pcs of Item A. Here, as the item amount is changed to Rs. 9,000, this amount will be booked as purchase.
  2. You can create a discount ledger for 10% as an indirect income and use it to calculate the total discount. That means, your per-item rate will show Rs. 100 and therefore Rs. 10,000 for all 100 pcs. The discount received for 100 pcs of the item will appear as Rs. 1,000, and the total payable at the end of the voucher will appear as Rs. 9,000.

In this section

 

Enter discount percentage against each item – without using ledger account

  1. Press F11 (Features) > set Use Discount column in invoices to Yes.
    If you do not see this option, set Show more features to Yes.
    Henceforth, you will see the Disc % column in every purchase invoice.
  2. In the purchase invoice, after you have provided the Quantity and Rate, enter Disc % for the selected item.
    The Amount for the given quantity of the stock item is displayed after deducting the discount, without showing any change in the Rate.
  3. Enter the remaining details and accept the screen. As always, you can press Ctrl+A to save.
    The discounted item amount appears against each item.

 

Enter discount percentage and amount on item rates – using ledger account

  1. In the purchase invoice, press F12 (Configure) > set Provide Cash/Trade Discount to Yes.
    If you do not see this option, set Show more configurations to Yes. If the option does not appear, press F11 (Features) > enable the statutory options applicable for your business.
  2. After you have entered the Amount of the stock item, in the Discount field, enter the discount percentage that you have received for that item.
    This automatically calculates the discount and displays the amount in the next field.
    Alternatively, press Enter to leave the first field blank and enter the discount amount in the next field.
  3. Select the discount ledger created under Indirect Incomes.
    Ensure that in the discount ledger, the option Type of ledger is set to Discount.

    What you see on the screen can vary based on your choices. Press F12 (Configure) to change the options and F11 (Features) to enable or disable features.
  4. Enter the remaining details and accept the screen. As always, you can press Ctrl+A to save.

The total discount amount appears against the selected discount ledger. This amount is the sum of the discounts displayed under each stock item.

 

Purchase with Free items

When you make a purchase, you might receive a few items for free from the supplier. For example, if you had placed an order for 12 pcs of an item, the supplier might have billed you for only 10 pcs and given the remaining 2 pcs without any additional cost. Alternatively, the supplier might have billed you for all 12 pcs, and sent 2 additional pcs of the same item or a different item as samples. In TallyPrime, you can account for such purchases in different ways during voucher entry.

In this section

 

Account for free items using Actual and Billed quantities

  1. Press F11 (Features) > set Use separate Actual and Billed Quantity columns in invoices to Yes.
    If you do not see this option, set Show more features to Yes.
    Henceforth, you will see the Actual and Billed columns under the Quantity column in every purchase invoice.
  2. Actual: Enter the quantity purchased from the supplier, say 12 nos of the item.
  3. Billed: Enter the quantity for which you will pay the supplier, say 10 nos of the same item.

    What you see on the screen can vary based on your choices. Press F12 (Configure) to change the options and F11 (Features) to enable or disable features.
  4. Enter the remaining details and accept the screen. As always, you can press Ctrl+A to save.

The total amount calculated is based on the billed quantity; however, the items supplied to you are based on the actual quantity, which includes the free items.

 

Account for free items using zero-valued transaction

  1. Gateway of Tally > Alter > Voucher Type > select Purchase > and press Enter.
    Alternatively, press Alt+G (Go To) > Alter Master >Voucher Type > select Purchase > and press Enter.
  2. Set the option Allow zero-valued transactions to Yes.
    Henceforth, you can enter stock items without entering the Rate (zero value) in every purchase invoice.
  3. In the purchase invoice, provide details of the items – Quantity, Rate, and Amount – that you have been billed for.
  4. Select the same item again or a different item, as supplied to you, and enter the Quantity. Leave the Rate and Amount fields blank.

    What you see on the screen can vary based on your choices. Press F12 (Configure) to change the options and F11 (Features) to enable or disable features.
  5. Enter the remaining details and accept the screen. As always, you can press Ctrl+A to save.

The invoice generated displays the billed items with the Amount details, along with the total quantity received from the supplier.

Note: TallyPrime also provides you the flexibility to record purchase transactions only for zero-valued items, such as free items or samples received from suppliers.

 

Purchase of Fixed Assets

If you are purchasing fixed assets (for example, furniture) which you do not trade in, you can record such purchases in TallyPrime.

For example, the fixed asset was purchased for 5,00,000, and the depreciation was accounted as 4,60,000. The value of the fixed asset was 40,000. It was then sold for 50,000 (at a profit of 10,000).

  1. Open the purchase voucher screen, and press Ctrl+H (Change Mode) to select the required voucher mode (Accounting Invoice, in this case).
  2. Specify the supplier details.
  3. Provide the fixed asset details.
    1. Select the ledger grouped under Fixed Accounts.
    2. Enter the amount.

      What you see on the screen can vary based on your choices. Press F12 (Configure) to change the options and F11 (Features) to enable or disable features.
  4. Provide Narration, if needed, and accept the screen. As always, you can press Ctrl+A to save.

This value will appear in the Balance Sheet.

 

You can record the same transaction in voucher mode, as per your business needs.

  1. Open the purchase voucher screen, and press Ctrl+H (Change Mode) to select the required voucher mode (As Voucher, in this case).
  2. Credit the party or cash/bank ledger.
  3. Debit the fixed asset ledger.
  4. Accept the screen. As always, you can press Ctrl+A to save.

 

Track Stock Item Cost in Purchases

When multiple stock items are purchased and the expense is charged as a lump-sum amount, you may want to allocate such expenses to each stock item. In TallyPrime, you can automate the allocation of such expenses to stock item on a predefined basis.

Note: The additional costs reflect only in the stock value. It will not affect the accounts.

In this section

 

Enable expense ledger to track additional costs of purchase

  1. Enable the purchase voucher type to track the additional costs on purchase.
    1. Gateway of Tally > Alter > Voucher Type> type or select Purchase > and press Enter.
      Alternatively, press Alt+G (Go To) > Alter Master >Voucher Type > select Purchase > and press Enter.
    2. Set the option Track Additional Costs for Purchases to Yes.
    3. Press Ctrl+A to save.
  2. Enable the expense ledger to track the additional costs on purchase.
    1. In the expense ledger, press F12 (Configure) > set Select Appropriation Methods to allocate Additional Costs to Yes.
    2. In the expense ledger select the Method of appropriation in purchase invoice as Appropriate by Qty.
  3. Press Ctrl+A to save the expense ledger.

The additional costs/expenses incurred can be allocated to each item based on Quantity or Value.

 

Track additional costs in purchase invoice

You can automate the allocation of expenses to each stock item in the invoice mode. If you want to manually allocate the expenses, you can record the transaction in voucher mode.

  1. In the purchase invoice (press Ctrl+H and select Item Invoice mode), select the required stock items.
  2. Select the additional expenses ledger and enter the amount.
  3. Press Ctrl+A to save.
  4. Press Page Up to view the same transaction in alteration mode.
  5. Press Ctrl+H (Change Mode) and select the voucher mode (As Voucher in this case). The purchase voucher with additional expenses apportioned automatically, appears as shown below:

    You can manually enter the percentage of allocation or change the amount as needed. The same details will appear in Stock Summary.
  6. Press Alt+G (Go To) > type or select Stock Summary.
    Alternatively, Gateway of Tally > Stock Summary.

 

Reports | Know Your Purchases

Businesses require real-time updates on the day-to-day purchases. This helps in keeping track of the stock availability. Tracking purchases day-wise, month-wise, or for any period provides insights on the overall purchase, returns if any, payment dues, and so on. TallyPrime provides different reports to get purchase-related data to analyse and make informed decisions for the business.

In this section

 

Day Book

This report tracks all your transactions on a day-to-day basis. You can filter this report to check all the purchase transactions made on a particular day.

  1. Press Alt+G (Go To) > type or select Day Book.
    Alternatively, Gateway of Tally > Display More Reports > Day Book.
    By default, this report displays all the transactions as of the Current Date displayed on the Gateway of Tally screen.
  2. To view the purchases recorded on any given day:
    1. Press F2 (Date) to change the date.
    2. Press F4 (Voucher Type) > select Purchase.

This report lists all the purchase transactions recorded on the selected date. For more information, refer to the topic Day Book.

 

Purchase Register

This report provides a comprehensive view of the month-wise purchases done in your business. You can drill down from the selected month to view the voucher-wise listing of purchases. You can further configure the report to view the data for different periods and represent the purchase details in different ways, based on your business needs.

  1. Press Alt+G (Go To) > type or select Purchase Register.
    Alternatively, Gateway of Tally > Display More Reports > Account Books > Purchase Register.
  2. Scroll Up or Down and press Enter to view purchase vouchers recorded in the selected month.

 

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