Top 55+ Most Asked Tally Interview Questions and Answers

1) What is Tally, and where is it used?

Tally is an accounting and inventory management software package mainly used to record day to day business data of an organization. It is complete enterprise software for small and medium enterprises. The latest version of Tally is Tally ERP 9, which also has several latest subversions released from time to time.

• Tally software can perform all basic accounting functions of an organization. This software can be integrated with other business applications like Inventory, Finance, Sales, Payroll, Purchasing, etc. Tally software is used to perform the following tasks:
• It can be used to store all the business transactions of each account in detail.
• It is the best choice for small-scale enterprises, carries out efficient business transactions, provides accuracy, and saves a lot of time.
• It can also manage payroll and estimate job costing.
• It is used to store details and manage inventory items, file a tax return, manage profit and loss statements, prepare a balance sheet, VAT forms, trial balance, cash-flow report, etc.
• Tally can manage the data over different locations and synchronize it.

2) What are the most prominent features of Tally software?

Most prominent features of Tally software are:

• Tally is considered the best software because it is easy to use, has no codes, robust and powerful, executes in real-time, operates at high speed, and has full-proof online help for any organization.
• Tally is multi-lingual software that supports several languages of the world. In Tally, you can also maintain accounts in one language and view reports in other languages.
• Using the one licensed version of Tally software, you can create and maintain accounts for upto 99,999 companies.
• Using the feature of payroll, you can automate employee records management.
• Tally has the synchronization feature, so the transaction maintained in multiple locations offices can be updated automatically.
• Tally is used for generating consolidated financial statements as per the company's requirements.
• We can use Tally software to handle financial and inventory management, invoicing, sales and purchase management, reporting, MIS etc.
• The feature of Tally customization makes the software suitable for distinctive business functions

3) What are the key advantages of Tally Software?

Key Advantages of Tally Software)

• Tally software provides data reliability and security. In Tally, the entered data is reliable and secure.
• Several company calculations and financial records that include net deduction, net payment, bonuses, and taxes that need to be made while disbursing salary to employees can be maintained using Tally.
• Tally reduces the chances of error to a great extent
• Tally is self-explanatory and easy to learn. You can learn it at home or at designated institutes.
• Tally is cost-effective and time-saving. It also ensures accuracy in business management. Manual calculations are time-consuming; that's why all organizations use Tally.
• Tally enables the digitalization of bills and signatures, thus staying up-to-date with the latest technology.
• Using the Tally software, even a small shop owner can manage his store, keep records of customer bills, and manage financial transactions efficiently.

4) What are the two pre-defined ledgers available in Tally ERP 9 software?

Following are the two pre-defined ledgers available in Tally ERP 9 software:

• Cash: In this pre-defined ledger group, a cash-in-hand ledger is created. We can enter the opening balance as on the books beginning from.
• Profit and Loss Account: This pre-defined ledger is created under the group Primary. In this ledger, we enter the previous year's profit or loss as the opening balance of this ledger.

5) What are the types of the ledger we can create in Tally ERP9?

We can create the following types of ledgers in Tally ERP9:

• We can create a sales/purchase ledger.
• We can create an Income/Expense ledger.
• We can create a party ledger.
• We can create a tax ledger.
• We can create a bank account.
• We can create current liabilities.

6) What are the options available in the Accounts books menu in Tally ERP9 software?

The following options are included in the Accounts books menu in Tally ERP9 software:

• Sales Register
• Purchase Register
• Journal-Register
• Cash Book
• Bank Book
• Ledger
• Group Summary

7) What is the main purpose of a statement of inventory in Tally?

The main purpose of a statement of inventory in Tally is to view the inventory information based on godowns. It tracks details of items in inventory, carries stock, and checks budget variations according to the forecasts, plans, statistics, etc. It is also used to display, modify and print reports like Tally accounting.

8) What is a group in Tally ERP 9 software?

In Tally ERP 9 software, a group can be defined as a compilation of ledgers of the exact nature. For example, expenses like telephone bills, electric bills, conveyance, etc., are usually included in groups. Ledger of these expenses is shaped to be used while accounting vouchers are entered.

9) What are the key differences between Tally 7.2 and Tally ERP 9?

Tally 7.2 and Tally ERP 9 are both software products from Tally Solutions Pvt. Ltd. Tally 7.2 is an Integrated Enterprise Solution that provides capabilities related to accounting, inventory and reporting, while Tally ERP 9 is an upgraded version of Tally 7.2 that contains some extended functionalities and provides many features like Excise for Dealers, Payroll, TDS, etc. Following is the list of key differences between Tally 7.2 and Tally ERP 9:

10) What do you understand by reversing journal entries?

Reversing journal entries specifies those made at the start of an accounting period to withdraw the adjusting journal entries completed at the end of the earlier accounting period.

11) What types of vouchers can be created in Tally ERP 9? What are the shortcuts for creating these vouchers?

Following are the different types of vouchers that can be created in Tally ERP 9:

• Contra Voucher: This voucher is used to point to the transfer of funds from a bank account to the cash account or cash account to a bank account or in a different bank account of another bank. The shortcut key for creating this voucher is F4.
• Payment Voucher): This voucher explains the historical payments on each account like payment of salary, rental, etc. The shortcut key for creating this voucher is F5.
• Receipt Voucher): This voucher describes the transactions that relate to payments received. The shortcut key for creating this voucher is F6.
• Journal Voucher): This voucher is used to cover the expenses to maintain the organization's running costs. The shortcut key for creating this voucher is F7.
• Sales/Invoice Voucher: This voucher describes the sales made. It also displays the sale invoice. The shortcut key for creating this voucher is F8.
• Credit Note Voucher: Entry is made in this voucher when a customer returns the products which weren't correctly dispensed. The shortcut key for creating this voucher is Cntrl+F8.
• Purchase Voucher): This voucher is for items purchased for running the business like raw materials, etc. The shortcut key for creating this voucher is F9.
• Debit Note Voucher): This voucher is used for keeping records when goods are returned to suppliers due to any damages. The shortcut key for creating this voucher is Cntrl+F9.
• Reversing Journals): This voucher is a special entry that gets automatically reversed after the date of the issue. The shortcut key for creating this voucher is F10.
• Memo Voucher): This voucher is used to mark the unknown expense at a moment which can be converted to an actual sale voucher or deleted. The shortcut key for creating this voucher is Cntrl+F10.

12) What do you understand by deferred tax liability? Deferred taxation is a part of which equity?

Deferred tax liability is a listing on a company's balance sheet that records taxes that are owed but are not due to be paid until a specific future date. It is called deferred tax liability because of the difference in timing between when the tax was accrued and when you have to pay it. Deferred taxation is a part of the owner's equity.

13) What shortcuts are used for voucher creation and alteration screen in Tally ERP9 software?

In Tally ERP9 software, you have to enter Alt+C to create any master (ledger, stock item) on the voucher or alteration screen. If you want to alter or con?gure any master item on a voucher, you must select a speci?c ledger or stock item on the sales voucher screen and press the Ctrl+Enter buttons.

14) Which types of things come under Intangible Assets?

The following types of things come under Intangible Assets:

• Copyrights
• Trade Marks
• Domain Names
• Patents
• Brand Names etc

15) What shortcut is used to repeat the narration on a voucher?

The shortcut to repeat the narration on a voucher is Ctrl+R.

16) What is trial balance in accounting?

A trial balance is an accounting report that records the credits in each of the universal ledger accounts of an organization. It is done at the end of posting journal entries to ensure that there is not any posting bug.

17) How can you copy text from Tally?

You can use the shortcut (Ctrl+Alt+C) to copy text and the shortcut (Ctrl+Alt+V) to paste the copied text.

18) Where do the accrued expenses appear on the balance sheet?

The accrued expenses are frequently short-term and appear within the "current liabilities section" of the balance sheet.

19) What is the shortcut to recalling the last narration in Tally?

The shortcut to recall the last narration in Tally is (Alt+R).

20) What kinds of vouchers are used in Tally ERP software?

The kinds of vouchers used in Tally ERP software are:

• Debit note Voucher
• Credit note Voucher
• Memo Voucher
• Sales Voucher
• Payment Voucher
• Contra Voucher
• Receipt Voucher
• Journal Voucher
• Reversing Journals etc.

21) How can you see the profit and loss statement in Tally ERP9?

To check the profit and loss statement in Tally ERP9, we should press F1): Complete, which will show the data based on the non-payment primary groups with every transaction that has been entered directly.

22) What are some available statutory features in Tally ERP?

Following is a list of some available statutory features in Tally ERP):

• Service Tax
• Value Added Tax
• Goods and Service Tax
• Excise Tax
• Payroll Statutory
• The tax collected at the source
• Tax deducted at source etc.

23) What information does the directory store when you create a company in Tally ERP 9?

When we create a company in Tally ERP 9, the directory in Tally ERP 9 specifies the path where the company data is stored.

24) What is the use of a Statement of Inventory?

The Statement of Inventory is used for the following reasons:

• To visualize the reports on Inventory according to the Godowns.
• To track the details of items according to the Inventory.
• To query on stock and check out the budgets estimates and plans, statistics, etc.

25) What is the setup process for employees in Tally ERP 9 for their payroll?

Tally ERP 9 provides a great facility to create the required groups and classify them into different categories such as Employee categories, Employee groups, and Employees for smooth processing of employees' salaries.

How to create an Employee group?

• First, go under the employee group creation screen and select Primary Cost Category as the Category.
• After that, name the employee's group "Sales".
• Now, select the group as "Primary" and click on accept to finish with employee group creation.
• This is how the employee group is created.

How to create the Employee Master?

• First, go to the employee master.
• Here, you can incorporate the information about the employees like constitutional details, passport & visa, appointments letters, etc.

26) What is the key difference between the Standard Tally Driver and the Tally Text Driver?

The key difference between the Standard Tally Driver and the Tally Text Driver is that the Standard Tally Driver can print graphics, True Type fonts as graphics, and printer-resident fonts. On the other hand, the Tally Text Driver can print only printer-resident fonts.

27) What is trial balance, and what is the process to check the trial balance in Tally ERP 9?

Trial balance is mainly a list of all the general ledger accounts within the ledger of a business. This list consists of the name of each nominal ledger account and the value of that nominal ledger balance. Each nominal ledger account contains either a debit balance or a credit balance. All debit and credit balances are kept and compiled into the debit and credit account column. Every organization prepares a trial balance periodically, usually at the end of every reporting period.

Trial Balance is a way to verify that the journal entries are entered correctly in the general ledger. In the debit and credit column, all debit balances should be equal to the total of all the credit balances.

28) What is the shortcut to cancel a daybook of vouchers in Tally ERP9?

In Tally ERP 9 software, the shortcut to cancel a daybook of vouchers is (ALT+X).

29) What is the default configuration of Tally ERP 9 provided for the balance sheet?

In Tally ERP 9, a balance sheet displays two different columns, i.e., Liabilities and Assets. An organization needs to display the closing balances of all the primary groups and capital accounts and the net profit for a specified period on the balance sheet.

30) What do you understand by Rally Tally?

Rally Tally is a place to find, publish, and coordinate civic events.

31) How can we view the Books of Accounts in Tally ERP 9 software?

We can view the Books of Accounts in Tally ERP 9 software by pressing the D button at the entry of Tally ERP 9 to pull the Display menu. We have to press the A button to bring up the Accounts Books menu on the display menu.

32) What do you understand by the reversing journals in Tally ERP 9?

In Tally ERP 9, the reversing journal is a defined entry that is reversed automatically after the date of the issue.

33) Which function is used to convert the data in encrypted form in Tally ERP 9?

We can use Tally Vault's function to convert the data into an encrypted form in Tally ERP 9.

Follow the steps given below to utilize the Tally Vault:

• First, go to the gateway of Tally and press F3.
• Here, you can choose the company for which you want to encrypt the data.

34) What is the use of contra vouchers in Tally ERP 9?

In Tally ERP 9, a contra voucher is used to provide details of the transfer of funds from a bank account to a cash account and/or vice versa.

35) How can you migrate TCP from Tally 7.2 to Tally 8.1?

You should follow the steps given below to migrate TCP from Tally 7.2 to Tally 8.1:

• First, go to Start > Programs > Tally 8.1 > TallymigrateData.
• Here you will see two splash screens, Tally Data Migration Tool and Tally 8.1.
• Now, choose 'Migrate TCP' from the Tally Data Migration Tool Menu.
• When you choose the 'Migrate TCP', the tool starts to procedure the Tally 7.2 TCP and produces another TCP, which is well-matched with Tally 8.1.

36) How can you create multiple ledgers in Tally ERP 9?

Follow the steps given below to create multiple ledgers in Tally ERP 9 software:

• First, start with Accounts Info on the Gateway of Tally and choose Ledgers. After that, locate Multiple Ledgers and click on Create.
• After completing the above step, enter the details for Under Group and update information like the name of ledgers on the Multi Ledger Creation screen.
• In the end, press the Enter button and accept yes. After that, it will create multiple ledgers.

37) What are the main functional enhancements in Tally ERP 9 software?

Following are the main functional enhancement included in Tally ERP 9 software:

Accounting Voucher: This is a newly enhanced feature included in Tally ERP 9 software. A new kind of numbering feature added to the voucher ensures that the vouchers are numbered successively.

VAT Option): It facilitates users to record numerous items with diverse VAT rates by configuring the setting of "Default Accounting Allocations for Selected Item in Invoice."

Credit Limits): It is used to control the position of a party ledger that will not be functional on the sales order. It sends a warning notification as a pop-up on the credit limit, and the user can still save the voucher.

Payroll: Payroll is the newly introduced feature in TALLY ERP 9 that facilitates users to set their salary according to the National Pension Scheme.

CST: It provides users a facility that, even in an accessible format, the CST form details entered in the invoice will get printed.

Inventory Vouchers: It allows users to bring up the Godown address and print the name for the inventory section.

E-mailing option): It provides the facility that the customers can send accounting reports to several recipients and additional abilities like Net-banking and printing in a different format.

38) How can you view the profit and loss statement in Tally ERP 9 software?

You can easily view the profit and loss statement in Tally ERP 9 software by following the steps given below:

• Click the F1) Detailed, and it will display the information based on the default primary groups.
• Every transaction/voucher that you enter is updated instantly.

39) What is depreciation?

Depreciation is a process specifying that the value of an asset decreases when it is being used.

40) How can you generate the schedule VI profit & loss account using the auditors' edition of Tally ERP 9 software?

We can generate the schedule VI profit & loss account using the auditors' edition of Tally ERP 9 software by following the steps given below)

• First, go to the gateway of Tally -> Audit & Compliance -> Financial Statements ->Profit & Loss account
• After that, press the Ctrl+3 to load the previous year's company to generate the Schedule VI profit & loss account with two years' data.

41) What do you understand by a bank reconciliation statement?

A bank reconciliation statement specifies the banking & business activity and reconciles an entity's bank account with its financial records. It refers to a statement prepared when the passbook balance has a difference from the cash book balance. It also confirms that payments have been processed and cash collections have been deposited into a bank account.

42) What are the requirements to connect Tally ERP 9 remotely?

Remote connectivity for Tally ERP 9 is a very useful feature. There are two ways to connect Tally ERP 9 remotely) the customer end and the remote location. You must have the following requirements to connect Tally ERP 9 remotely):

At the Customer end

• It is required to have a valid internet connection.
• You must need a licensed version of Tally ERP 9 with a Tally.NET subscription.
• Create and authorize remote users for a company you want to operate remotely.
• Connect the company to the Tally.NET for remote access load.

At the remote location

• It is required to have a valid internet connection.
• You must have a licensed version of Tally ERP 9 software.
• You must have a valid password and user ID to access the software properly.

43) Which shortcut is used to select the credit note voucher in Tally ERP 9 software?

We have to press F8 (Ctrl + F8) to select the credit note voucher in Tally ERP 9 software.

44) Which shortcut is used to retrieve the last line you removed in Tally ERP 9 software?

We can use the shortcut Ctrl+U to retrieve the last line, which we have removed in Tally ERP 9 software.

45) What shortcuts are used to duplicate a voucher and add a voucher in Tally ERP 9 software, respectively?

We can use the following shortcuts to solve the above problems:

• To add a voucher: We can use shortcut keys Alt+
• A. To duplicate a voucher): We can use shortcut keys Alt+2.

46) Where can we find the sales tax on the balance sheet in Tally ERP 9 software?

In Tally ERP 9 software, sales tax appears as one of the liabilities for the business. It appears on the liability side of the balance sheet. Before inserting sales tax in liability, you can check where sales tax appears in the trial balancing sheet.

47) Which shortcut is used to cancel a daybook or a list of vouchers in Tally ERP 9 software?

The ALT+X shortcut is used to cancel a daybook or list of vouchers in Tally ERP 9 software.

48) What is the Ctrl + N shortcut usage in Tally ERP 9?

In Tally ERP 9, the Ctrl + N shortcut opens the calculator.

49) What do you understand by the delivery notes?

A delivery note is a record that goes with a product's shipment. It includes the details about the goods delivered. A delivery note indicates the content of a package. It also shows the details of the products if a few requested products are not enclosed because of the absence of stock or due to any other reason.

50) What is the shortcut to filter the information based on the monetary value from all report screens in Tally ERP 9?

We can use the shortcut Alt+F12 to filter the information based on the monetary value from all report screens in Tally ERP 9.

51) Which shortcut is used to check the company statutory details in Tally ERP 9?

We can check the company statutory details in Tally ERP 9 by using the shortcut Ctrl+Alt+B from any screen.

52) What is the Tally Data Migration Tool usage, and how does it work?

The Tally Data Migration Tool migrates the data from Tally 7.2 to Tally 8.2. It works with the Tally 8.1 exe and facilitates us to migrate company data (Masters, Vouchers, and Reports). This tool also facilitates the migration of TCP (Tally Compliant Product) files.

53) What features can we use to convert data in encrypted form in Tally ERP9?

We can use the function Tally Vault feature to convert data into an encrypted form in Tally ERP 9. We should follow the steps given below to use the Tally Vault:

• First, go to the gateway of Tally and press F3.
• Here, you can select the company for which you want to encrypt the data.
• A person must have a valid password to view those encrypted data.

54) Which shortcut is used to select the voucher type for a purchase order in an advanced Tally version?

To select the voucher type for a purchase order in an advanced Tally version like Tally ERP 9, we can use a shortcut ALT+F4 at accounting and inventory voucher creation and altercation screens.

55) Which shortcut is used to copy and paste text from Tally ERP 9?

The shortcut used for copying a text from Tally ERP 9 is Ctrl+Alt+C. We can use the shortcut Ctrl+Alt+V to paste that text.

56) How can you activate the GST in Tally ERP 9 software?

In Tally ERP 9 software, we can find the GST feature under Statutory and Taxation. We should follow the steps given below to activate the GST in Tally ERP 9):

• First, go to the screen for Company Operation Alteration, enable GST and choose set/alter GST details.
• After that, update all the necessary details like name of the state, registration type, the GSTIN which will be printed on invoices, date applicable from, periodicity, e-way bill applicability, the tax liability on receipts, GST rate, and all classifications.
• Now, accept the changes and save them.
• Now, GST is activated. All the GST features are automatically available for general ledgers, stock items, and transactions in Tally ERP 9.

57) Where can you see the errors that arise while migrating data from Tally 7.2 to 8.1?

Any error while the migration process is stored into a file called 'migration. err', which is automatically generated by Tally. You can see this file in the application folder of Tally.