Job Costing in Tally
Job costing is a type of specific order costing that applies to a job carried out in accordance with the needs and specifications of the customer.
For a single job, Tally.ERP 9 allows tracking cost and revenue information such as material, labour, and overhead in great detail.
Each job is given a job number or name so that the costs incurred for each may be determined.
The following are applications for job costing in the tally:
- To calculate the location-based true cost for each job
- To calculate the revenue and expenses, and subsequently the profit, for each work.
- To keep track of overhead expenses, assign them to each job
- To detect project loss at an early stage
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Features of Tally’s Job Costing in Tally ERP 9
Multiple jobs or projects can be created as cost centres, and a Tally can be used to track the expenses and income related to each project.
Distribute expenses while the work is being done. After finishing, contrast the selling price and profit with the projections. Based on the profitability of each task or project, make wise selections.
Job pricing is easy and efficient because of the following features:
- Monitoring the movement of materials between godowns.
- Monitoring the use of materials at several sites.
- Determining the net profit or loss for specific work or project or profitability.
- seeing the inventory movement summary (Opening, Inwards, Outwards, Transfer, Consumption etc.)
- using a single screen to compare each job’s cost, selling price, and profit to those of other jobs.
- Drilling down to the voucher level for transactions to be referenced or altered.
- Turn on the job costing feature.
- For businesses that keep accounts with inventories, job costing is one option.
- Cost centres and numerous godowns must be enabled for the company in order to implement job costing.
Activate job costs.
1. Select F11: Company Features from the Tally Gateway ( F1: Accounting features ).
2. Select Yes under the Maintain cost centres? option.
3. Turn on the use cost centre for the work costing option.
4. To save, press Ctrl+A.
Allow several godowns
1. Access the Tally Gateway > F11: Company Features ( F2: Inventory Features).
2. Select Yes to Maintain multiple Godowns.
3. To save, press Ctrl+A.
Note: Get a step-by-step guide with the help of the Online Tally Course.
Make Cost Centers Available for Job Costing
The choice to use cost centres for job costing will be offered in the cost centres once job costing has been enabled for the organisation. This option can be turned on either while creating or changing cost centres.
The Job Work Analysis report will provide the option to pick cost centres that have been enabled for job costing.
1. Access the Tally Gateway, Accounts Info, Cost Centers, and Create.
2. Type the cost centre’s name.
3. In the field Under, choose Primary or the necessary cost centre.
4. Change the Use for Job Costing setting to Yes.
Allow for job costing in godowns in Tally’s godowns
Job locations are created in ERP 9. The ability to set a project for job costing is accessible in the master after job costing for the firm has been enabled.
All supplies provided or received for work or project will be tracked once a godown is assigned, and the reports will reflect this.
1. Select Inventory Info. > Godowns > Create from the Gateway of Tally menu.
2. Type the location’s name.
3. Decide whether to categorise the location under Primary or the godown.
4. To skip Allow Storage of Materials, press Enter.
5. Decide on a job or project to set up for job costing.
6. Key in Enter.
7. To save the location, press Enter.
For job costing, utilise the Stock Journal Voucher class.
Create stock journal classes to track the movement of materials between godowns and the items used to calculate job costs.
1. Select Stock Journal under Accounts Info > Voucher Types > Alter.
2. To access the Voucher Type Class screen, enter Transfer as the Name of Class.
3. Turn on the Use Class for Inter-Godown Transfers check box.
4. Hit Enter.
5. Type “Consumption” as the class name.
6. Use Class for Job Costing Consumption should be enabled in step six.
7. Key in Enter.
The screen for changing the voucher type with the available classes looks like this:
8. To store the voucher type, press Enter.
So far, we have discussed the job costing in tally in detail. Join Tally Training in Coimbatore to become an expert in Tally software.