Type of Ledgers:
Ledger Group for Assets:
Fixed Assets:
The word fix indicates that these assets won’t be sold in the current bookkeeping year.Examples of fixed assets are buildings, furniture, office equipment, machinery etc. This fixed asset is useful in calculating overall revenue of the company.Fixed assets are classified into two main types: Tangible and Intangible Assets.
Tangible Fixed Assets:
Tangible Assets are the assets that you can touch for example, buildings, land, hardware, various equipment, vehicles, furniture etc.
Intangible Fixed Assets:
Intangible Assets means assets which can not be touched. For example: goodwill of your business, licenses, registered or trademarked names, and even phone numbers, any innovation, and websites if you ever plan to sell.
Current Assets:
Current Assets are the assets which are expected to be converted to cash within a year. Current assets include cash, cash equivalents, accounts receivable, stock inventory, marketable securities, pre-paid liabilities etc.
It is a grouping of all accounts related to customers to whom goods have been sold on credit. Sum of all the money owed to a business by their customers is shown here and is termed as Accounts Receivable, Trade Debtors or Sundry Debtors.
Sundry Creditors
Accounts related to sellers from whom goods have been purchased on credit. Sum of all the money owed by a business to their sellers is shown here and is termed as Accounts Payable, Trade Creditors or Sundry Creditors.
Direct Expenses:
Direct as the word suggests are those expenses which are completely related and assigned to the core business operations of a company. They are mainly related to purchases and production of goods/services. Direct expenses are a part of the prime cost or the cost of goods/services sold by a company.
Direct expenses are directly related to the production of the product sold or service rendered, they may differ for different types of companies, such as manufacturing companies, construction companies, service companies, etc.
Direct expenses are shown on the debit side of a trading account.
Examples of Direct Expenses
Wages
Factory rent
Cost of raw material
Premises renting
Fuel
Carriage inwards
Indirect Expenses
Unlike direct, indirect expenses are not directly related and assigned to the core business operations of a firm. Indirect expenses are necessary to keep the business up and running, but they can’t be directly related to the cost of the core revenue generating products or services.
Just like direct expenses, indirect expenses can also be different for different types of organisations. These are usually shared costs among different departments/segments within the firm.
Indirect expenses are shown on the debit side of an income statement.
Examples of Indirect Expenses
Salaries
Telephone bills
Printing and stationery
Legal and Accounting charges
Carriage outwards
Difference between Direct and Indirect Expenses
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Direct Expenses |
Indirect Expenses |
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1. Expenses or direct costs incurred while manufacturing the main product or service of the company are termed as direct expenses. |
1. Expenses or indirect costs which are notdirectly related to the core product or service of the company are termed as indirect expenses. |
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2. They become a part of the total cost of goods/services sold. |
2. Indirect expenses are not included in the total cost of goods/services sold. |
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3. Shown on the debit side of a trading account. |
3. Shown on the debit side of an income statement. |
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4. Direct expenses can be allocated to a specific product, department or segment. |
4. Indirect expenses are usually shared among different products, departments and segments. |
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5. Examples – Direct labour or wages, cost of raw material, power, rent of factory, etc. |
5. Examples – Printing cost, utility bills, legal and consultancy, etc. |
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Ledger Group |
Ledger Name to be created |
Descriptions |
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Capital Account |
Capital Account |
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Partners /Owners Drawings A/c |
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Share Capital A/C |
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Partner's Current Account |
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Current Asset |
TDS Paid |
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TCS Paid |
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Goodwill |
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Bills Receivable |
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Accrued Income |
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Prepaid Insurance |
To account the insurance paid for the next Financial year. |
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Income Tax Advance |
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Bank Accounts |
Bank Accounts |
All bank account Current account, OD Account, CC Account, savings accounts etc. For Axis Bank A/c |
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Bank OCC Account |
Bank CC Accounts |
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Bank OD Account |
Bank OD Accounts |
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Cash- In - Hand |
Petty Cash A/c |
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Cash A/c |
default account |
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Loans & Advances (Asset) |
Salary Advance |
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Loans to sister concern |
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Loans to director |
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Loans to partner |
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Stock in hand |
Opening Stock |
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Closing Stock |
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Sundry Debtors |
Customer Ledger |
All customers ledger who buys products or services from business |
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Current Liabilities |
Bills Payable |
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Outstanding Expense |
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Lease Payable |
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Income Tax payable |
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GST Payable |
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TDS Payable |
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TCS Payable |
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Expense Payable |
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Divident Payable |
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Unearned Revenue |
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Duties & Taxes |
Sales Tax A/c |
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Output Vat |
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Input Vat |
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TDS Account |
Eg: TDS on Interest |
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TCS Account |
Eg: TCS on Motor vehcile |
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Excise Duty |
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CST A/c |
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Service tax |
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CGST |
Type of duty should be gst |
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SGST |
,, |
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IGST |
,, |
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UGST |
,, |
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CESS |
Tax type selected cess |
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Provisions |
Provision for Bad Debts |
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Audit Fee Payable |
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Salary Payable |
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Wages Payable |
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TDS Payable |
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TCS Payable |
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Compound tax payable |
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Income Tax Payable |
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Telephone charges Payable |
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Rent Payable |
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Sundry Creditors |
Supplier Ledgers |
The supllier from whome you purchase raw materials and other thng for business in credit. |
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Direct Expense |
Wages Account |
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Repair & Maintenance |
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Freight Paid |
Freight paid for the purchase of materials for selling or manufacturing |
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Factory Lighting |
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Factory Rent |
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Import Duty |
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Royalty |
For Mining, leasing etc |
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Labor |
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Power |
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Electricity charges ( Factory ) |
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Loading & Unloading Exp |
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Ware House Expense |
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Custom clearing charges |
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Carriage |
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Freight Charges |
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Coal & Fuel |
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Gas chares ( Factory ) |
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Water Charges ( Factory ) |
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Export Duty |
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Delivery charges ( Buying raw material) |
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Diesel Expense ( Factory ) |
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Fixed Asset |
Land A/c |
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Building |
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Plant & Machinery |
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Motor Vehicles |
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Furniture & Fixtures |
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Computer & Peripherals |
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Computer software |
Most Expensive software if purchased |
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Long Term Investment |
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Indirect Expense |
Interest On Capital |
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Salary Account |
Vary in relation to the nature of business, Some time salary account termed as direct expense. |
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Directors Remuneration |
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Partners salary |
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Professional Fees |
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Legal charges |
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Interest on loan |
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Depreciation |
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Amortization |
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Audit Fee |
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Insurance |
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Local Conveyance |
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Miscellaneous Expense |
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Rates & Taxes |
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Round off |
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Printing & Stationery |
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Travelling Expense |
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Vehicle Expense |
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Telephone Charges |
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Communication Expense |
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Advertising charges |
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Discount Allowed |
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Staff Welfare Expense |
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Compound Tax Paid |
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Courier Charges |
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Commission Paid |
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Interest on Income Tax |
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Tea & Coffee Expense |
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Bank Charges |
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Rent Expense ( Office ) |
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Maintenance Expense ( Office , Building ) |
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Sample Free |
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Interest on VAT |
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Interest on TDS |
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Interest on TCS |
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Donation & Charity |
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Penalty |
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Loss by fire |
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Loss By theft |
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Legal Charges |
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Bad Debts |
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Diesel/Petrol Expense |
For travelling, cars for managers etc |
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Freight Received |
To account the freight charges received from customers. Eg: Transportation using Lorry |
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Scrap Sale |
sale of small amount carton box, machinery damaged parts etc. |
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Commission Received |
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Interest Received |
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Interest On Investment Received |
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Indirect Income |
Freight Received |
To account the freight charges received from customers. Eg: Transportation using Lorry |
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Commission Received |
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Interest Received |
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Interest On Investment Received |
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Discount Received |
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Bad Debt Recovered |
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Investments |
Investment in Share |
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Loans ( Liability) |
Loan Account |
For Eg: ICICI Bank Loan a/c |
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Bank OD A/c ( Bank OCC A/c ) |
Bank OD /CC Accounts |
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Secured Loans |
Car loan |
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Housing Loan A/c |
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Mortgage Loan |
Assets are pledged against loans |
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Secured Credit card A/c |
credit cards issued against fixed deposit |
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Unsecured Loans |
Students loan |
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Credit Cards |
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Personal Loans |
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Miscellaneous Expense ( Asset) |
Pre- operative expense |
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Purchase Account |
All Purchase ledger created |
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Sales Account |
Sale Ledger |
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Suspense A/c |
Suspense A/c |
Any unknown payment received, any difference in cash balance could not figured out. Can put the balance under suspense until it is figured out. |
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Profit & Loss A/c |
Profit & loss account |
created automatically |