FrontAccounting/C2/Banking-and-General-Ledger/English

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Title of the Script : Banking and General Ledger in FrontAccounting

Author: Sheetal Prabhu

Keywords: GL Classes, Groups, Accounts, Journal Entry, Balance sheet, void a transaction

Visual Cue
Narration
Slide Number 1

Title Slide

Welcome to this tutorial on, Banking and General Ledger in Front Accounting
Slide Number 2a

Learning Objectives

In this tutorial,we will learn to create

  • General Ledger Classes
  • General Ledger Groups
  • General Ledger Accounts
In this tutorial,we will learn to create
  • General Ledger Classes
  • General Ledger Groups
  • General Ledger Accounts
Slide Number 2b

Learning Objectives

Also, we will learn to :

  • Pass a Journal Entry
  • See the reflection in Balance sheet
  • Void a transaction
Also, we will learn to :
  • Pass a Journal Entry
  • See the reflection in Balance sheet and
  • How to void a transaction
Slide Number 3

System Requirements

  • Ubuntu Linux OS version 14.04
  • FrontAccounting version 2.3.24
To record this tutorial, I am using
  • Ubuntu Linux OS version 14.04
  • FrontAccounting version 2.3.24
Slide Number 4

Pre -requisites

To practise this tutorial, you must be familiar with:

  • Principles of Book-keeping
  • Set up an Organisation/Company in FrontAccounting

If not, for relevant FrontAccounting tutorials please visit http://spoken-tutorial.org

To practise this tutorial, you must be familiar with:
  • Principles of Book-keeping
  • Set-up of an Organisation/Company in FrontAccounting

If not, for relevant FrontAccounting tutorials please visit our website.

Narration Let us start by opening the FrontAccounting interface.
Click on browser >>localhost/account >> Press Enter Click on the browser, type localhost/account and press Enter.
Narration The login page appears.

Recall that during installation, we had created admin user.

Enter Username = admin and Password = spoken>> Click on login So, here type the username as admin and the password.

Then click on Login button.

Point to>> Frontaccounting >> page

Click>> Banking and Ledger>> tab

The FrontAccounting window opens.

Click on Banking and General Ledger tab.

Point to options of Banking and General Ledger We can see various options under this tab, such as:
  • Payments
  • Deposits
  • Journal Entry etc.
Narration Before we start with any transaction, we need to set the Charts of Accounts.
Slide 5

Charts of Accounts

* The Charts of Accounts within FrontAccounting is defined by Type, Class, Group and Account.
  • All transactions are charged to an Account, Group, Classes
  • These are used to group transactions for reporting purposes.
Narration Switch back to FrontAccounting interface.
Point to>> Maintenance bar>>
  • GL Accounts
  • GL Account Groups
  • GL Account Classes
We can see the options under Maintenance bar as:
  • GL Accounts
  • GL Account Groups
  • GL Account Classes

in this tab.

Point to the >> Gl Account, Gl Groups and GL Account Classes>> We need to set these options.
Slide 6

Why GL Accounts, Groups and Class?

  • Account belongs to a Group and
  • Group belongs to Class
  • It depends upon how to present the Balance Sheet and Profit and Loss A/c statements
In FrontAccounting,
  • Account belongs to a Group and
  • Group belongs to Class
  • It depends upon how to present the Balance Sheet and Profit and Loss A/c statements
Point to>> GL Account Classes>> Here, GL Accounts Classes are the initial stage that need to be set first.
Click>> GL Accounts Classes>> Let us see the GL Accounts Classes.
Click>> GL Account Classes >>

Point to the Class ID and the Class type

Here, by default the Class Type and Class Name

have been defined as:

  1. Assets
  2. Liabilities
  3. Income
  4. Expense

Also, you can see the Class ID is set for each Class Type.

Narration You will need to set this class before setting the Account Groups.


I will demonstrate how to do this.

Click >>Class ID field >>

Type 5

Here, you need to add a new Class ID that is not already there.

So, I will type 5 as the new Class ID.

Click>> Class Name field>> In the Class Name field, type a new Class Name. I will type the name as Equity.
Click>> Class Type field >>

Show the dropdown box and the options

Narration

Click on the Class Type drop down box.

You can see the default list:

  • Assets
  • Liabilities
  • Equity
  • Income
  • Cost of Goods Sold
  • Expense

FrontAccounting follows this Class Type to present in the Balance Sheet.

Select the Class type as Equity Select the Class Type as Equity.
Click>> Add new button>>

Point to the message which appears

Click on Add new button.

We can see a message appears and it says-

'New account class has been added'

Point to the Equity status >> GL Account Classes

Point >> Class type drop down box>>

Point >> the Panel where the Equity shows in the third level>>

Here, you can see the new Class “Equity” has been added to the third row.


This is because, in the default Class Type, Equity is on the third hierarchy level.


So, whenever you add a new Class, it takes the default place of the Class Type.

Point to Banking and General Ledger tab Now, let us see how to add GL Groups.

Go to the Banking and General Ledger tab.

Click>> GL Groups >> Click on the GL Account Groups.
Point to the >> GL Group Name List >>


Point to the >>Group ID list>>

We can see the default Group Name, which shows GL Account Groups under the Class.

You can also see the Group ID, set according to the Class.

Narration A unique Class ID has to be added to each Group Name.
Point to the >>Group ID list>> In the Group ID field, I will type the new Group ID as 12.
Click>> Group Name field>> In the Name field, I will type Fixed Assets as the Group Name.
Click>> Subgroup of dropdown menu>>


Point>> Subgroup of field>>

Here, I will keep this field as None.


This is because, the Group Name “Fixed Assets” does not belong to any subgroup that is already available.

Click>> Class dropdown box >> select Assets


Click on the Class drop down box.

According to the Charts of Accounts, Fixed Assets comes under the class of Assets.

Here, I will select Assets as the Class.

Click>> Add New button >>


Point to the message which appears

To save these changes, click on Add new button.

We can see an error message that says -

“This account Group ID is already in use”.

Point to the existing code 12


Narration

This means that the Account Group ID 12 is repeated.


Now, let us enter another number which is unique.

Type>> Group ID 13>>


Click>> Add New button>>

Let me type the Group ID as 13.


Click on Add new button.

Point to the>> message bar>> This time we can see a message that says -

“New account type has been added.”

Point to the newly added Group Name The new Group Name is added randomly within the class “Assets”.
Narration Likewise, you can add your own Group Name.

<<PAUSE>>

Point to Banking and General Ledger tab


Now, let us see how to add GL Accounts.


Click on the Banking and General Ledger tab.

Click>>GL Accounts >> Let us click on GL Accounts.
Click>> Account Code field>>


Point to the Account Code field

Here also, you need to type a unique code.


In the Account Code field, I will type 1100 as the code.

Click>> Account Name field>> Click on the Account Name field.

I will type the Account Name as “Land and Building”.

You can give any name of your choice.

Click >> Account Group field>>

Select the Fixed Assets Account Group>>

Narration

In the Account Group drop down box, I will select the Account Group as Fixed Assets.

The Account Name, Land & Building has to come under the Group Fixed Assets as per the Charts of Accounts.

Click>> Account status field >> So here, click on the Account status drop down menu.

Select the status as Active.

Click>> Add Account button >>

Narration

Then click on Add Account button.

We can see the message -

‘New account has been added’.

Click>>account drop down box>>

Narration

Now, click on the New account dropdown box.

You can see the newly added Account here.

Point to the account code Each organisation will have their own set of account codes, as shown here.
Narration Likewise, by following the steps demonstrated above, you can create your own GL Account.
Narration Pause the tutorial here.
Slide 7:

Assignment 1

  • Create a GLAccount Group as Investment
  • Create GLAccount as Bonds, Debentures
  • Save the changes
And do this assignment.
  • Create a GL Account Group as Investment
  • Create 2 separate GL Accounts named Bonds and Debentures
  • Save the changes
Narration Now, we have set up the Charts of Accounts for our own Company.
Slide -8

Commenced business with a Capital Rs 50,000

The Entry is

Cash A/c Dr. 50,000

To Capital A/c 50,000

(Being Capital introduced in business)

Next, let us pass a Journal Entry.

Commenced business with a capital of Rs. 50,000

The Entry is

Cash A/c Dr. 50,000

To Capital A/c 50,000

(Being Capital introduced in the business)

Point to Banking and General Ledger tab Click on the Banking and General Ledger tab.
Click>> Journal Entry option >> And then click on Journal Entry.
Point>> Date field>>

Point to the current date

Next, click on the Calendar icon of Date field.


You can see that the default date is set as today.

Point to Reference field We can see the reference number for the transaction here.
Click>>Account Description drop down box>>

Select the Account Description >>

Click on the Account Description drop down box.

Here, I will select the option Cash.

Click>> Debit textbox>> Then, click on the Debit text box and type the amount as 50,000.
Click on the Add Item button To save the Debit entry, click on the Add Item button.
Point to the Account Description box >>

Select Capital

Again, click on the Account Description drop down box.

This time, I will select the option Capital.

Click>> Credit textbox>> Then, click on the Credit textbox and type the amount as 50,000.
Click on the Add Item button>> To save the Credit entry, click on the Add item button.
Click>> Memo field>> Now, click on the Memo field, for the narration of this Journal Entry.
Point to the Memo field >> Here, type the text - Being capital introduced in the business.
Click>> Process Journal Entry button>> Then click on the Process Journal Entry button to save the entry.
Point to the green colour message bar>> You can see the message at the top, that appears in green -

“Journal Entry has been entered # 2”

Point to the options >> You can also see the options:
  • View this Journal Entry
  • Enter New Journal Entry
  • Add an Attachment and
  • Back
Click>>View this Journal Entry

Narration

Let us explore View this Journal Entry option by clicking on it.

Immediately, a new popup window opens showing the current General Ledger Transaction details.

Point to Print and Close option

Narration

We can also see an option here - Print and Close.

By choosing this option, we get a print-out of this transaction for our future reference.

Point to Close option This option here, at the bottom right is to close this window.

I will choose this and close this window.

Click>>Enter New Journal Entry

New window opens for the Journal Entry

Now, click on the Enter New Journal Entry option.

We can see a new page opens immediately for the next new transaction.

Click>> Back option>> Click on the Back option to go back.
Click>>Add an Attachment Now, click on the Add an Attachment option.
Point to the menu bar>> Attachment We can see the fields:
  • Transaction
  • Description and
  • Attached file

Attached file option is used to attach any documents related to the Journal entry which is passed.

Narration Let me attach a sample voucher which I have already created and stored on my computer.

For your convenience, this file has been provided in the Code file link below this video.

Pls click on the link and save the file on your computer.

Click on the Attached file text box Click on the Browse button and locate the folder in which the document is stored.
Point to the Sample-Voucher file I'll select the Sample-Voucher.odt file from my Desktop folder.
Point to the Browse text box and the file attachment You can see the file attachment here now.
Show the message which appears in green

Point to the message bar

Then click on the Add new button.

A message appears that says:

Attachment has been inserted.

Narration Also, you can see that the uploaded file has been added to the table.

<<PAUSE>>

Narration Now, let us see the reflection of this Journal Entry in the Balance Sheet.
Point to Banking and General Ledger tab To do so, click on the Banking and General Ledger tab.
Click>> Balance sheet Drilldown >> Then click on the Balance Sheet Drilldown option.
Point to Current Assets We can see the transaction is reflected here.

Current Assets shows balance of 50,000 (fifty thousand).

Point to Liabilities The transaction is also reflected in Liabilities by showing the balance of 50000 (fifty thousand).
Point to the Assets and Liabilities

Narration

Since we made only one Journal Entry, we see only one entry in the displayed list.


In the future, when we have many more journal entries, the displayed list would be longer.

<<PAUSE>>

Narration Let us now see how to Void a transaction.
Click>> Setup tab>>

Click>> Void a transaction>>

Click on the Setup tab, and then on the option Void a transaction under the Maintenance bar.
Narration

Point to the reference number field>>

This option is used to delete/remove an entry.

We can see the reference number, which shows the entry.

Point to the select icon Click on the Select icon.
Point to the entry shown in the field On selecting the icon, the transaction number and voiding date appears.
Click >> Void Transaction button>> Click on the Void Transaction button.
Point to message bar A message appears that says-

Are you sure you want to void this transaction? This action cannot be undone.

Click>> Proceed button>> I’ll click on the Proceed button.

Immediately another message appears and says-

Selected transaction has been voided.

That’s how we void a transaction, whenever required.

Narration Let us summarize.
Slide 9 a

Summary

In this tutorial, we have learnt to create

  • General Ledger Classes
  • General Ledger Groups
  • General Ledger Accounts
In this tutorial, we have learnt to create
  • General Ledger Classes
  • General Ledger Groups
  • General Ledger Accounts
Slide 9 b

Summary

Also, we have learnt to :

  • Pass a Journal Entry
  • See the reflection in Balance sheet
  • Void a transaction
Also, we have learnt to :
  • Pass a Journal Entry
  • See the reflection in Balance sheet and
  • How to void a transaction
Slide 10

Assignment 2

  • Pass a Journal Entry
    Goods Purchased for Rs 50,000
  • See the reflection in Balance Sheet
As an Assignment
  • Pass a Journal Entry
    Goods Purchased for Rs 50,000
  • See the reflection in the Balance Sheet
Slide Number 11

Acknowledgement

This video summarizes the Spoken Tutorial project

If you do not have good bandwidth, you can download and watch it.

Acknowledgement

This video summarizes the Spoken Tutorial project.

Please download and watch it.

Slide 12 We conduct workshops using Spoken Tutorials and give Certificates.

For more information, please contact us.

Slide 13 The Spoken Tutorial Project is funded by NMEICT, MHRD Government of India.

This tutorial has been contributed by Sheetal Prabhu from IIT Bombay.

Thank you for joining.

Contributors and Content Editors

Nancyvarkey, Nirmala Venkat, Sheetal