Tally Prime Secrets: Simplify Job Work and Maximize Job Costing Efficiency

Published on: 09-05-2025

Tally Prime Secrets: Simplify Job Work and Maximize Job Costing Efficiency

Tally Prime, the latest version of Tally accounting software, offers robust features for businesses engaged in manufacturing, processing, or project-based operations. Two important features in Tally Prime are Job Work and Job Costing, which allow businesses to manage outsourced production and track job-wise profitability efficiently.

1. Understanding Job Work in Tally Prime

Job Work refers to processing or manufacturing activity performed by one party (the job worker) on goods supplied by another party (the principal manufacturer). It is common in industries like garments, metalworks, packaging, food processing, and more.

In Tally Prime, Job Work is divided into two parts:

• Job Work In: When you receive materials from your customer for processing.
• Job Work Out: When you send materials to a job worker for processing.

Using Tally Prime, companies can manage both scenarios seamlessly by recording material movements, processing charges, and finished goods delivery with proper tracking.

2. Enabling Job Work in Tally Prime

Before starting job work transactions, it is necessary to activate relevant features:

• Go to Gateway of Tally → F11 (Features) → Inventory Features.
• Set the following options to Yes:
  • Enable Job Order Processing.
  • Maintain Multiple Godowns (to track stock location).
  • Use Cost Centres for Job Costing (optional but useful for cost tracking).

Once enabled, Tally Prime introduces new voucher types like Job Work In Order, Job Work Out Order, Receipt Note, Delivery Note, and Stock Journal with job work details.

3. Configuring Ledgers and Items for Job Work

After enabling the feature, set up the necessary masters:

a) Ledger Creation:

• Create Customer and Supplier Ledgers under Sundry Debtors or Sundry Creditors.
• While creating the ledger, enable:
  • "Is a Job Worker" (Yes) for job workers.
  • "Maintain Balances Bill-by-Bill" for tracking outstanding orders and charges.

b) Stock Items:

• Create stock items like Raw Material, Semi-finished Goods, Finished Goods.
• For complex production, create Bill of Materials (BOM) to define the quantity of raw materials required for producing finished goods.

c) Godown/Location:

• Create separate godowns like "At Job Worker Location", "Finished Goods", "Raw Material Stock" to track physical movement of goods.

4. Job Work Process in Tally Prime

Depending on whether you are giving job work (Job Work Out) or receiving job work (Job Work In), the flow differs slightly.

A) Job Work Out Process (Sending Materials for Job Work)

1. Create a Job Work Out Order:
   • Go to Inventory Vouchers → Job Work Out Order.
   • Enter party name (Job Worker).
   • Specify stock items, quantity, and expected delivery date.
2. Delivery Note (Sending Material):
   • Go to Inventory Vouchers → Delivery Note.
   • Select the Job Work Out Order.
   • Dispatch raw materials to the job worker.
   • Mention "Material Sent for Processing" under supplementary details.
3. Receipt Note (Receiving Processed Goods):
   • Go to Inventory Vouchers → Receipt Note.
   • Select the Job Work Out Order.
   • Update the receipt of finished goods.
   • You can use the Bill of Materials to automatically consume raw materials and generate finished goods.
4. Accounting for Job Work Charges:
   • Record a Purchase Voucher for the invoice received from the job worker for processing charges.

B) Job Work in Process (Receiving Materials for Processing)

1. Create a Job Work in Order:
   • Go to Inventory Vouchers → Job Work in Order.
   • Select the customer (Principal).
   • Mention raw materials received, expected processing, and finished goods to deliver.
2. Receipt Note (Receiving Material):
   • Go to Inventory Vouchers → Receipt Note.
   • Link with Job Work In Order.
   • Record the receipt of raw materials.
3. Delivery Note (Sending Back Finished Goods):
   • Go to Inventory Vouchers → Delivery Note.
   • Link it with the Job Work In Order.
   • Mention finished goods produced and delivered back.
4. Raising an Invoice for Job Work Charges:
   • Create a Sales Voucher.
   • Charge for your processing or labour services based on the agreement.

5. Understanding Job Costing in Tally Prime

Job Costing is the process of accumulating and analysing costs associated with specific jobs, contracts, or projects. In Tally Prime, Job Costing is done using Cost Centres and Cost Categories.

This is especially important for companies involved in construction, consulting, custom manufacturing, and repair services.

Steps to Set Up Job Costing

1. Enable Cost Centre and Cost Category:
   • Gateway of Tally → F11 (Features) → Accounting Features.
   • Enable "Maintain Cost Centres" and "Use Cost Categories".
2. Create Cost Centres:
   • Gateway of Tally → Create → Cost Centres.
   • Example: Create a cost centre for each project, like "Project Alpha", "Order #1001", "Contractor XYZ".
3. Assign Costs and Income:
   • While booking entries (Purchase, Sales, Payment, Receipt), Tally asks for Cost Centre Allocation.
   • Assign the expenses (materials, labour, overheads) and incomes to the correct Job/Cost Centre.
4. Reports:
   • Gateway of Tally → Display More Reports → Cost Centres.
   • View Job Profitability Reports, Ledger Break-up Reports, and compare Cost vs Income for each project.

6. Job Work and Job Costing Reports

Tally Prime offers specialized reports to track job orders, material movement, and job profitability.

• Job Work Analysis:
  • Track outstanding job work orders.
  • Monitor materials sent/received for processing.
  • Identify delays in production.
• Job Costing Report:
  • View project-wise expenses.
  • Analyse profitability per job.
• Stock Movement Reports:
  • Trace raw material consumption and finished goods generation.

These reports help in managing operations efficiently and help decision-makers assess job performance.

7. Benefits of Using Job Work and Job Costing in Tally Prime

• Efficiency in Material Tracking: Avoids confusion about goods in transit and at different locations.
• Better Control on Production Process: Helps in understanding production stages and job worker performance.
• Accurate Billing and Invoicing: Ensures processing charges are recorded and billed properly.
• Project Profitability Tracking: Gives a clear picture of income vs expenses per project/job.
• Regulatory Compliance: Helps in complying with GST and statutory requirements related to job work.

Conclusion

Job Work and Job Costing are essential modules for any manufacturing, service, or processing-oriented business. Tally Prime provides a simple yet powerful system to handle these complex operations efficiently. By enabling Job Order Processing and Cost Centres, businesses can systematically manage material movements, allocate costs, track outstanding orders, and assess profitability.

Proper setup, correct recording of transactions, and regular monitoring of reports ensure that the business remains competitive and profitable in today's dynamic market environment.

With Tally Prime, what used to require multiple spreadsheets and manual tracking is now integrated into a single, user-friendly system — providing both operational control and financial insight.