📦 Module C – Inventory (Days 15–18) · Day 16

Day 16: Item Invoice – Purchase & Sales with Stock

⏱ 80 min📶 Intermediate🎯 100% self-study

Day 16 / 30

✅ Today you will learn

Enter a purchase invoice item-wise (F9)
Enter a sales invoice with a discount column (F8)
Allocate items to godowns
Record item-wise purchase returns (Debit Note)
Understand what each invoice does to accounts and stock

🏢 In the real world

A customer asks Rohit for a printed bill showing every item, quantity and rate. At the same time, the stock of A4 paper must go down by exactly the reams sold. One item invoice in TallyPrime does both – it updates the accounts and the stock in a single entry.

Item invoice vs accounting invoice

Item invoice

Lists stock items, qty, rate
Updates stock and accounts together
Used for trading goods

Accounting invoice

Only ledgers and amounts
No effect on stock
Used for services or when inventory is off

Ctrl+H in a Sales/Purchase voucher switches between the two

Purchase invoice (F9)

1Gateway → Vouchers → F9 (Purchase). Check the title says Item Invoice (Ctrl+H if not).
2Supplier Invoice No. SAI/112 and date 02-05-2026.
3Party A/c name: Sai Traders. Purchase ledger: Purchases.
4Select each stock item → godown → quantity → rate. Amount = qty × rate.
5Narration and Ctrl+A.

Purchase – Sai Traders, invoice SAI/112, 02-05-2026
Item	Qty	Rate (₹)	Disc %	Amount (₹)
A4 Copier Paper 75 GSM	200 Ream	260		52,000
Ball Pen Blue	50 Box	80		4,000
Geometry Box	40 Nos	60		2,400
Total				58,400

Purchase Voucher F9No. 1 · Date 02-05-2026

	Particulars	Debit	Credit
Dr	Purchases 3 items, stock increases	58,400
Cr	Sai Traders		58,400
	Total	58,400	58,400

Narration: Accounting effect of the item invoice above

Sales invoice with a discount column (F8)

To show a discount per item, press F12 in the sales invoice and turn on the option to provide a separate discount column. TallyPrime then calculates amount = qty × rate – discount %.

Sales invoice no. 1 – Gupta School, 06-05-2026
Item	Qty	Rate (₹)	Disc %	Amount (₹)
A4 Copier Paper 75 GSM	150 Ream	300		45,000
Notebook 200 Pages	120 Nos	35	5	3,990
Ball Pen Blue	20 Box	110		2,200
Total				51,190

Notebooks: 120 × ₹35 = ₹4,200, less 5% (₹210) = ₹3,990. This is a trade discount – it is shown on the invoice and is never posted to the Discount Allowed ledger.

Sales Voucher F8No. 1 · Date 06-05-2026

	Particulars	Debit	Credit
Dr	Gupta School	51,190
Cr	Sales 3 items, stock decreases		51,190
	Total	51,190	51,190

Narration: Credit sale – Gupta School

Cash sale no. 2, 22-05-2026 (Party A/c: Cash)
Item	Qty	Rate (₹)	Disc %	Amount (₹)
A4 Copier Paper 75 GSM	120 Ream	310		37,200
Geometry Box	25 Nos	90		2,250
Ball Pen Blue	15 Box	110		1,650
Total				41,100

💼 Office practice – professional tipFor counter (walk-in) sales choose Cash as the Party A/c – never create a ledger for each walk-in customer. Do record the customer’s name and mobile in the buyer details if they want a bill; it helps with returns.

Item-wise returns

On 08-05-2026 Rohit returned 5 damaged geometry boxes to Sai Traders. Use Alt+F5 (Debit Note) in item-invoice mode, link it to the original purchase invoice SAI/112 and enter the item:

Debit Note no. 1 – Sai Traders, 08-05-2026
Item	Qty	Rate (₹)	Disc %	Amount (₹)
Geometry Box	5 Nos	60		300
Total				300

Debit Note Voucher Alt+F5No. 1 · Date 08-05-2026

	Particulars	Debit	Credit
Dr	Sai Traders	300
Cr	Purchase Returns Stock of Geometry Box reduces by 5		300
	Total	300	300

Narration: Goods returned against invoice SAI/112

ℹ️ Sales returns

A customer’s return works the same way with Alt+F6 (Credit Note): Sales Returns Dr, customer Cr, and the stock comes back in.

Solved examples

Example 1: Second purchase and its effect

Purchase – Sai Traders, invoice SAI/131, 15-05-2026
Item	Qty	Rate (₹)	Disc %	Amount (₹)
A4 Copier Paper 75 GSM	100 Ream	270		27,000
Total				27,000

Sai Traders’ account (Cr) after the May entries: ₹58,400 + ₹27,000 – ₹300 (debit note) = ₹85,100 payable.

Practice exercises (unsolved – answer hidden)

Try each exercise on paper or in TallyPrime first, then open the answer to check.

🏋️ Practice – do it yourself

Task 1: Prepare sales invoice no. 3 dated 28-05-2026 for Mehta Book Depot (credit): A4 Copier Paper 40 reams @ ₹305; Geometry Box 10 @ ₹95 with 10% discount; Ball Pen Blue 5 boxes @ ₹115. What is the invoice total and the journal effect?

Show solution

A4 Copier Paper 75 GSM 40 × ₹305 = ₹12,200; Geometry Box 10 × ₹95 less 10% = ₹855; Ball Pen Blue 5 × ₹115 = ₹575. Total ₹13,630. Mehta Book Depot Dr ₹13,630 / Sales Cr ₹13,630; stock of the three items reduces.

Task 2: Why should a 5% trade discount on an invoice not be posted to the Discount Allowed ledger, while a 2% discount for early payment should?

Show solution

Trade discount reduces the selling price itself – the sale is recorded net. Cash discount is given later for prompt payment, after the sale, so it is a separate expense (Discount Allowed).

🏅 Job skills unlocked today

✔ Enter item-wise purchases and sales✔ Use discount columns correctly✔ Allocate godowns✔ Record item-wise returns

Quick quiz

🧠 Quick Quiz – test yourself

1. An item invoice updates:

That is its main advantage.

2. 120 notebooks @ ₹35 less 5% =

4,200 – 210.

3. Purchase return with items uses:

Alt+F5 Debit Note.

4. To switch between item and accounting invoice press:

Ctrl+H = change mode.

Interview corner

💼 Interview Corner

How do you show a discount for each item on a sales invoice?

Enable a separate discount column with F12 in the sales voucher; enter the discount % per item and TallyPrime computes the net amount. It is a trade discount, so no separate ledger entry.

How do you record a cash sale to a walk-in customer?

Sales voucher (F8) with Party A/c = Cash; optionally enter buyer name and mobile in the party details.

Summary

Item invoice = stock + accounts in one voucher.
Trade discount stays on the invoice; cash discount goes to a ledger.
Purchase return Alt+F5, sales return Alt+F6 with items.
Walk-in sales use Cash as the party.

➡️ Next

Day 17: order processing – purchase/sales orders, receipt and delivery notes, and pending orders.

Frequently Asked Questions

Can I change the rate of an item on an invoice?

Yes, the rate is typed on each invoice. You can also set a selling price list (price levels) so the rate fills in automatically.

What if I sell more than the stock available?

TallyPrime warns about negative stock. Check whether a purchase is still to be entered; negative stock usually means a missing or late purchase entry.

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Tally and TallyPrime are trademarks of Tally Solutions Pvt. Ltd. This is an independent course, not affiliated with or endorsed by Tally Solutions. All business names, GSTINs and figures in the examples are fictional samples.