In TallyERP9 you can allocate transactions (especially those which are revenue in nature) to particular Cost Center, which

will help to extract reports for that cost center.

Cost Center is generally an Unit / Division / Department / Function / activity etc. in the organization or sales executives, to which transactions are allocated.

We can also compare one cost center with another. Cost Center will provide the management with information regarding their performance.

Cost Categories
With Cost Categories, parallel allocations of the same expense is possible between different cost centers.

It is used to track the revenue based on location or person or brand or type of the product.
using Cost Categories, we can enable costs to parallel sets of cost centers i.e. same amount can be allocated to more than one cost center.


1.

Ex.
Create following Cost Centers Ajay Vijay Sujay

set Maintain Cost Centres to Yes in F11: Accounting Features. For parallel allocation of Cost, you can set More than ONE Payroll/Cost Category to Yes.

By default, Tally.ERP 9 activates the Cost Centre feature for Ledger accounts under Sales Accounts, Purchase Accounts, Expense and Income groups.

Go to Gateway of Tally> Accounts Info.> Cost Centres> Create (Single Cost Centre)

3. Create Ledgers i.e. Salary Expenses, Sales, Purchase, Travelling Exp., Commission Exp.

Set Maintain Cost Centres to Yes in F11: Accounting Features and then set More than ONE Payroll/Cost Category to Yes. Tally.ERP 9 creates a single Cost Category called Primary Cost Category automatically and allows creation of Cost Centres under the Primary Cost Category.
However, you may also create new Cost Categories or alter existing Cost Categories.

Go to Gateway of Tally > Accounts Info. > Cost Categories > Create (under Single Cost Category)

Allocate Revenue Items

Set this option to Yes, to allocate all sales,

purchase, expenses and income related transactions to Cost Centres created under this Cost Category.

Allocate Non-Revenue Items

Set this option to Yes, to allocate transactions

related to capital or non-revenue nature to Cost Centres created under this Cost Category