Purchase/Sales Order & Reorder Levels

Learning Objectives

Is class ke end tak student:

• Order Processing ka core workflow samjhega.
• Purchase Order (PO) create kar payega.
• Sales Order (SO) create kar payega.
• Pending Order quantity aur value track kar payega.
• Order fulfilment aur pending order status mein difference samjhega.
• Order Pre-Closure ka practical purpose aur application samjhega.
• Purchase Order aur Sales Order ko pre-close kar payega.
• Order Normal Closure aur Pre-Closure ka difference identify karega.
• Reorder Level aur Minimum Level ka fundamental difference samjhega.
• Minimum Order Quantity (MOQ) ka role samjhega.
• Closing Stock aur Pending POs ko evaluate karke actual shortfall calculate karega.
• Inventory reports se order tracking aur status verify karega.

Order Processing Workflow & Core Concepts

Real-world business operations mein transactions direct billing se pehle formal orders ke through execute hote hain:

Standard Inventory Document Progression

• Purchase Side: Purchase Requirement → Purchase Order (PO) → Receipt Note (Goods Receipt) → Purchase Invoice
• Sales Side: Customer Requirement → Sales Order (SO) → Delivery Note (Dispatch) → Sales Invoice

Day 1 Scope: Focus will be strictly on Purchase Orders, Sales Orders, Pending Tracking, Pre-Closure, and Reorder Levels. Physical goods movement vouchers (Receipt Note / Delivery Note) will be practiced in detail in Day 3.

Order vs Invoice Comparison Matrix

Golden Rule:
Order = Future mein kya purchase ya sell karne ka agreement hai.
Invoice = Actually kitna purchase ya sale complete ho chuka hai.

Company Setup & Feature Activation

Company Profile

• Company Name: ABC Traders | State: Maharashtra | FY: 2026–27 | Books Beginning: 01-Apr-2026

Enabling Order Processing in TallyPrime:

1. Press F11 (Features) on the Gateway of Tally.
2. Set Maintain Inventory to Yes.
3. Set Integrate Accounts with Inventory to Yes.
4. Option ko Yes karein: Enable Purchase Order Processing to Yes.
5. Option ko Yes karein: Enable Sales Order Processing to Yes.
6. Poori screen accept karne ke liye press karein Ctrl + A (Save) settings.

Masters Configuration

1. Unit of Measurement

• Symbol: Nos | Formal Name: Numbers | Decimal Places: 0

2. Stock Items Setup

3. Supplier & Customer Ledgers

• Suppliers (Sundry Creditors): Tech Distributors (Maharashtra), Delhi IT Solutions (Delhi), Maharashtra Computer House (Maharashtra).
• Customers (Sundry Debtors): Mumbai Office Solutions (Maharashtra), Pune Retail (Maharashtra), Delhi Corporate (Delhi).

Part A — Purchase Order Processing

Practical 1: Raising Purchase Order (PO-001)

05-Apr-2026: Placed formal order to Tech Distributors for restocking.

• Laptop: 20 Nos @ ₹40,000 = ₹8,00,000
• Printer: 50 Nos @ ₹8,000 = ₹4,00,000 | Total Order Value = ₹12,00,000
• TallyPrime Steps: Go to Vouchers → Select Purchase Order (Alt + F4 / Ctrl + F4) → Party: Tech Distributors → Order No: PO-001 → Allocate items and save with Ctrl + A.

Practical 2: Raising Second Purchase Order (PO-002)

08-Apr-2026: Placed order to Maharashtra Computer House (Order No: PO-002).

• Monitor: 20 Nos @ ₹10,000 = ₹2,00,000
• Keyboard: 100 Nos @ ₹800 = ₹80,000 | Total Order Value = ₹2,80,000

Total Pending Purchase Orders Summary:

Part B — Sales Order Processing

Practical 3: Recording Sales Order (SO-001)

01-Apr-2026: Received sales order from Mumbai Office Solutions (Order No: SO-001).

• Laptop: 10 Nos @ ₹50,000 = ₹5,00,000
• Printer: 20 Nos @ ₹12,000 = ₹2,40,000 | Total Order Value = ₹7,40,000
• TallyPrime Steps: Go to Vouchers → Select Sales Order (Alt + F5 / Ctrl + F5) → Party: Mumbai Office Solutions → Order No: SO-001 → Enter items and save with Ctrl + A.

Practical 4: Recording Second Sales Order (SO-002)

01-Apr-2026: Received order from Pune Retail (Order No: SO-002): Monitor (15 Nos) + Keyboard (80 Nos).

Part C — Order Pre-Closure Mechanics

Jab customer bachi hui balance quantity cancel kar deta hai ya supplier remaining goods supply karne se mana kar deta hai, tab pending quantity ko permanently close karne ke liye Pre-Closure ka use kiya jata hai.

Normal Closure vs Pre-Closure

• Normal Fulfilment Closure: Ordered (50) = Fulfilled (50) → Pending becomes 0 automatically.
• Pre-Closure: Ordered (50) → Fulfilled (30) → Customer cancels 20 → Pre-Close (20) → Pending becomes 0.

Important Rule:
Pre-Closure sirf future unfulfilled commitments ko cancel karta hai; yeh already delivered/billed goods ko alter ya reverse nahi karta.

Practical 5 & 6: Pre-Closure Execution Breakdown

Part D — Reorder Levels & MOQ Calculation

Reorder Level: Predefined stock threshold jo business ko alert karta hai ki fresh purchase orders place karne ka time aa gaya hai.

Minimum Order Quantity (MOQ): Vendor dwara specified minimum bulk batch size jo ek single purchase order mein order karna mandatory hota hai.

Reorder Level Determination Formula:
Reorder Level = (Daily Consumption Rate × Supplier Lead Time in Days) + Safety Stock

Example for Printer: (3 Nos/day × 10 Days Lead Time) + 5 Nos Safety Stock = 35 Nos Reorder Level.

Net Available Stock & Shortfall Formula:
Net Available Stock = Closing Stock + Pending Purchase Orders − Sales Orders Due
Shortfall = Reorder Level − Net Available Stock
Order to be Placed = Higher of (Shortfall OR Minimum Order Quantity)

Stock Replenishment & Decision Analysis Matrix

Complete Practice Set

Master Stock Configuration Schedule:

Practice Orders to Record:

• PO-001 (Tech Distributors): 20 Laptops + 50 Printers.
• PO-002 (Maharashtra Computer House): 30 Monitors + 100 Keyboards.
• PO-003 (Delhi IT Solutions): 15 Laptops + 100 Mouse.
• SO-001 (Mumbai Office Solutions): 10 Laptops + 20 Printers.
• SO-002 (Pune Retail): 15 Monitors + 80 Keyboards.
• SO-003 (Delhi Corporate): 8 Laptops + 50 Mouse.

Pre-Closure & Analysis Tasks:

1. On SO-001, fulfill 10 Laptops & 12 Printers → Pre-close remaining 8 Printers.
2. On PO-002, receive 20 Monitors & 100 Keyboards → Pre-close remaining 10 Monitors.
3. Evaluate Printer stock (Current Stock: 25, Reorder Level: 30, Pending PO: 0) → Calculate new order requirement.
4. Evaluate Monitor stock (Current Stock: 8, Reorder Level: 10, Pending PO: 10) → Confirm no extra PO needed due to expected pipeline.

Verification Reports, Common Mistakes & FAQs

Verification Reports in TallyPrime:

• Purchase Order Book / Sales Order Book: Verify chronological list of orders, party names, and order numbers.
• Purchase Order Outstanding / Sales Order Outstanding: Track ordered quantity vs pending balance. Press F12 to view Cleared/Pre-Closed orders.
• Reorder Status Report (Alt + G → Reorder Status): View real-time breakdown of Closing Stock, Purchase Orders Pending, Sales Orders Due, Net Shortfall, and Order to be Placed.

Common Mistakes:

• Treating a Purchase Order (PO) as a financial Purchase Invoice (F9) or a Sales Order (SO) as Sales Revenue (F8).
• Assuming partially fulfilled orders close automatically without explicitly pre-closing the balance.
• Passing Credit/Debit notes or returns to cancel unfulfilled order quantities.
• Placing new purchase orders based solely on closing stock without accounting for existing pending POs in the pipeline.

Frequently Asked Questions:

• Q: Kya Purchase Order ya Sales Order se physical stock update hota hai?
  A: Nahi, order se physical stock ya financial ledgers affect nahi hote; yeh sirf inventory pipeline tracking ke liye hote hain.
• Q: Order Pre-Closure aur Order Cancellation mein kya difference hai?
  A: Cancellation pure order ko shuru mein hi cancel karna hai, jabki Pre-Closure partial delivery ke baad bachi hui pending quantity ko permanently close karna hai.
• Q: Reorder Level hit hone par kitni quantity purchase karni chahiye?
  A: Calculated Shortfall ya vendor ke Minimum Order Quantity (MOQ) mein se jo bhi higher value ho.

Quick Revision & Completion Checklist

Order Processing Golden Flow:
Customer Order (SO) / Purchase Requirement (PO) → Pending Order Tracking → Partial Delivery → Pre-Close Unfulfilled Balance → Check Reorder Shortfall & Pipeline → Raise Replenishment PO

Completion Checklist:

• Order Processing features enabled in F11
• Stock Items with Opening Quantities and Reorder Parameters configured
• Purchase Orders (PO-001, PO-002, PO-003) recorded and verified
• Sales Orders (SO-001, SO-002, SO-003) recorded and verified
• Partial fulfilment and Pre-closure executed on SO-001 and PO-002
• Pipeline stock vs MOQ calculated on Reorder Status reports